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  • Sec. 4-K of the U.P Industrial Disputes Act,
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  • Sec. 4-K of the U.P Industrial Disputes Act,
Smart Summary

Analytical Summary of the Opinion (Pathak, J.)

Factual and Procedural Background

The petitioner is Messrs Shanker Flour, Rice and Dal Mills, Bareilly, a partnership firm engaged in flour milling. On 12 September 1960 the firm framed three charges against its workman, Mani Ram: (1) demanding a Rs. 2 subscription for the Union from a chaukidar, quarrelling with him and holding out threats on 30 August 1960; (2) heaping refuse in front of the chaukidar's quarter from 3 September 1960 to harass him; and (3) deliberate negligence in the care of the boiler and engine resulting in a breakdown in mid-August 1960 and adversely affecting production.

A domestic enquiry found the second charge not proved but found the workman guilty of the first and third charges and the Enquiring Officer recommended dismissal. Mani Ram was dismissed with effect from 14 October 1960. The Shanker Flour Mill Workers' Union raised an industrial dispute on his behalf. The State Government referred the dispute (after an initial decision not to refer) to the Labour Court on the question whether the employer had terminated Mani Ram's services legally and/or justifiably, and if not, what relief was due.

The Labour Court, by award dated 12 February 1962, held the dismissal illegal and unjustified and directed reinstatement with continuity of service. The petitioner filed the present petition for certiorari challenging that award.

Legal Issues Presented

  1. Whether the dismissal of the workman, Mani Ram, was legal and/or justifiable.
  2. Whether the domestic enquiry was vitiated by the absence from the record of the expert's report (Kedesia) relied upon to prove negligence.
  3. Whether the third charge against the workman properly fell under Standing Order 20(j) (neglect/neglect repeated and punishable by dismissal) or under Standing Order 22(b) (negligence punishable only by censure or warning), given the vagueness of the charge.
  4. Whether the petitioner victimised the workman in framing charges and awarding dismissal.
  5. Whether the State Government, having initially declined to refer the dispute, could subsequently make a reference under Section 4-K of the U.P. Industrial Disputes Act.

Arguments of the Parties

Petitioner's Arguments

  • It was unnecessary to produce the expert, Kedesia, in the domestic enquiry because a partner of the firm, Rameshwar Nath, had testified concerning the damage to the boiler and that testimony sufficed in place of the expert's direct evidence.
  • The charge relating to negligence properly fell under Standing Order 20(j), which permits dismissal for negligence repeated on not less than three occasions within six months; therefore, dismissal was an available and proper punishment.
  • The objection that the action was motivated by victimisation was not raised at the domestic enquiry and therefore should not have been entertained later by the Labour Court.
  • Once the State Government had decided not to refer the dispute for adjudication, it could not later exercise the power to refer under Section 4-K; the State's earlier decision not to refer exhausted the power.

The opinion does not contain a detailed account of the respondent (workman/union) legal arguments in adversarial form; instead, the Labour Court's findings and conclusions are recorded in the body of the judgment and form the basis of the court's analysis.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
R. v. Deputy Industrial Injuries Commissioner, Ex parte Moore (1965) 1 A.E.R. 81 Illustrates a circumstance in which expert opinion was before the tribunal and parties had opportunity to comment; used to consider whether direct production of an expert is always required. The court distinguished the present case from Moore: in Moore the experts' opinions were on the record and open to comment, whereas in the present case the expert's report (Kedesia) was not on the record and only the partner's understanding of that report was given. The court held that Moore did not justify the failure to place the expert's report on the record here and concluded that the absence of the report was a serious lacuna in the domestic enquiry.

