INDIA MARINE SERVICE PRIVATE LTD. versus THEIR WORKMEN.

3 S.C.R. · 1 SUPREME COURT REPORTS

INDIA MARINE SERVICE· PRIVATE LTD.

THEIR WORKMEN.

(P. B'. GAJ])NDRAGADKAR, K. C. "DAS,. G~TA and J. R. MUDHOLKAR, JJ.)

lndusirki,l Diipute~Dismis~al of e~ploy~e'--'in~bordi·. nation~Tribunal's power to re-in.~tate-Lock-out due· to illegal strike-Lock-out originally valid but found invalicl ldter-Olaim for wages for the perioil of lock-out.. '

B, clerk in the appellant company, was found shouting and bel:\aving in r:ide a.nd insolent manne~ ~it~ p.is superior officer.· In consequence of this incident charge-sheet was issued ~o· him and he was asked to give his 'explan'ation for' his behaviour; he was also asked to give explanation fn reipect ofcc;rtain purchases made by him for the coffi.papy. '.Eventually" an enquiry was held by the Managing Director at which he found that two charges were made out, and on the basis of the findings the company dismissed from his post.. In the letter by the Managing Director dated October 29, 19511, addressed to Bit was stated: "After giving, your matter .our very; careful consideration, we have, therefo~e, painfully come to the decision that in the interest cif discipline and Business you should be forthwith dismissed from our ser,vice .. "· rn· taking this action against you we have also taken into consideration your past record which is very much against you." The Industrial Tribunal considered that the findings were based not merely on the charges set out in the charge-sheet but on certain other charges which was not given on opportunity . to explain, and, therefore, the enquiry was vitiated and the dismissal could not be sustained. The Tribunal proceeded to consider the evidence and held that the allegation of insubordination against was not proved, •I:t, accordingly, oraered his re-instatement.

. . Helcl, that the order of the Tribuna:1. was contr~ry to law; .that the Managing Director must be considered, in his letter; to have arrived at the conclusion that B's services should be terminated in the interest of1discipline. though he had added one sentence to give. a.dditionill weight to the ilecision already arrived at; and that the Ttib.unal was not competent to go.behind the finding of the Managing Director and consider for itsci.lf the evidence adduced before 'him. r · · , ' . ' ,·

1962 --

India Morine tTWic1 Pf'it1ate IJd. •• Their Workmen

SB'I~R~ME COURT REPORTS (1963] . ·,.. ,,

On acc0uilt ·or sudden: ;trike iaun~hed by th~ _,;o~kmen on November 13, 1958, the company declared lock-out. The lock-out continued till January·5, 1959 on which date the company's works were re~opened, It w~s found that while the strike was unju~tifiabli: •. and: the: lock-out when it was ordered on November 13, 1958, was justified, its continuance for 53 days was' WhOlly: 'unrl!a:sonable .. and, therefore, unjustified. ·

. Held, that.where strike is ·unjustified ·and· is· followed hy.a lock.out which has, because of its long du.ration;. become -qnjustificd, .the ·proper course for· an .. industrial tribunal .is to apportion the blame and direct the payment of the wages for the period of the lock-out which could be considered as 1Jnjustified. · · · .. ' wh~re sirike is unjustified and the l~ck~oµt is justified t~e workmen would not be entitled to any · wages at all, but where the, strike is justified qnd the lock-out is unjustified the workmen would b,e entitled to the entire wages for the period qf strike and lock-out. . .

. CIVIL APPELLATE Jmi.lsmOTION: Civil Appeal No. 202 of 1962.

:. . . Appeal by special leave from the Award dated

January 31, 1961, of the Third Industrial Tribunal, West Benaal, in case No. VIII-28 of 1960. ·

. , o. I ,

• . , Y. Kumar, forthe appellant.

, • B. P .. Maheshwari, for the respondents.

' . , , 1962. August 8. 'fhe Judgment of the Court was·delivered by'

.. ' . '

' . ' ' . MUDHOLKAR, J.,.-In this appeal ~y special

leave against an ward made by · the· '-!?hll'd I?dust· ~ial,Tr.ib;unal, West ·Bengal,. two questions t\J'.IS,e for considerati<in. , The first is whether the dismissal of Robin Bose, Purchaser, ·was justified and the other is whether the appell&nt's employees were entitled to.' any w&ges for the period between NoveiQiber: 1;3,'Hl[l8; and January 4, J95~, dqring -which there :was. a.look-out, . , , . ' ' . . ' ' ' " ..

