Full Judgment Text
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PETITIONER:
UNITED PROVINCES ELECTRIC SUPPLY CO. LTD. ALLAHABAD
Vs.
RESPONDENT:
T. N. CHATTERJEE
DATE OF JUDGMENT13/03/1972
BENCH:
GROVER, A.N.
BENCH:
GROVER, A.N.
SIKRI, S.M. (CJ)
RAY, A.N.
PALEKAR, D.G.
BEG, M. HAMEEDULLAH
CITATION:
1972 AIR 1201 1972 SCR (3) 754
1972 SCC (2) 54
CITATOR INFO :
F 1972 SC1626 (8)
F 1973 SC2650 (6)
ACT:
Industrial Employment (Standing Orders) Act, 1946, s. 4 and
Schedule items 8, 9 and 11C and U.P. Industrial Employment
(Standing Orders) Rules, 1946--Model Standing Orders, para
13--Applicability of Standing Order, re : age of retirement
to employees in service before the certifying of Standing
Orders--Framing of Standing Order regarding retirement
before amendment, of Schedule--Certifying Officer, if could
certify the standing order as fair or reasonable before
amendment of s. 4--High Court deciding question and
remanding--When operates as res judicata.
HEADNOTE:
In accordance with the provisions of the Industrial
Employment (standing Orders) Act, 1946, and the U.P.
Industrial Employment (Standing Orders) Rules, 1946, the
appellant substituted draft standing defining the conditions
of employment of its employees and they were certified
bythe Certifying Officer in 1951. Clause 32 of the Standing
Orders provided that an employee who has served 30 years or
who has reached the age of 55 years will be retired, but,
exemption from this may be granted by the company in special
case. In 1959, notices were served on the respondent-
workmen that they were retired by reason of their having
attained the age of superannuation as per cl. 32. The
workmen contended that the clause was not binding or
enforceable as far as they were concerned, because, they had
entered the service of the appellant prior to the
certification of the Standing Orders and there was no
condition that they would be liable to retirement after
attaining any prescribed age or any fixed period of service,
and that they were entitled to continue in service as long
as they were physically. fit. The industrial dispute was
referred to the Industrial Tribunal and the Tribunal held in
favour of the appellant. The respondents filed a writ
petition in the High Court They also applied in 1960, under
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s’ 10(2) of the Industrial Employment (Standing Orders) Act,
1946, for amendment and motification of cl. 32 claiming
fixation of retirement age at 60. The Certifying Officer
modified the clause and fixed the age of retirement at 58,
but the appellate authority refixed it at 55.
The High Court, in the writ petition, on the basis of the
decision or this Court in Guest Keen Williams Pvt. Ltd.,
[1960] 1 S.C.R. 348 her that Cl. 32 was not applicable to
the employees and directed the Tribunal to rehear the case.
The Tribunal thereafter held that the respondent. workmen
were wrongfully and unjustifiably retired.
In appeal to this Court,
HELD : (1) It was not intended by the Legislature that
different sets of conditions should apply to employees
depending on whether workman was employed before the
Standing Orders were certified by after, as that would
defeat the object of the legislation. The objection and
755
scheme of the Act is that the employers must define
precisely the conditions of employment of all the employees
and have them certified by the Certifying Officer. The
right given to be workmen to express their views, to raise
objections, to appeal to the appellate authority and to ask
for modification of the Standing Orders under s. 10 of the
Act, show that every possible safeguard has provided in the
interests of the workmen. Moreover, the individual items in
the Schedule to the Act show that there cannot be different
conditions for different employees depending upon the point
of time when they came to be employed, for that would result
in a great deal of heart burning between the employees inter
se. [762 F-H; 763 A-D]
Salem Erode Electricity Distribution Co. Ltd. v. Its
Workers; [1966] 2 S.C.R. 498, and Agra Electric Supply Co.
Ltd., v. Sri Alladin & Ors. [1970] 1 S.C.R. 808, followed.
