IN THE HIGH COURT OF GUJARAT AT AHMEDABAD SPECIAL CIVIL APPLICATION No 8054 of 1988 with SPECIAL CIVIL APPLICATION NO. 8174 OF 2001 For Approval and Signature: Hon'ble MR.JUSTICE K.M.MEHTA ============================================================ 1. Whether Reporters of Local Papers may be allowed : YES to see the judgements? 2. To be referred to the Reporter or not? : YES 3. Whether Their Lordships wish to see the fair copy : NO of the judgement? 4. Whether this case involves a substantial question : NO of law as to the interpretation of the Constitution of India, 1950 of any Order made thereunder? 5. Whether it is to be circulated to the Civil Judge? : NO -------------------------------------------------------------- DEEPAK NITRITE LTD. Versus N H RANA -------------------------------------------------------------- Appearance: 1. Special Civil Application No. 8054 of 1988 MR V.B. PATEL, SR. ADVOCATE WITH MR. DG CHAUHAN for Petitioner No. 1 PARTY-IN-PERSON for Respondent No. 1 MRS KETTY A MEHTA for Respondent No. 1 MR BB NAIK for Respondent No. 1 -------------------------------------------------------------- CORAM : MR.JUSTICE K.M.MEHTA Date of decision: 28/12/2001 C.A.V. JUDGEMENT 1. Deepak Nitrite Ltd.-petitioner has filed this petition under Articles 226/227 of the Constitution of India praying for a writ of certiorari or any other appropriate writ, order or direction quashing and setting aside the judgement and award dated 30.5.1988 passed by the Labour Court, Baroda, in complaint No. 4/1981. The Labour Court by the impugned order allowed the application of respondent Mr. N.H. Rana and directed the petitioner that Mr. N.H. Rana-respondent workman be reinstated in services and deemed to be continued in service. However, increment for the year 1982-83 may not be given in this behalf. In view of the earlier proceedings in Special Civil Application No. 4496 of 1981 regarding arrears of salary, the court did not pass any order. The court also quashed and set aside the order of dismissal imposed against Mr. Rana in this behalf. 2. The facts giving rise to this petition are as under: 2.1 The petitioner Company is manufacturing inflammable and hazardous materials like Sodium Nitrate, Nitrate DNPT and Nitrate Acid etc. In view of the inherent danger in the manufacturing of the said goods, the Company has framed Safety Rules and has strictly prohibited smoking in some part of the factory. 2.2 The respondent was the General Secretary of the Union on the factory site at the relevant time. One Mr. J.B. Prem was the Vice President of the Union. The relation between the petitioner company and the Union of the workmen were cordial and happy at all material time. A settlement took place for the period 1.4.1979 to 31.3.1982 governing the conditions of service of the employees governed by the said settlement. Under the settlement the Union was not to make any demand involving financial burden during the subsistence of the settlement. 2.3 It has been stated in the petition that despite of this settlement, sometime in August, 1980, the Union made unreasonable demand of ad-hoc increase of Rs. 150/and immediate interim relief towards the ad hoc increase. It appears that the Union was having some negotiations with the Management during August to November, 1980. The management did not accede to the demand of ad hoc increase and instant interim relief. 2.4 It has been stated in the petition that thereafter on 15.12.1980 the respondent led some 50 to 60 workers to prevent staff bus going out to leave the staff including lady employees to their respective home and the vehicles of the contractor. This was a sort of gherao. It lasted for about three hours. In connection with this four workmen including the respondent were charge-sheeted and suspended. 