3 S.C.R. · 1 SUPREME COURT REPOR'rS

In sense the two questions are separate and we will first mention the .facts relevant to the ques-tion regarding the dismissal of Robin Bose. Bose was a. clerk, designated as Purchaser by the appel· lant company. On September 13, 1958, at about 10-00 a. m. &. N. Chatterjee, !mder whose super-vision Bose was working, took from the latter's table the purchas·e estimate book maintained by him for the purpose of checking an item of purchase made by him on August 18, 1958. ShortlY. after-wards Bose went up to Chatterjee and asked for the book to be returned. Chatterjee told him that the book should be left there fore some time and would be returned to him after he (Chatterjee) had finish-ed with it. Bose, however, got annoyed. H-:i flared up and started abusing Chatterjee in an objectionable language in the presence of the entire office staff. Though reminded by Chatterjee of the need for mi.intaining discipline in the office he did not pay any heed to Chi;. tterjee. Then he told him in loud and thre1.1.tening voice: ''Don't teach me office discipline. I have worked in bigger offices, you shall have to bear consequence, if you don't return the book right now." Chatterjee reminded him that he was ·•purchase-in-charge" and had every right to see the registers mai~tained by the nur· chase department. This only infuriated Bose fur-ther and he said "I shall see you-I know how to teach you good lesson," and left Chatterjee's table. Shortly thereafter the Managing Director came and Chatterjee reported the matter to him about Bose. Bose Wl.'S then called by the Managing Director to his Chamber and asked for an explanation for shout· ing and behaving in rude manner with his superior. It would appear that Bose was not repentant and after lea-ving the Managing Director's room again started being nasty to Chatterjee and said in a.loud voice ''If you don't arrange to return the book at o:qce • • I will teach you good lesson on . • I . ·. the roaq," I

1961 India Marini S11viee Private Ltd. v. Their W 01kmen Mudholkar J.

India Maf'ifle · 8ptJ;ee Priuate .•. ~'?· Their W Otkmen Mudholkar J. ·

578 SUPRIEME COURT RBP(i)RTS [1963]

Thereafter the Managing ,Director came out of the room and with difficulty succeeded in making him quiet. .

In consequence of this incident charge-sheet was issued to Bose and he was asked to give his written explanation for his rude and insolrint be-haviour towards his superior officer R.N. Chatterjee. He was also asked to explain another matter, that is, not bringing to Chatterjee's notice the fact that on August 18, 1958, he had bought copper •heets at Rs. 3-1-0 per lb. from Messrs. Joydeb Nityalal Paramauick and when he was sent again to purch-ase the same commodity from the same firm on August 21, 1958, he bought it at . the ratt> of Rs. 3-4-0 per lb. In his reply dated September 20, 1958, Bose stated that what was set out in the cha.rge-sheet was distortion of facts ~d that at the time of enquiry he would place all the facts before the enquiry officer. He, however, denied tl.e char-ges. To this the .company replied saying that the statement was vague and that in his own interest and in the interest of justice he should give liis pre-cise explanation. To this Bose replied saying that ho had. nothing further to say. Then some further correspondence ensued between Bose and the com-pany and as result of something which Bose had said is one of his letters he was served' with second. charge~sheet.

Eventually an enquiry was held by the Manag-ing Director at which he found that the two chargeR set out in the first charge-sheet were made out. On the basis of the findings the company dismissed Bose from his post. No separate report had been drawn up by the Managing Director who held the enquiry but aH material things were set out in the letter. dated Qotober 29, 1958, aQdressed by him to ~ose, · · · ..

3 S.C,R. SUPREME COURT'.REEORTS

The Tribunal observed that no tenqU:iry was held on the second charge-sheet and,: therefore, the charge.sheet should be ruled out '.from · considera-tion and that as the findings were based not merely on the charges set out in the first charge-sheet ·but on certain other charges which Bose was not, given an opportunity to explain the enquiry was· ;vitiated and the dismissal could not be sustained. It; there-fore, proceeded to consider the evidence .. adduced before the domestic Tribunal and. held' •that the allegation of insubordination Against,Bose has not been proved by convincing evidence. ; It, therefore, ordered the re-instatement of Bose .with full back wages and allowances from the date .of his dismissal upto the_date on which he will be re-instated.

