Hukumchand Jute Mills Ltd. v. Labour Appellate Tribunal .

The Judgment of the Court was as follows:

Sinha, J.:— The two applications relate to a decision of the Labour Appellate Tribunal dated the 4th February, 1956. This was in appeal against an award of an Industrial Tribunal, dated 31st August, 1954, published in the Calcutta Gazette on the 23rd September, 1954.

2. The facts are briefly as follows:

One Balaram Singh was employed by the Hukumchand Jute Mills Ltd. (hereinafter referred to as the ‘Company’) as a Time Keeper in the Shifter Section Spinning Department, of Mill No. 1. On the 3rd January, 1953 he was served with a charge sheet comprising of ten different charges. After hearing him, the General Manager of the Company found him guilty of all the charges and he was dismissed by an order dated 31st January 1953. Thereupon, Singh appealed against the said order to the Managing Agents and after hearing him the order of the General Manager was upheld on 27th February, 1953. On 24th September, 1853 the dispute between Singh and the Company was referred to the adjudication of the respondent No. 2, the Second Industrial Tribunal. The only dispute referred was as follows:

“Is Balaram Singh entitled to reinstatement”?

3. The tribunal thereupon entered upon the adjudication. The only issue raised was “Is Shri Balaram Singh entitled to reinstatement”? The tribunal came to the following findings:

(1) The management proceeded in the matter in good faith.

(2) That there has been no violation or the rules of natural justice.

(3) That, so far as the charges preferred by the Company were concerned, charges Nos. 1 to 8 had not been established but those relating to charges 9 and 10 were established, and that being so, the action taken by the management in dismissing Singh was not fully justified.

(4) But his reinstatement would not tend to promote harmonious relations between the parties, but would have the opposite effect, the parties having lost confidence in each other.

(5) That Singh was not entitled to reinstatement.

4. The tribunal thereupon proceeded to state as follows:

“This finding however does not fully dispose of the issue. It remains now to be seen what other relief if any, the employee is entitled to. Shri Ghosh on behalf of the Company, raised a short point here. He said that the issue of reinstatement having been decided by the Tribunal, it is no more competent to adjudicate upon other matters connected therewith, having regard to the issue framed. This contention overlooks the provisions of section 10(4) of the Industrial Disputes Act, which says that the Tribunal shall confine its adjudication to the points referred to it and matters incidental thereto.

It is an established principle of law that where a Court or Tribunal is called upon to decide a matter, it must decide the matter in a complete way, an order that the rights of the parties may be settled. The Court or Tribunal therefore should give appropriate reliefs which would flow from its findings (1954 L.A.C, page 5). This contention therefore fails. Shri Balaram Singh, however, is entitled to adequate compensation for loss of employment as envisaged in the aforesaid case. He has put in a little over 10 years of service. He is allowed to get (i) one month's total emoluments, at the rate last drawn, for each completed year of service; (ii) Provident Fund dues including the Company's contribution due to him; and (iii) any earned leave due.”

5. The appellate tribunal did not agree with the conclusions of the original tribunal. It held that the charges were not proved, that there was victimisation, and the order of dismissal was wholly unjustified. But the appellate tribunal upheld the order of the tribunal so far as it had refused reinstatement, upon a new point altogether. It appears that in his written statement, Singh had admitted that he received Rs. 7,000 on behalf of his brother Satyanarain who had been in the employ of the Company for 2½ years, and was dismissed by the Company. He also repeated it in his evidence. The appellate tribunal thought that the receipt of such a sum by Singh, who was a union official, was highly improper and amounted to a penal offence. They did not decide as to whether the payment was proved, but stated that if proved it was an improper payment, and if not proved, it meant that Singh had made a false accusation against his employer. In either event, he was not a fit person to be reinstated. The appellate tribunal proceeded to say as follows.