Court's Reasoning and Analysis

The court proceeded by addressing the petitioner's main contentions in sequence and applying legal principles strictly as found in the record:

  1. On the expert's evidence: The court accepted that in some circumstances direct testimony of an expert may not be necessary. However, it emphasized that when an expert's report forms the basis for a finding of negligence, the report itself must be placed on the record so the accused workman can examine and challenge the report. Rameshwar Nath's testimony was only an account of his understanding of the expert's report and did not substitute for the report itself. Comparing the facts to R. v. Deputy Industrial Injuries Commissioner, Ex parte Moore, the court found the present case distinguishable because in Moore the opinion was on the record and parties could comment; that was not so here. Therefore the Labour Court was justified in finding a serious lacuna in the domestic enquiry for non-production of the expert's report.
  2. On classification under standing orders: The court analysed Standing Order 20(j) (neglect or negligence repeated on not less than three occasions within six months, punishable by dismissal) and Standing Order 22(b) (negligence or neglect of work punishable only by censure or warning). The court found the third charge to be couched in vague terms, merely alleging that defects had been present "for several days" and that there was an "accumulation of defects." Because the charge did not clearly specify how the workman was negligent or whether the negligence consisted of a single omission or repeated omissions, it was impossible on the face of the charge to determine whether the misconduct came within 20(j) or 22(b). The Labour Court's characterisation of the charge as vague was, in the opinion of the court, correct.
  3. On victimisation: The Labour Court had concluded that the charges and dismissal were effected to victimise the workman. The petitioner did not challenge that finding before the court on its merits; instead it argued procedural exclusion because the objection had not been raised earlier at the domestic enquiry. The court held that the petitioner should have raised that objection before the Labour Court and was not entitled to raise it for the first time in the present petition.
  4. On State Government's power under Section 4-K: The petitioner contended that after the State Government once declined to refer the dispute, it had exhausted its power and could not later make a reference. The court analysed Section 4-K and found that the statutory power is a positive power to refer a dispute "at any time" by an order in writing. The court reasoned that a refusal to refer is not the exercise of the Section 4-K power; the power is only exercised when a reference is made. The court noted that administrative authorities may revisit earlier decisions so long as they act within the grant of power and not mala fide or arbitrarily. The court observed that after the initial decision not to refer, further facts were brought to the State Government's attention (by the Hind Mazdoor Sabha), enquiries were directed, and on the basis of the Assistant/Regional Assistant Labour Commissioners' reports the State Government decided to make the reference. The court found no force in the petitioner's contention that the State Government could not change its mind.

Holding and Implications

Core Ruling: The petition is dismissed with costs. (The court concluded that the petition challenging the Labour Court's award could not succeed.)

Implications for the parties:

  • The Labour Court's award, which found the dismissal illegal and unjustified and directed reinstatement of Mani Ram with continuity of service, stands as the operative outcome reflected in the judgment dismissing the petition.
  • The petitioner is to pay costs of the petition.

Broader implications:

The opinion explains and applies established principles regarding the necessity of placing an expert's report on the record when that report forms the basis for an adverse finding, and it clarifies that a vague charge cannot be the basis for a charge attracting a dismissal-level penalty under Standing Order 20(j) if it does not concretely allege repeated negligence. The opinion does not assert that it is laying down a novel precedent beyond its application of those principles to the facts; no broader new legal rule is announced beyond the reasoning applied to the case at hand.

    Shanker Flour Rice & Dal Mills, Bareilly, Through Sri Rameshwar Nath (Petitioner) v. The Labour Court, Lucknow And Others (S).

    Pathak, J.:— The petitioner, Messrs Shanker Flour, Rice and Dal Mills, Bareilly is a partnership firm carrying on the business of flour milling. On September 12, 1960 it framed three charges against one of its workmen, Mani Ram, the charges being:—

    “(1) That he demanded Rs. 2 as Subscription for the Union from Sri Sahib Singh, Chaukidar, on 30th August, 1960 in the Karkhana and on his refusal to pay the same quarrelled with him and held out threats.

    (2) That when Sri Sahib Singh did not pay the subscription he was threatened and in order to harass him, began to heap refuse in front of his quarter from 3rd September, 1960 and on his protest did not stop it.

    (3) That on account of his negligence there was a breakdown in the Boiler from 19th August, 1960 to 23rd August, 1960 and thereafter the working of the engine was also adversely affected and from the investigation of it all from an outside engineer it was found that the defect in the working of the boiler was there from several days before the breakdown and as a result of the accumulation of those defects there was a breakdown which affected adversely the production in the factory and that it was deliberate negligence on his part in looking after the engine and the boiler which resulted in these defects.”