(2) The decision in Guest Keen Williams Pvt. Ltd. that the
Industrial Tribunal had to consider not only the propriety,
reasonableness and fairness of a Standing Order but that it
had also to deal with the question as to whether a
particular Standing Order could be made applicable to
employees who had already been employed without any limit as
to age of retirement was delivered under the unamended s. 4
of the Act, under which the Certifying Officer or the
appellate authority could not go into the reasonableness or
fairness of the Standing Orders. But after the amendment of
the section in 1956, the Certifying Officer and the
appellate authority are bound to examine the question of
fairness of the standing orders, and therefore, there can be
no justification now for not giving effect to the principle
of uniformity of conditions of service which is clearly
contemplated by the provisions of the Act. [763 D-F]
(3) But cl. 32 of the Standing Orders as certified in 1951
was not valid and could not be binding on the respondents,
because, there was then ’no item in the Schedule to the Act
covering cases of superannuation or retiretirement, with
respect to which Standing Orders could be made. [766 E-F, G-
H]
Item 8 and 9 of the Schedule deal with the termination of
employment and notice thereof, and suspension or dismissal
for misconduct. The language of item 8 shows that it does
not cover the case of superannuation, which does not depend
on )any notice and which covers an event which is automatic
and which must be given effect to without any volition on
the Part of the employer or workmen. If termination is to
be read in a wide sense as meaning ’employment coming to an
end’ there was no necessity to have item 3, because,
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dismissal would then be covered by termination. From the
paragraph 13 of the Model Standing Orders contained in the
Schedule to Rules it is apparent that item 8 is confined to
termination of employment by notice in writing and ’does not
refer to superannuation or retirement. It was only in 959
that item 11(C) was introduced in the Schedule enabling the
framing of Standing Orders in relation to the age of
retirement and superannuation. [765 F-H; 766 A-C]
Saroj Kumar v. Orissa State Electricity Board, A.I.R. 1970
Orissa, 126, approved.
Management of the Windu’ v. Secretary Hindu Office &
National Press Employees Union, A.I.R. 1961 Mad. 107,
disapproved.
(4) No assistance can be derived by the use of the word
’retirement’ in para, 16 of the Model Standing Orders,
because, it may well refer to
756
retirement under the terms of the contract of employment
entered into between the employer and the employees. [765 A-
B, E]
(5) Since before the amendment of s. 4 the Certifying
Officer and the appellate auhority were debarred from
adjudicating upon, the fairness or reasonableness of the
Standing Orders, the Certifying Officer at that time, could
not certify any Standing Order on the ground that it was
reasonable or fair. Therefore, in 1951, when the Standing
Orders were certified, cl. 32 could not have been framed
because there was no item in the Schedule relating to
superannuation and the Certifying Officer could not certify
it on the ground it was fair and reasonable because he bad
no power to do so. [766 D-F]
(6) The Certifying Officer, however, when be modified cl. 32
and fixed the retirement age at 58 (after s. 4 was amended)
could have validly certified such clause as modified by him.
This Court could also give an appropriate direction with
regard to fixing the age of superan-, nuation. In the
circumstances of this case the age of superannuation should
be 58 years. Therefore, the concerned workman should be
deemed to have continued in service of the appellant till
they had attained the age of 58 years. [767 A-C, G-H]
(7) The order of the High Court in the writ petition did not
finally termingte the proceedings at all. The proceedings
were terminated only by the award of the Industrial Tribunal
after remand. Therefore, the order of the High Court
following Guest Keen William’s case did not debar a fresh
consideration of the question by virtue of the rule or
principle of res judicata. [768 A-B, E-F]
Satyadhyan Ghosal v. Smt. Deorajan Devi, [1960] 3 S.C.R.
590, followed.
Management, of N. Railway Co-operative Society v. Industrial
Tribunal, [1967] 2 S.C.R. 476, explained.
JUDGMENT:
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1734 of 1967.
Appeal by Special Leave from the Award dated the May 19,
1967 of the Industrial Tribunal (1) at Allahabad in
Adjudication Case No. 15 of 1960.
S. V. Gupte, D. N. Mukherjee and Gautam Banerjee, for the
appellant.
G. C. Bhattacharyaand M. V. Goswami, for respondents Nos. 1
and 3 to 8.
O. P. Rana, for respondent No. 9.
The Judgment of the Court was delivered by
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Grover, J. This is an appeal by special leave from an award
of the Industrial Tribunal, Allahabad, dated May- 19, 1967.
757
The material facts May be stated, The appellant, which is a
limited liability company and which later on went into
voluntary liquidation, was carrying on the business or
undertaking of generation, distribution and supply of
electricity. One of such undertakings was the Electric
Supply Undertaking at Allahabad in the State of Uttar
Pradesh. Its affairs and business were being% looked after
and managed by Martin Bum & Co. I-Ad., Calcutta. Some of
the appellant’s workmen in Allahabad and its surrounding
area were members of Bijli Mazdoor Sangh-a trade union
registered under the Indian Trade Union Act, 1926. The U.P.
State Electricity Board compulsorily acquired and took over
the assets of the appellant’s aforesaid undertaking or
business with effect from 16/17th September 1964.