“The workman's conduct up to the date of the Tribunals order should be beyond reproach, which due to this allegation, we think, is not, irrespective of the truth being one way or the other. It is the aim of the tribunal to see correct standards of conduct being observed by employers and employees. On the case as put forth by the employer, the workman is entitled to reinstatement and was fully justified in expecting uptil this date that he deserves to be reinstated, but as we are refusing reinstatement due to the employee's own conduct in the prosecution of his case before the tribunal not connected with his Time Keeping duty, we think, the employer must pay him his full wages up to the date of this Tribunal's decision including all allowances that may have beer, due to him during this period from 5th January, 1953 the date of dismissal and loss of employment compensation at the rate of 2 months total wages for every year of completed service. We allow the appeal to this extent with Rs. 100 costs of the appeal against the said respondent”

6. Before proceeding any further, I must confess that I am unable to see how if the receipt of Rs. 7,000 was an improper industrial practice and a penal offence, was the conduct of Singh perfectly proper up to the date of the appellate order, or how he was justified in thinking up to that date that he should be reinstated, or how it he did think so, it should find the support of the appellate tribunal. The receipt of the money was prior to his dismissal by the Company.

7. However, this court is not exercising an appellate jurisdiction over the decision of the tribunals. The point is as to whether the tribunals had jurisdiction to order payment of compensation for loss of employment or similar payments, having rejected the prayer for reinstatement. The respondent No. 2, the original tribunal justified the order on the ground that it was an ‘incidental’ matter, within the meaning of section 10(4) of the Industrial Disputes Act. That section runs as follows:

“Where in an order referring an industrial dispute to a Tribunal under this section or a subsequent order, the appropriate Government has specified the points of dispute for adjudication, the Tribunal shall confine its adjudication to those points and matters incidental thereto.”

8. The question is as to what is meant by “matters incidental thereto.” A tribunal formed under the Industrial Disputes Act is a tribunal of limited jurisdiction and is severely limited by the order of reference. According to Stroud's Judicial dictionary, a thing is said to be incidental to another when it apertains to the principal thing. According to the ordinary dictionary meaning, it signifies a subordinate action. Reference was made before me to several decisions of the Federal Court and the Supreme Court, which I shall now proceed to consider. In The Indian Paper Pulp Co. Ltd. v. The India Paper Pulp Workers' Union (1) [(1949) F.C 148], it was held that section 10 of the Industrial Disputes Act, does not require that a particular dispute should be mentioned in the order of reference of the Government. It was sufficient if the existence of a dispute and the fact that a dispute was referred to the tribunal were clear from the order. It was also held that non-employment or compensation for wrongful dismissal was by itself an industrial dispute. In Bharat Bank Ltd., Delhi v. The Employees of Bharat Bank Ltd. (2) [A.I.R (1950) S.C 188], it was held that an Industrial Tribunal though not a court in the technical sense of the word, was a body discharging judicial functions. My attention has been drawn to the dissentient view of Mukherjea, J., but I do not see how that is important as it is a view that has never been followed. In any event, all that the minority view adumbrated was that the Industrial Tribunal need not decide in accordance with the ordinary law but according to what it considered reasonable and proper. But it did not lay down that the tribunal could decide what was not referred to it. The next case cited is State of Madras v. C.P Partha Sarathy (3) [A.I.R (1953) S.C 53]. Patanjali Sastri, C.J said as follows:

“Moreover it may not always be possible for the Government on the materials placed before it, to particularise the dispute in its order of reference, for situation might conceivably arise where public interest requires that a strike or a lock-out, either existing or imminent should be ended or averted without delay, which under the Scheme of the Act, could be done only after the dispute giving rise to it has been referred to a Board or a Tribunal (vide sections 10, 3 and 23). In such cases the Government must have the power, in order to maintain industrial peace and production, to set in motion the machinery of settlement with its sanctions and prohibitions without stopping to enquire what specific points the contending parties are quarrelling about …..”