2.5 Being aggrieved and dissatisfied with the charge-sheet served on the four workers, the Committee of the Union appears to have taken a decision to strike work. In pursuance of the said decision, on. 6.1.1981 in the third shift at 11.00 p.m. the respondent and the said Mr. J.B. Prem led and incited strike, prevented loyal workers from going on duty by holding out threats and shouting slogans etc. The strike was continued from 6.1.1981 to 14.1.1981. In the strike, the respondent and Mr. J.B. Prem admittedly took prominent and leading part. 2.6 The respondent along with six others including the said Mr. J.B. Prem were given charge-sheets dated 16.1.1981 for the grave and serious misconduct committed by the respondent. The charges levelled against the respondent were that the respondent has instigated and incited other employees for restoring to illegal and unjustified strike. The respondent has also intimidated /threatened other workmen and supervisory personnel and tried to prevent them from joining duties. The respondent has also obstructed company's contractors' personnel and intimidated/threatened them. It was also stated that the respondent has obstructed movement of Company's vehicles and vehicles carrying goods to be brought in and moved out of the factory premises. Thus, the charges are that for specific leading and resorting to strike, instigating and inciting the workers for illegal strike and also intimidating / threatening other workmen and supervisory personnel and to prevent them from joining duties. The management held inquiry against for the charges whereas the witnesses were examined in the presence of the respondent. He was given full opportunity to defend himself and after holding legal and proper enquiry and in view of the proved charges, the respondent and seven others were dismissed from service by an order dated 4.6.1981. 2.7 The learned counsel for the petitioner submitted that except the charge sheeted employees, the other workmen resumed work on 11.1.1981 on furnishing good conduct bond. They were mere participants in the illegal strike. Mr. Prem's dismissal was upheld by Labour Court and his Special Civil Application and Special Leave Petition were dismissed. 2.8 It was further submitted that at the relevant time, a Reference No. 222 of 1981 was pending before the Labour Court, Baroda. In view of the pendency of the said reference on 11.6.1981, the respondent and six others who were dismissed, filed a complaint No. 4/81 challenging breach of Section 33 of the Industrial Disputes Act and prayed for reinstatement on their original posts with backwages and with consequential benefits. Mr. Subhash V. Pandya was not a complainant in Complaint No. 4 of 1981. Mr. Pandya filed a separate complaint No. 3 of 1981 which was withdrawn subsequently on 2.8.1982. 2.8A On 11.6.1981, the petitioner Company filed an application No. 9 of 1981 for approval under Section 33 of the I.D. Act against the concerned workmen including the respondent. The Labour Court by its order dated 14.10.1981 dismissed complaint No. 3 of 1981 and 4 of 1981 as not maintainable. 2.9 Being aggrieved and dissatisfied with the aforesaid order, on 11.11.1981 the concerned employees filed Special Civil Application No. 4486 of 1981 for setting aside the order dated 14.10.1981 passed by the Labour Court. During the pendency of the said petition, the parties had arrived at an amicable settlement. In view of the aforesaid settlement, this court passed the following order dated 25.2.1982 in Special Civil Application No. 4496 of 1981. "The parties have arrived at an amicable solution as per the agreement under their signatures placed on record in the following terms: The complaint 3/81 and 4/81 before the Labour Court should be decided on merits as if it is the industrial dispute under Section 10(1) by the Labour Court and approval/permission application No. 9/81 will be decided on merits. Fro the date of dismissal to the date of final award which may be passed by the Labour Court in Complaint 3/81 and 4/81 the respondent will pay the wages to all the petitioners as offered by him in his letter dated 11.6.1981 within week's time and regularly thereafter. Both the parties agree not to raise any technical points regarding the breach of Section 33 of the I.D. Act and about the maintainability of the application of permission/approval in further proceeding before the Labour Court. This should be without any prejudice to the respective contentions on merit of the parties before the Labour Court." 