In accordance with the provisions of the Industrial,
Employment (Standing Orders) Act 1946, hereinafter called
the ’Act and the U.P. Industrial Employment (Standing
Orders) Rules 1946 the appellant submitted draft Standing
Orders defining the conditions of employment of its
employees. On July 14, 1951 these Orders’were certified by
the Certifying Officer. Clause 32 of the Standing Orders
was in the following terms :-
"32. RETIREMENT-An employee who has served 30
years or who has reached the age of 55 will be
retired, but exemption to this may be granted
by the Company in-special cases".
The workmen through the Bijli Mazdoor Sangh preferred an
appeal under s. 6 of the Act from the order of (the
Certifying Officer to the State Industrial Tribunal which
was the. appellate authority under the Act. That appeal,
however,, was dismissed. The Agra Electric Supply Co. Ltd.,
Agra and Benaras Electric Light & Power Co. Ltd., Varanasi,
which is the appellant in the connected appeal (C.A. 164/68)
also got certified Standing Orders in similar terms. These
electric undertakings, were also under the management of
Martin Burn & Co. Ltd. On July 16, 1959 notices were served
on seven worlen with effect from September 1, 1959 on the
ground that they had attained the age of superannuation or
completed 30 years of service and they were retired by
reason of their having attained the age of superannuation.
Out of these workmen one of them Haider Ali died during the
pendency of proceedings. The other six employees have been
impleaded as respondents Nos. 1 to 6 in the present appeal.
According to the appellant these, respondents accepted all
the accumulations due to them in respect of Provident Fund
contributions made by the appellant in respect of them and
by themselves and were also paid gratuities credited to them
in their res-
758
pective Provident Fund accounts for their services prior to
their becoming members of the Provident Fund.
By an order dated February 22, 1960 made under s. 4-K of the
U.P. Industrial Disputes Act 1946 the Government of U.P.
referred to the Industrial Tribunal (1) at Allahabad for
adjudication an industrial dispute alleged to exist between
the appellant and its workmen on the following issues :
"Whether the employers have wrongfully arid/or
unjustifiably retired their workmen, mentioned
in the Annexure, with effect from 1st August,
1959 ? If so, to what relief are the workmen
entitled ?"
Respondents 1 to 6 and Haidcr Ali (since deceased) were the
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workmen mentioned in the Annexute. The case of the workmen
before the Industrial Tribunal was that they had entered
service of the appellant prior to the certification of the
Standing Orders. At the time of their appointment there was
no condition that they would be liable to retirement after
attaining any prescribed age or after putting in any fixed
period of service. A practice was in vogue that the workmen
would continue in service till he was physically fit.
Accordingly clause 32 of the certified Standing Orders was
neither binding nor enforceable. The Industrial Tribunal
made an award on May 2, 1960 finding, interalia, (a) the-
employers were within their rights in retiring, the workmen
concerned. (b) The act of the employers in compulsorily
retiring the concerned workmen,-from service could not be
characterised as wrongful, illegal or unjustified and (c)
the workmen were entitled to no relief.
On June 14, 1960 the Bijli Mazdoor Sangh moved an appli-
cation under s. 10(2) of the Act for amendment and modifica-
tion of clause 32 claiming fixation of retirement age at 60
years. On September 20, 1960 the Union also filed a writ
petition in the Allahabad High Court for quashing the award.
On April 22, 1961 the Certifying Officer modified clause 32
and fixed the ago, of retirement at 58 years. On September
10, 1961 the appellate authority refixed the age of
retirement at 55 years. Similarly appeals were filed by the
Agra Electric Co. and the Banaras Electric Light and Power
Co. Ltd. in which similar orders were made. On July 12,
1966 the, High Court recorded an order quashing the award.
It was held that Standing Order 32 was not applicable to the
employees Who had entered service before the certification
of the Standing Orders. The Industrial Tribunal was
directed to reheat the case and after giving an opportunity
to-the parties of being heard give an award in accordance
with law. Finally the award against which the appeal has-
been brought
759
was given on May 19, 1967. It was held in the award that
all the seven workmen had been wrongfully and unjustifiably
retired and that they should be deemed to have continued in
service till September 16, 1964 from which date they would
be taken to Wave been retrenched. The appellant having been
taken over by the U.P. State Electricity Board, it was
directed that the employers should pay full wages from the
period August 1, 1959 to September 16, 1964 and retrenchment
compensation within s. 25-F read with s. 25-FF and s. 25-J
of the Industrial Disputes Act, 1947.
While deciding the writ petition the High Court relied on
three decisions of this Court for holding that where there
is no age of superannuation prescribed for the employees of
a concern a provision in the Standing Orders certified
subsequent to the date of employment regarding compulsory
retirement will not be applicable to them. The first
decision is in Guest Keen, Williams Private Ltd. v. P. J.