9. It is thus firmly established that provided the Government is satisfied that an industrial dispute exists or is apprehended, it may make a reference. Such reference may be in specific terms or in terms as wide as possible. In this particular case, the dispute might have been referred as “An industrial dispute” which would have meant that all existing industrial disputes as would arise from the pleadings of the parties would have to be adjudicated upon or else the reference might have been in the alternative form, e.g “whether Balaram Singh is entitled to reinstatement or to any other relief.” In such a case, if the employee was not entitled to reinstatement, but to a separate and independent relief, the tribunal was competent to grant it. In United Commercial Bank v. U.P Bank Employees' Union (4) [A.I.R (1953) S.C 437], one of the disputes referred to adjudication was “Retrenchment, discharge, or dismissal of workmen after 13th June, 1949.” But below the schedule was a note: “This list is net intended to be exhaustive.”

10. In this case the tribunals ordered reinstatement, but it was urged that payment of compensation and not reinstatement was the proper relief. It was held that this was a matter for the tribunals to decide and should not be interfered with by the court. But the tribunals can not exceed the scope of the reference. It is open to Government to refer either one or more or all the disputes existing at any given point of time. Where only a specific dispute is referred, the tribunals are not called upon to exercise general jurisdiction and adjust all disputes between the parties. But what is it that was referral in this case? The only thing that was referred was as to whether Singh was to be reinstated. Reinstatement is a well-known process, and is allowable under our law. It means that the discharged employee should be put back into his former position. If a man should not be put back into his old position, that is not reinstatement at all. If he is to get compensation for wrongful dismissal or for loss of employment, then it is a relief, but quite a separate and independent relief and has nothing whatever to do with reinstatement. It is easy to see what is incidental to reinstatement. If a man has been wrongly dismissed and then reinstated, it might be necessary to provide for his wages up to the date of reinstatement. It might be necessary to provide for continuity of service or to deal with the question as to whether he is entitled to increments made in the meanwhile, or about his provident fund. But, compensation for wrongful dismissal or loss of service is a completely different thing and does not arise because a man is reinstated, but because he is not reinstated. That Singh knew about this becomes clear from the reliefs he had himself asked for in his own written statement. He never asked for compensation for wrongful dismissal or loss of service, and no such issue was raised. The question of compensation in such cases is a complicated matter and can only be decided upon evidence. Since no issue was raised, no evidence was called by either side upon this point. It would therefore be highly unjust to burden the Company with this liability which it was never in a position to dispute. The learned Government Pleader has referred me to the definition of an Award in sec. 2(b). It means an interim or final determination by an industrial tribunal of any industrial dispute or of any question relating thereto. The relationship must however re a natural and not a forced one. In my opinion, the tribunals below were entirely acting without jurisdiction in awarding compensation for wrongful dismissal or for loss of service etc., having held the only issue referred to them against the employee. Such things were not incidental or related to the dispute that was referred. In other words the tribunals in doing so exceeded their jurisdiction and the award is bad.

11. The award of the appellate tribunal is attacked by both parties. According to Singh (in C.R No. 1320 of 1956) the appellate tribunal, having upset the findings of the original tribunal had no jurisdiction to consider, what is called an ‘Extraneous’ matter namely the receipt of Rs. 7,000. I can not agree. The appellate tribunal was perfectly entitled to consider the conduct of the employee at any point of time, before ordering reinstatement. The power of reinstatement is a wide power and consequents the tribunal has a great responsibility in the matter. It is no light matter to force an employee upon an unwilling employer on the plea of industrial harmony. The conduct of an employee is plainly a relevant matter. Supposing the tribunal comes to the conclusion that the employee is a rougue or a blackguard or a thoroughly incompetent one, unable to perform his job it is ridiculous to suggest that such matters are irrelevant and the tribunal must still reinstate the worker and shut their eyes to the real state of things. But where the appellate tribunal went wrong was in exceeding the scope of the reference and deciding that which was not referred to them.

12. The result is that the rule in C.R No. 636 of 1956 must be made absolute and there will be a writ in the nature of certiorari issued quashing the decision of the appellate tribunal and the award based thereon as mentioned in the petition and a writ in the nature of mandamus issued upon the respondents directing them not to give effect to the same. The rule in C.R No. 1320 of 1956 is discharged. There will be no order as to costs in either matter.

A.K.D.G