    2. The domestic enquiry held by the Management found that the second charge was not made out against the workman but that he was guilty of the first and third charges. The Enquiring Officer recommended the workman's dismissal. On October 14, 1960 the petitioner dismissed Mani Ram from its service. An industrial dispute was raised by the Shanker Flour Mill Worker's Union, which had espoused the cause of Mani Ram, complaining of his dismissal. It appears that the State Government deaned to refer the dispute for adjudication, subsequently, however, the dispute was deferred by it to the Labour Court for decision on the following matter:

    “Whether the employers terminated he services of their workman Sri Mani Lam, son of Sri Duli Chand, Oilman, with effect from the 14th October, 1960, regally and/or justifiably? If not, to what relief is the workman concerned entitled?”

    3. The Labour Court made its award on February 12, 1962, holding that the dismissal of Mani Ram was illegal and unjustified and directing his reinstatement with continuity of service. Aggrieved by he award, the petitioner has filed the instant petition for certiorari.

    4. The Labour Court has found that the reference of the dispute was not invalid, that the third charge was vague and in any event on the basis of the allegations contained in the charge itself the negligence was one falling under Standing Order 22(b) and not under Standing Order 20(j) and, therefore, the workman could only be censured or warned but could not be dismissed, that the charges were framed and the dismissal effected in order to victimise the workman, and that the domestic enquiry suffered from a serious defect in that the report of the expert, Kedesia, on the basis of which the workman had been accused of negligence under the third charge had not been filed on the record and Kedesia had not been produced. Further, the Labour Court found that in awarding the punishment of dismissal the petitioner did not take into account, as it was bound to, the previous record of the workman.

    5. A number of contentions have been raised on behalf of the petitioner.

    6. It is urged that it was not necessary to produce the expert, Kedesia, in the domestic enquiry because Rameshwar Nath, a partner of the petitioner firm, had testified as to the damage found in the boiler and his testimony was sufficient for the purpose of enquiry. Reliance has been placed upon R. v. Deputy Industrial Injuries Commissioner, Ex Parte Moore . 1965 1 A.E.R 81.. In my opinion, this contention is not well-founded. It is true that in certain circumstances it may not be necessary to obtain the direct testimony of the expert himself. But it is essential, before you find of the basis of the report of that expert that a workman has been guilty of negligence, that the report itself be on the record. Unless that report forms part of the record, it is not possible for the workman concerned to indicate the possible flaws in the report, or to show that upon a proper understanding of it no negligence can be attributed to him. What Rameshwar Nath has done in the present case is to set out his understanding of the report. That is not the same thing as the report itself. In the case cited by learned counsel for the petitioner, the opinion of the doctors formed part of the record before the Tribunal and the Court of Appeal found that the parties had abundant opportunity, of which they availed themselves, to comment on the opinion which had been expressed. I am of the view that the Labour Court was justified in its conclusion that there was a serious lacuna in the domestic enquiry.

    7. The next contention is that the workman had been rightly charged under Standing Order 20(j) and that the Labour Court erred in holding that the appropriate provision was Standing Order 22(b). Standing Order 20(j) provides:

    “20. The following acts or omissions will be treated as misconduct:—

    ……………………..

    (j) Negligence or neglect of work repeated on not less than three occasions within six months.

    ……………………..

    8. For such an act or omission, the employer was empowered to dismiss the workman.

    9. Standing Order 22(b) reads:

    “22. Workmen may be fined or alternatively be given a censure or warning notice if found guilty of any of the undernoted acts or omissions, provided that for offences under Standing Order 22(b) and Standing Order 22(d) a censure or warning notice only may be issued:—

    (a) ………………………….

    (b) Negligence in work or neglect of work …………………………..