Sterling & Others(1). In that case after the enforcement of
the Act the industrial concern submitted its draft Standing
Orders for certification to the Certifying Officer. That
Officer certified the Standing Orders after giving the trade
union of workmen an opportunity to be heard and after
considering their objections. The Standing Orders relating
to retirement provided that the workmen shall retire from
the service of the company on reaching the age of 55 years.
The company gave notice to forty-seven of its workmen who
were over the age of 55 years retiring them and a dispute
was raised about their retirement which was referred to the
Tribunal for adjudication It was ultimately held, by the
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Labour Appellate Tribunal that those workmen who were in
employment prior to the date of certification of the
Standing Orders would not be governed by it and their
retirement was illegal. This Court examined the scheme of
the Act including the relevant provisions. Notice wag
taken, in particular, of the fact that when the standing
Orders were submitted to the Certifving Officer all that he
could do was to satisfy himself that they made provision for
other matters set out in the schedule to the Act and that
they were otherwise in conformity With its provisions.
Under s. 4, as it was orignally enacted the Certifying
Officer could not adjudicate upon the fairness or
reasonableness of the provisions of the Standing Orders.
This section was subsequently amended-in 1956 and the effect
of the amendment was that the Certifying Officer was enabled
to adjudicate upon the fairness or reasonableness of the
provisions of the Standing Orders. It was pointed out by
the court that the scope for enquiry before the Certifying
Officer prior to the amendment of s. 4 was extremely
limited. The only way in which the employees could claim
modification of the standing Orders prior to the amendment
of s. 4 was by raising an industrial dispute in that
(1) [1960] 1 S.C.R. 348.
760
behalf. Subsequent to the amendment the employees could
raise the same dispute before the Certifying Officer and in
a proper case they could apply for its modification under S.
10(2) of the Act. It was observed that the Standing Orders
certified under the Act became part of the terms of the
employment by operation of S. 7 but if an industrial dispute
arose in respect of such Orders and it was referred to the
Tribunal by the appropriate Government the Tribunal had the
jurisdiction to deal with it on the merits. It was,
therefore, held that the Tribunal had to consider not only
the propriety, reasonableness and fairness of the rule but
it had also to deal with the question as to whether the said
rule could and should be made applicable to employees who
had already been employed without any limit as to age of
retirement. The decision in this case was followed in
Workmen of Kettlewell Bullen & Co. Ltd. v. Kettlewell Bullen
& Co. Ltd.(1). The next case in which a similar question
arose in Salem Erode Electricity Distribution Co. Ltd. v.
Salem Erode Electricity Distribution Co. Ltd. Employees
Union(2). It was claimed by the company which was the
employer there that the urgent need for increased production
and supply of electrical energy could be met if the existing
rules embodied in two of its certified Standing Orders
relating to holidays and leave were suitably amended. The
amendments proposed sought to introduce different rules
relating to holidays and leave for employees who were
appointed before a specified date and those who joined
service after that date. Both the Certifying Officer and
the appellate authority disallowed the amendments. The
company appealed, to this Court and the scheme of the Act
was examined once again. It was emphasised that after the
amendment of s. 4 of the Act made in 1956 jurisdiction had
been conferred on the Certifying Officer as well as the
appellate authority to adjudicate upon the fairness or
easonableness of the provisions of the Standing Orders.
Thus the jurisdiction had been widened.. Moreover under s.
10(2) as originally enacted it was only the employer who
could make an application to the Certifying Officer to I
have the Standing Orders modified. By the amendment made in
1956 even workmen were enabled to exercise that right.
Addressing itself to the question whether it was permissible
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for an industrial establishment to have two sets of Standing
Orders to govern the relevant terms and conditions of its
employees it was laid down after an examination of the
scheme of the relevant provisions of the Act in the light of
the matters specified in the Schedule that there was no
scope for having separate Standing Orders\ in respect of
any one of them, It was said
"........ the conclusion appears to be irresistible that
the object of the Act is to certify Standing Orders in
(1) [1964] 2 L.L.J. 146.
(2) [1966] 2 S.C.R. 498.
761
respect of all 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".
It was considered that Guest Keen Williams Pvt. Ltd.(1)
could afford no asistance because that matter came to this
Court from an industrial dispute which was the subject
matter of industrial adjudication and all that this Court
did was to fixed the age of superannuation for workmen who
had been employed prior to the date of the certification of
the relevant Standing Orders. That course was adopted in
the special and unusual circumstances of that case.
In the next decision Agra Electric Supply Co. Ltd. v. Sri
Alladin & Ors.(2) one of the main questions was whether
three workmen who had been employed long before 1951 when
the cornpany’s Standing Orders were certified could be
retired under Standing Orderwhich prescribed the age of
superannuation as 55 years. ThisCourt took a view which
seemingly runs counter to Guest KeenWilliams Pvt. Ltd.(1).