India Marine Service Private Ltd.

Th1ir Workmen

Mudholkar J .'

It is no doubt true that no enquiry ;was· held on .the charges contained in the second charge-sheet and, therefore, that charge-sheet w~s rig;htly .k~pt · out of consideration by the Managing Director and the '.l'ribunal. It is true that .reference: -is m~qi;i to certain extraneous matters in the letter of the Managing Director dated October 2!J, 1,95&, · ~d~ress­ed to Bose. But considering the letter as.a .who)e and particularly the last paragraph ·it st)e~s. tp .us to be abundantly clear that the decision qf the Managing Director to dismiss Bose was based only · on the charge of insuboruination. In this connect-ion it will be useful to quote that paragraph:

.k~pt ·

"After giving your. matter our very careful consideration, we have, therefore, painfully come to the decision that in the interest of discipline and business you should be forthwith dismis1:1ed from our service. Accor-dingly your service will no longer be requir. ed by us from today. In taking this action ~,gainst you we have also taken into consider-ation your past record which is very much. . ~a~t.roq:''; .-. . ·

1sin

It is true that the last sentence suggests that the past record of Bose has also been taken into Ltd. consideration. But it does not follow from this that that waR the effective reason for dismissing him. The Managing Director having arrived at the conolusion that Bose's services must be terminated in the interest of discipline, he added one sentence to give additional weight . to the dicision already arrived at. Upon this view it would follow that the Tribunal was not competent to go behind the finding of the Managing Director and consider for itself the evidence adduced before him. The order of the Tribunal quashing the dismissal of Bose and directing his re-instatement is, therefore, set aside ·as being -contrary to law.

India 'Marine Seruice Private Ltd. v. Thair W 01 kmen M udhalkar .1.

Coming next to the question of the lock-out it is abundantly clear that the look-out was ordered by the company because of sudden Btrike, no doubt token one, launched by the workmen. It would appear that the strike was only to be partial and notice of it was given on the previous day. In order to appreciate the background of the strike and look-out it is desira.ble to set out certain facts. By an agreement dated N<nrember 23, 1956, the management had agreed to pay 37 days' wages to its factory employees for the year 1955·56 as bonus. It was also agreed at that time that bonus was not to be a. condition. of service. On Septem her 10, 19.58, the respondent union mad~ demand for seven days' . bonus over and above the usual bonus of :>,7 days. In rnply to this the company stated in its letter dated October 11, 1950, that it does not agree to the demand that. bonus is payable · ·as condition of ·service, that although no bonus .is payable, the company, as gesture of goodwill, have offered to pay to. the workmen 15 days' consolidated wages as bonus and expresil~d the hope tha.t its offer would be aooe~ted. On October

3 s.C.:R. SUPREME COURT REPORTS

13, 1958, the company again wrote to the union

pointing out that the workmen bad resorted to go slow tactics which adversely affected their business which was of repairing ships and then observed:

[ndia/Jlari111 S er?Jice PrilHlh Lii. • v. Their Workmen

"We should also strongly suggest that

M udholkar J.

the management and the union jointly approach the Labour Directorate at once on the follo-. wing issues:

1. Whether the workmen are justified in stopping overtime as and when they like.

2. Bonus.

In oonsideration o.f this we may even

. In oonsideration o.f this we may even agree to pay the workmen certain sum of money, as iµ.ay be recommended by the Conciliation Officer, on advance account pending the adjudication by the Tribunal of' the issue of bonus. It sho"Q.ld, however, be clearly understood, that if the Tribunal decides against payment of bonus or allows bonus less than the amount advanced to them, the entire advance money or the difference will · be recovered from the wages of the workmen by instalments as may be directed by the Tribunal."

This suggestion wa.s peremptorily rejected by the

respondent union by its letter dated October 15, 1958, the relevant portion of which is as follows:

"We would simply ask where bad your

good sense for tripartite conference before which you have adopted now we think as a. measure of delaying tactics. We know better what to do when we will be asked to attend tripartite conferen9e." · .