    10. If the charge falls under Standing Order 20(j) and is found to have been proved, the workman is liable to be dismissed, but if the matter falls under Standing Order 22(b) the only punishment which can be imposed is one of censure or of warning. It is urged that having regard to the circumstances it cannot be said that the case is one of a single act of negligence or neglect of work. Consequently, the submission goes, the charge could not be framed with respect to a misconduct referred to in Standing Order 22(b). The difficulty in deciding whether the charge alleges a misconduct under Standing Order 20(j) or under Standing Order 22(b) lies in the vague terms in which it has been couched. The charge merely recites that the defect in the working of the boiler, occasioning its breakdown, had been in existence for several days, and that there had been an accumulation of defects during the period preceding the breakdown. It is not clear whether the defect led automatically to the accumulation of subsequent defects, in which case it may well be that it was only the initial defect which had been occasioned by the negligence of the workman. It may, on the other hand, be that the subsequent defects were such that the initial defect was only one of the initiating causes and they could have been prevented if the workman had not been negligent. The Labour Court has characterised the charge as vague, and in my opinion quite rightly. Had the charge clearly stated how the workman had been negligent in relation to the defects which had occasioned the breakdown of the boiler, it could have been possible to determine whether the negligence was confined to a single act or omission or was attributed to repeated acts or omissions.

    11. As regards the finding that the action taken against the workman was vitiated by the petitioner's desire to victimise him, no submission has been made before me questioning that finding. All that is said is that the objection was never raised before the domestic enquiry and should not have been allowed to be raised before the Labour Court. That is an objection which should have been raised by the petitioner before the Labour Court. The objection was not raised there, and I am not inclined to permit the petitioner to raise it now.

    12. The last contention is that it was not open to the State Government, having once refused to refer the dispute for adjudication, to change its opinion and make the reference leading to the instant award. The argument is that the State Government applied its mind to the question whether it should refer the dispute in the exercise of its powers under Sec. 4-K of the U.P Industrial Disputes Act, and that having considered that question and having decided not to make a reference, it had exhausted the power conferred upon it by Sec. 4-K. Sec. 4-K, it is pointed out, confers the powers to refer a dispute and must be considered to imply the power not to refer the dispute. The State Government, it is said, exercised its power under Sec. 4-K and decided not to refer the dispute. It could not subsequently exercise the power, which had exhausted itself. In my opinion, there is no force in this contention. Sec. 4-K provides:—

    “4-K. Where the State Government is of opinion that any industrial dispute exists or is apprehended, it may at any time by order in writing refer the dispute or any matter appearing to be connected with, or relevant to, the dispute to a Labour Court……”

    13. The power conferred by Sec. 4-K is to refer a dispute for adjudication. If a reference is made, it is evident that the power has been exercised. If no reference is made, it clearly shows that the power has not been exercised. It is only when a reference is made that the power conferred by Sec. 4-K can be taken to have been exercised. The refusal to make the reference does not entail the exercise of any power under Sec. 4-K. It is true that Sec. 4-K provides that the State Government “may … refer the dispute”, and that it is open to it, therefore, not to refer the dispute. But that does not mean that if it does not refer the dispute it has exercised the power conferred by Sec 4-K. The power contemplated by Sec. 4-K is a power to make a reference only. No power was necessary to enable the State Government not to make a reference. Before the statute was enacted, no duty rested upon the State Government to refer a dispute for adjudication. Had such duty been imposed and the Legislature intended that the State Government should be relieved of that duty, the statutory provision giving an option to the State Government in that behalf could be considered as a grant of power to the State Government to decide against the performance of that duty. The position is entirely different here. The State Government for the first time was entrusted with the power to refer an industrial dispute for adjudication. It is a grant of positive power; the power to do something, the power to make a reference. It is only when the State Government makes a reference that it can be said that the power under Sec. 4-K has been exercised.

    14. The power conferred upon the State government by Sec. 4-K is plainly administrative in its nature. It is always open to in authority enjoying administrative power to revise an earlier decision and come to different decision subsequently. So long as it does so within the confines of the grant of the power, and acts neither mala fide nor arbitrarily, no fault can be found with the exercise of that power. In the instant case, moreover, it appears that after the State Government decided not to refer the dispute, the Hind Mazdoor Sabha brought certain facts to its notice, on which the State Government directed an enquiry through the Regional Assistant Labour Commissioner, Bareilly, and the Assistant Labour Commissioner, Kanpur, and it was after receiving their reports that it decided to make the reference.

    15. In my judgment, this petition cannot succeed. It is dismissed with costs.

    Petition dismissed.

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    Shanker Flour Rice &... v. The Labour Court, Lu...
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