It was held that the Standing Orders when certified would be
binding on the employers as well as all the workmen who were
in employment at the time the Standing Orders came into
force and those employed thereafter as uniform conditions of
service. The process of reasoning which prevailed was (1)
the Act is a beneficient piece of legislation, its object
being to require employers in industrial establishments to
define with sufficient precision the condtions of employment
of workmen employed therein and to make them known to such
workman. (2) Before the passing, of the Act there was
nothing in law to prevent an employer having different con-
tracts of employment with workmen which led to confusion and
made possible discriminatory treatment. This was also
clearly incompatible with the principles of collective
bargaining. (3) Section 3 of the Act was enacted to do away
with such diversity and bargaining with each individual
workman. (4) Section 4 indicates that particulars of workmen
in the employment on the date of the submission of the draft
Standing Orders or certification and not of those only who
could be employed in future after certification were to be
given. (5) Sections 4 and 5 show that draft orders are
certifiable if they provide for all matters set out in the
schedule and are otherwise in conformity with the Act and if
they are adjudicated as fair and reasonable by the
Certifying Officer or the appellate authority. The
Certifying Officer has also to forward a copy of the draft
Standing Orders to the Union
(1) [1960] 1 S.C.R. 348.
(2) [1970] 1 S. C.R. 808.
762
or to the workmen in the prescribed manner and has to decide
whether or not any modification or addition should be made
after hearing the, Union or the, workmen concerned.
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Sections 6, 7, 9 and 10 contain provisions for appeal by
aggrieved persons as also for sending of authenticated
copies by the Certifying Officer to the parties where no
appeal is filed and further the employer has to post the
Standing Orders as finally certified in the manner
prescribed. The employer or the workmen can even apply for
modification after expiry of six months from the date on
which the Standing Orders or the last modification thereof
comes into operation. (7) The schedule, sets out- the
matters which the Standing Orders must provide for.
For the reasons given above this Court held that the Act was
meant to enable Standing Orders to be made to bind not only
those who were employed subsequent to their certification
but also those who were already in employment. If any other
result were to follow there would be different conditions of
employment for different classes of workmen which would
render the conditions of their service as indefinite and
diversified as befoe the ,enactment of the Act. Support was
derived from the decision in Salem Erode Electricity
Distribution case(1) in which departure was made from the
view previously taken in the case of Guest Keen William,s
Pvt. Ltd.(2)
It has been urged before us on behalf of the respondents
that the decision in Guest Keen Williams Pvt. Ltd. (2)
still holds the field and the point which was decided there
and which arises in the present case did not come up for
consideration in Salem Erode Electricity Distribution Co.
Ltd.(1). In our opinion the principle applied in the latter
case is fully supported by the scheme of the Act and was
rightly extended and applied’in Agra Electric Supply Co.
Ltd. (3). We concur with the view expressed therein that it
was not intended by the legislature that different sets of
conditions should apply to employees depending on whether a
workman was employed before the Standing Orders were
certified or after, which would defeat the very object of
the legislation. In the
preamble it is stated in categorical terms "whereas it is
expedient to require employers in industrial establishments
to define with sufficient precision the conditions of
employment under them and to make the said conditions known
to workmen employed by them". Not only the object but the
scheme of the Act is such that the employers must define
precisely the ponditions of employment of all the employees
and have the same certified by the Certifying Officer
against whose orders an appeal lies to the appellate
authority. The, right given to workmen to express their
(1) [1966] 2 S.C.R. 498.
(3) [1970] 1 S.C.R. 808.
(2) [1960] 1 S.C.R. 348.
763
view and to raise objections is of great significance. They
can even ask for modification of the Standing Orders in
accordance with s. 10 of the Act. Every possible safeguard
has been provided for keeping the workmen informed about
their conditions of service so that they can take whatever
steps they desire or are advised to take in their interest
before the Certifying Officer or the appellate authority.
It is also very difficult to conceive, taking each
individual item in the schedule how there can be different
conditions for different employees depending upon the point
of time when they came to be employed; for instance item 3
relates to shift working. It is possible to suggest that
for the same kind of work employees who were in employment
before the Standing Orders were certified would have
different hours of shift from the other employees who were
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employed subsequently. In the very nature of things a great
deal of irritation and annoyance between employees inter se
would result if any such discrimination is made in any of
the items in the schedule. It has been rightly pointed out
in Agra Electric Supply Co. Ltd. that this would only lead
to industrial unrest and not industrial peace, the latter
being the principal object of legislation.