. On October 16, 1958, the company wrote to the Labour Commissioner, }Vest Bengal, apprising him

196B Irulia larine S1rHte p,i,ate Ltd. ·-Their fYorkmtn Mudhol<ar J.

582 ~tJPREM:E OOtJRT REPORTS [1963]

of the situation in ·the factory and requesting him to intervene. It seems that on that day repre-sentative of the company discussed . the situation with Mr. Basu, the Assistant Labour Commissioner. Next day the· company wrote to Mr. Basu in which it observed that although the financial position of the company. does not justify the demand of bonus the company was prepared to make ex-gratia payment of bonus on the same ·basis as in the . previous year subject to three conditions: ' ' .

"(i) the Union condemns the workmen's conduct in stopping overtime since 10th -October, 1958 and putting the company to considerable loss.

(ii) the Union undertakes to see that the workmen do not stop doing overtime in future.

(iii) the bonus is not to be consi<lered as condition ·of service."

On November 5, 1958, the respondent union wrote

to the company letter in. which they made ten demands, the first of wh.ich, was that 37 days' wages as bonus should . ])e paid to all workmen at the works and head office. Then they went on pHrti&I strike on November 13, 1958. On that very day the company published look-out notice on its notiee bol!rd and served copy thereof on the union. That notice reads thus:

"For sometime past the workmen by taking re.sort to organised slow down and by refusing to work overtime and by keeping strike notice hanging on us have to great . extent crippled our ship repairing business and have made it difficult for us .to aooept major ship repairs or large orders. · Today · hte workmen have resorted to strike when . , { . I . -

we have on our hands ship in dry' dock awaiting unlocking today and another ship is due to sail in two days' time. This strike is definitely illegal and in consequence of this illegal strike we have no choice but hereby to declare lock-out.''

The lock-out continued till January 5, 1959, on which date the company's works were re"OP"lned. The termillation of the lock-out was brought by · settlement made between the parties on January 3, 1959. In that settlement it waH agreed that I% of the sale proceeds of the ship repairing section, leas sales tax, for the whole year will be paid as bonus to the workmen irrespective of profit and 'loss of the company and 15 d&ys' wages wm be paid as Puja bonus to the workmen every year irrespective of profit and loss of the company. It .is not necesllary to refer to the other terms of the agreement.

It seems to us that the attitude of the

company· was reasonable one and that it even proposed to the union and through it to its workmen that work should go on, that the dispute should be taken before the Conciliation Officer for conciliation and that in the meanwhile they were prepared to grant some interim relief to the workmen. ·But instead of accepting ·this rflasonable offer the union spurlJ\}d · n contemptuously and .for coercing the c9mpany encouraged its members to strike work 6n November 13: 1958, It is true that the strike was intended to be token one. But; the object of that strike being to circumvent settlement in an amicable manner, even though the company was rea1y for such settlement, we have no doubt that strike was unjustified. It is in the light of this finding that the look-out halfto.be judged. In our opinion, while the strike was unjustifiable the lock-out when it was orderd on November 13, 1958, was justified.

I niitJ M 1Jrin1 SmJic1 l'ritlaU Lti. y; Th1ir 1' Wk"'411 --M udholkar J •

India M r..rine Seroice Prioo.le Ltd. v. Th<ir W orl>""" Mudholk•• J.

It seems to us, however, that though the lock-out was justified at its commencement its continuance for 53 days was wholly unreasonable and, therefore. unjustified. In case where strike is unjustified and is followed by lock-out which has, because of its long duration, become unjustified it would not be proper course for an industrial tribunal to direct the payment of the whole of the wages for the period of the look-out. We would like to make it clear that in case where the strike is unjustified and the look-out is justified the workmen would not be entitled to any wages at all. Similarly where the strike is justified and the lock-out is unjustified the workmen would be entitled to th.e entire wages for the period of strike and look-out. Where, however, strike is unjustified and is followed by lock-out which becomes unjustified case for apportionment of blame arises. In our opinion in the case before us the blame for the situation which resulted after the strike and the lock-out can be apportioned roughly half and, half between the ·company and its workers. In the circumstances we, therefore, direct that the workmen should get half their wages from November 14, 1958, to January 3, 1959, (both days inclusive).

The appeal is thus allowed partly and the

award modified to the extent to which the appeal hail been allowed. We make no order as to cost.

Appeal allowed in part.