It must be remembered that in Guest Keen Williams Pvt. Ltd.
the Certifying Officer could not go into the reasonableness
or fairness of the Standing Orders according to s. 4 of the
Act as it stood at the material time. The law was changed
only in 1956. Perhaps that was one of the main reasons
which prompted the court in taking the view it did. But
after the amendment of the law in 1956 the Certifying
Officer and the appellate authority are duty bound to
examine the question of fairness of the Standing Orders and
there can be no justification now not to give, effect to the
principle of uniformity of conditions of service which is
clearly conte mplated by the provisions of the, Act.
The next question for determination is whether clause 32 of
the Standing Orders relating to age of retirement could be
certifled in July 1951. On behalf of the respondents it has
been pointed out that there is no item in the schedule which
covers the case of retirement or superannuation. Items 8
and 9 are in these terms
"8. Termination of employment and the notice
thereof to be given by employer and workmen,
9. Suspension or dismissal for misconduct, and
acts or omissions which constitute
misconduct."
The model Standing Orders framed by the Central Government
and by the Government of the State of Uttar Pradesh did not
contain any clause relating to retirement or superannuation.
It was for the first time that on November 17,1959 item 11-C
764
relating to superannuation and retirement was introduced by
the State of U.P. in exercise of the rule-making powers
conferred by S. 15 of the Act. In other States the item
relating to age of retirement or superannuation was
introduced either by legislation or by the exercise of rule
making power. In the State of Bombay s. 19 of the
Industrial Employment (Standing Orders) (Bombay Amendment)
Act 1957 provided for insertion of item 10-A in the Schdule
which was "age for retirement or superannuation". According
to counsel for the respondents there was no item until the
introduction of item 11-C in November 1959 in the schedule
under which any Standing Orders could be framed and got
certified relating to the age of retirement and
superannuation. It has been maintained that items 8 and 9
cannot possibly include retirement and superannuation and
therefore till item 11-C was added in the schedule so far as
the State of U.P. was concerned in November 1959 no Standing
Orders could be legally or validly framed and certified
providing for age of retirement and superannuation. In
Saroj Kumar Ghosh v. Orissa State Electricity Board(1) the
Orissa High Court considered this question a some length and
expressed the view that where a Standing Order has been
certified by the Certifying Officer containing a clause
relating to superannuation not covered by the schedule of
the Act norr by the model Standing Orders such certification
cannot be valid under S. 4 of the Act. The clause
’termination of employment’ in item 8 of the schedule cannot
be equated with the word "superannuation". According to the
Orissa High Court, superannuation is an event which comes
more or less in an automatic process. An age is fixed on
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the reaching of which the holder of office has no option but
to go out of office. There is no volition involved in that
act. The employer and the employee have notice of the
matter long before the event is to occur and the event is
such that it cannot be arrested by either one of them if the
rule is to be followed. On the other hand termination is a
positive act by which one party even against the desire of
the other can bring about the end of employment. The
judgment of the learned single. judge in Management of the
"HINDU", Madras v. Secretary Hindu Office & National Press
Employees Union and another(2) was dissented from. In that
case the expression "termination of employment" in item 8
was considered to be wide enough to include retirement of an
employee at the age of superannuation. The learned Madras
Judge sought support from para 16 of the model Standing
Orders which is as follows
"Every permanent workman shall be entitled to
a service certificate at the time of his
dismissal discharge’ or retirement from
service".,
(1) A.I.R. 1970 Orissa 126.
(2) A.I.R. 1961 Mad. 107.
765
In the model Standing Orders there was no clause providing
for superannuation or retirement on attaining a certain age.
In our judgment much assistance or help cannot be derived
from para 16 of the model Standing Orders as contained in
schedule 1 to the Industrial Employment (Standing Orders)
Central Rules 1946. Retirement which is mentioned there may
be under the terms of contract of employment entered into
between the employer and the employees. Section 2(oo) of
(the Industrial Disputes Act 1947 throws a certain amount of
light on the matter. It is reproduced below :,-
"Retrenchment" means the termination by the
employer of the service of a workman for any
reason whatsoever, otherwise than as a
punishment inflicted by way of disciplinary
action, but does not include-
(a) voluntary retirement of the workman; or
(b) retirement of the workman on reaching the
age of, superannuation if the contract of
employment between the employer and the
workman concerned contains a stipulation in
that behalf;"
It shows, firstly, that termination ’of service of a workman
is distinct from retirement on reaching the age of
superannuation; secondly, retirement can take place on resch
& the age of superannuation under the terms of the contract
of employment entered into between the employer and the
workman. Therefore, the word "retirement" in para 16 cannot
be regarded as conclusive of the question whether
termination of: employment includes retirement and
superannuation. In the schedule to the Act item 8 covers
termination of employment and the notice to be given either
by the employer or the workman and item 9 relates to sus-
pension or dismissal for misconduct etc. Item 8 by virtue
of the language employed does not appear to cover the case
of superannution which does not depend on any notice and
which covers an event which is automatic and which must be
given effect to without any volition on the part of the
employer or the workmen as pointed out in the Orissa
judgment. If termination is to be read in a wide sense as
meaning employment coming to an end there was a necessity to
have item 9 because dismissal would then be covered by
termination. In the context in which the word
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",termination" is used in item 8 it cannot mean each and
every form of termination or cessation of employment. From
para 13 of the Model Slanding Orders contained in schedule 1
to the Industrial Emtployment (Standing Orders) Central
Rules 1946, it is apparent that item 8 is confined to
termination of employment by notice in writing and does not
contain any mention L1061 Sup. CI/72
766
of superannuation or retirement. It was perhaps this
difficulty which prompted the state or U.P. to introduce
item 11-C in exercise of the rule making powers conferred by
s. 15 of the Act and the bombay legislature to make similar
amendment by legislation. it would follow that unless an
employer can include a clause relating to the age of
retirement and superannuation and the Certifying Officer can
certify it even though no such item appears in the schedule
to ,the Act clause 32 as certified in 1951, in the present
case, could not be regarded to be valid. The Madras High
Court in the case of Management of the ’Hindu’, Madras(1)
made some observations to the effect that there was no bar
to the Standing Orders making a provision for matters other
than those specifically mentioned in the schedule so long as
,the Certifying Officer certifies them on he ground that
they are fair and reasonable. The Orissa High Court,
however, in Sarojkumar Ghosh’s(2) case did not subscribe to
this view. Learned counsel for the appellant, apart from
relying on the Madras decision, has not addressed any
arguments on the larger and wider question as to whether
even in the absence of any item in the schedule Standing
Orders can be framed on certain matters which may be
regarded as fair and reasonable and which may be so
certified by the Certifying Officer. it is, however,
unnecessary to decide this point in the present case because
clause 32 of the Standing Orders on which the appellant has
relied was certified in July 1951 when according to the
express language of s. 4 of the Act the Certifying Officer
or the appellate authority was debareed from adjudicating
upon the fairness or, reasonableness of the provisions of
any Standing Orders. It is difficult to understand how the
Certifying Officer at that point of time and before the
amendment of s. 4 in 1956 could have possibly certified ;my
Standing Order which did not relate to any item in the
schedule on the ground that it was fair or reasonable Indeed
the function of the Certifying Officer, before the amendment
of 1956, was very limited as is clear from s. 3 (2) of the
Act which says :
"Provision shall be made in such draft for
every matter set out in this schedule which
may be applicable to the industrial
establishment and were model Standing Orders
have been prescribed, shall be, so far is
practicable, in conformity with such model".
We must, therefore, hold that, clause 32 of the Standing
Orders as certified in July 1951 was not valid and cannot be
binding on the respondents. However, after item 11-C was
introduced in the schedule so far as the State of U.P. was
concerned an item was added providing for the age of
retirement and superannuation. The Certifying Officer, when
lie modified clause 32 and
(1) AIR 1961 Mad. 107.
(2) AIR 1970 Orrissa 126.
767
fixed the,:retiring age at 58 on April 22, 1961 could have
validly certified such clause as modified by him. The
necessary consequence will be that the respondents could not
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have been relied ’on the ground of superannuation in July
1959 and they could be validly retired only on or after
April 22, 1961 in accordance ,with clause 32 as modified by
the Certifying Officer. In other words, those out of the
present respondent who had attained the age of 58 years on
April 22, 1961, could be regarded as having been validly
retired having reached the age of superannuation on that
date under that clause.
In view of the previous decisions of this Court and in
particulaw that of Guest Keen Williams Pvt. Ltd.(1) it has
not been disputed that in the industrial dispute which was
referred it was open’ ’to the Industrial Tribunal or the
Labour Court to determine the age of retirement or
superannuation notwithstanding that clause 32 of the
Standing Orders as certified in 1961 had been legally ,And
validly certified indeed in Guest keen Williams Pvt.
Ltd.(1) It was not disputed that even this. Court could
give an appropriate direction which might ’be considered
reasonable with regard to ’the age of superannuartion as
stated before according to clause 32 of ’the Standing
Orders, as certified in April 1961, the age of
superannuation was fixed at 58. The appellant ’filed an
appears that in the cage of Agra Electric Supply Co.(2) also
a appears that in the case of Agra Electric supply Co.(4)
also a similar Standing order had been certified and on
appeal the age of -retirement was reduced from 58 to 55
years by the appellate ’authority. This Court in that case
held the Standing Order fixing the age at 55 years
applicable not only to those employees who were employed
subsequently but also to all workmen who were in employment
at the time when the ’Standing Orders became legally
applicable. It does not appear in that case that any such
argument was raised that the matter should be remitted
either to the Industrial Tribunal or the Labour Court to fix
the age of superannuation or that this Court itself might do
so as was the course followed in the case of Guest keen
Williams Pvt. Ltd.(1) in which the age was fixed at 60
years with regard to those employees who had raised the
dispute on the ground that the Sanding Orders could not
govern them as they had been employed before the Standing
Orders became applicable. After considering the entire
material and keeping in mind the fact that according to the
appellate authority even the age of retirement at 55 was
fair and reasonable we are of the view that the age of
superannuation of the respondents, in the present case,
should be 58 years. In other words. it will be the same as
was fixed by the Certifying Officer by modifying clause 32
on April 22, 1961.
(1) [1960] 1 S.C.R. 348.
(2) [1970] 1 S.C.R. 808
768
Lastly we must deal with the contention raised on behalf of
the respondents that the order of the Allahabad High Court
made on July 12, 1966 quashing the award after following the
decision of this Court in Guest Keen Williams Pvt. Ltd.(1)
should be deemed to be final and should debar any fresh
consideration or decision of that point by virtue of the
rule or principle of res-judicata. It is noteworthy that
the order of the Allahabad High Court was not final against
which the matter could have, been taken in appeal either to
a division bench of the High Court or to this Court.
Reliance has been placed on a decision of this Court in
Management of Northern Railway Cooperative Society Ltd. v.
Industrial Tribunal Rajasthan, Jaipur and Another(2), where
reference had been made by the State Government to the
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Industrial Tribunal on the Railway Workers’ Union having
raised an industrial dispute against the Management of the
Northern Railway Cooperative Society Ltd. The society filed
a writ petition on the ground that the dispute having been
raised by the Railway Workers’ Union and not by the
Society’s own employees the reference to the Tribunal was
not competent. The High Court dismissed the petition.
thereafter the Tribunal heard the matter and gave its deci-
sion in favour of the workman concerned. The society
appealed to this Court by special leave. It was held that
the order of the High Court was not interlocutory but was a
final order in regard to the proceedings under Art. 226.
The appropriate remedy for the appellant in that case was to
appeal against the High Court’s order and that not having
been done the appellant’s plea relating to the competency of
the reference was barred by res judicata as the same had
been raised before the High Court and had been rejected.
The present case is clearly distinguishable inasmuch as the
order made by the High Court was not final and a remand had
been directed presumably under Art. 227 of the Constitution.
That order in fact did not finally terminate any proceedings
at all. The proceedings were terminated only by the award
against which the present appeal has been brought by special
leave. We are unable to see how the decision in the
aforesaid case can afford any assistance to the respondents
before us. Indeed the case which is more apposite in
Satyadhyan Ghosal & Ors. v. Smt. Deorajin Debi & Another (
3 ) . There an order of remand had been made by the High
Court while exercising powers under S. 115 of the Code of
Civil Procedure. It was observed, after referring to the
various decisions of the Privy Council, that the order of
remand was interlocutory and did not pumort to dispose of
the case. A party is not bound to appeal against every
interlocutory order which is a step in the procedure that
leads up to a final decision or award.
(1) [1960] 1 S.C.R. 348.
(3) (1960) 3 S.C.R 590.
(2) [1967] 2 S.C.R. 476.
769
The following observations from this case may be reproduced
with advantage
"Interlocutory judgments which have the force
of a decree must be distinguished from other
interlocutory judgments which are a step
towards the decision of the dispute between
parties by way of a decree or a final order".
We are unable, therefore, to accede to the contention that
the rule of res-judicata could be invoked by the, respondent
in the present case.
In the result the appeal is allowed and the order of the
Industrial Tribunal is hereby set aside. According to our
decision the workmen concerned could not have been retired
on the ground of superannuation in accordance with clause 32
of the Standing Orders till it was certified after necessary
modification on April 22, 1961. Even otherwise it has been
held by us that the proper age of retirement in ,he case of
those employees who joined service prior to April 22, 1961
should be 58 years. The award, therefore, will be that the
concerned workmen should be deemed to have continued in
service of the appellant till they had at attained the age
of 58 years. It is declared that they shall be entitled to
be paid full wages and all other dues to which they are
entitled under ,the terms of their employment till they
attained the age of 58 years. As regards any payments
received by the workmen pursuant to the award or after the
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notice of termination those shall also be adjusted
accordingly and the appellant undertakes not to claim_refund
of any amounts which have already between received by them
in excess of the amounts due. No order as to costs.
V.P.S. Appeal allowed.
770