2.10 Thereupon, the approval application was withdrawn on 21.4.1982 in view of the order passed by this court in Special Civil Application No. 4496 of 1981 under which the complaint Nos. 3/81 and 4/81 were to be disposed of by the Labour Court as if the same were Reference under Section 10(1) of the I.D. Act. 2.11 It may be noted that in view of the aforesaid circumstances as settlement dated 11.6.1981 Mr. Rana was paid full salary of Rs. 56,250/- during the period commencing from 4.6.1981 to 31.5.1988 as if he was in employment and thereafter from 1.6.1988 to 31.7.2001 Mr. Rana was paid Rs. 1,06,650/- under the provisions of Section 17B of the I.D. Act. 2.12 Before the Labour Court the original enquiry papers were produced at Exh. 56 (page 33, para 8 of the award). However, by a joint pursis at Exh. 68 the parties requested the Labour Court that it was not necessary to decide the propriety of the enquiry held by the management and that the court may decide the reference on the basis of the evidence that may be led before it. (page 33 para 9). The petitioner management led evidence before the Labour Court and on the basis of the evidence before it, the Labour Court has held that: (i) The Company (i.e. petitioner herein) had the right to hold inquiry in respect of the charge in relation to the incident of 15.12.1980 and that it was excessive and improper ..........for the workmen to feel highly insulted for charge-sheeting the four workmen. The concerned workmen could have defended themselves. (page 39). (ii) Shri N.H. Rana had admitted that he had led the incident that took place on 15.12.1980. (page 59). (iii) That Shri Rana admits that he was shouting slogans (page 62). (iv) That Shri Rana and Shri Prem had taken prominent and leading part in the strike which commenced on 6.1.1981 and continued upto 14.1.1982 (page 37, 38) (v) That the charges against Shri Rana of preventing incoming and outgoing vehicles on 15.12.1980 is proved (page 102-103) (vi) That the strike was during the currency of the settlement. It was to remain in force from 1.4.1979 to 31.3.1982 (Exh. 122). Therefore the strike could not be said to be legal nor could it be said to be justified. (Pages 39 and 40). (vii) Referring to the charges regarding strike during 6.1.1981 to 14.1.1981 the Labour Court has held that there is no dispute that Mr. Rana and Mr. Prem had taken leading part in the strike (pages 37-38). (viii) The fomenting and resorting to an illegal strike or to take part in such illegal strike is a misconduct (page 47, para 18). (ix) That the charges against Shri Rana for illegal and unjustified strike from 6.1.1981 to 14.1.1981 and inciting and instigating the workers to strike and taking leading part is proved (page 102). 2.13 Shri V.B. Patel, learned senior counsel with Mr. D.G. Chauhan for the petitioner submitted in spite of the aforesaid finding arrived at by the Labour Court, the Labour Court has under misconception of law on the point and wholly erroneous approach, mechanically, given direction for reinstatement of Shri Rana on his original post with continuity of service without back wages. The Labour Court considered the two events, one of 5.12.1980 and another of illegal and unjustified strike from 6.1.1981 to 14.1.1981 accompanied by instigation, inciting and preventing loyal workers from reporting work in isolation without appreciating seriousness of charges and substituted punishment of dismissal by stoppage of two increments for the year 1982 - 1983 with permanent effect and administered warning reprimanded for the misconduct of stoppage of vehicles on 5.12.1980 (page 112-113). 2.14 It was further submitted that Mr. Rana has already been paid full salary from the date of dismissal till the date of award and during the pendency of the petition he has been paid wages last drawn as provided under Section 17-B of the I.D. Act. Therefore, there was no question of making order for backwages. 2.15 The learned counsel for the petitioner further submitted that on the basis of the findings the Labour Court ought to have upheld the punishment of dismissal of Mr. Rana having regard to the gravity of the misconduct and his culpability. 2.16 The learned counsel for the petitioner further submitted that the Labour Court took into account the wholly irrelevant matter and applied the rule of thumb that the same treatment should be meted out to the respondent as was given to Mr. Pandya and therefore the order must fail. The learned counsel further submitted that the Labour Court has travelled beyond its jurisdiction and against the respondent by reference to the subsequent reinstatement of Mr. Pandya. It was further submitted that the respondent was guilty of inciting strike on 15.12.1980 and the strike during 6.1.1981 to 14.1.1981. The respondent had admittedly taken leading and prominent part during both the strikes and the order of dismissal against the respondent merits his dismissal. 2.17 It was submitted that once misconduct meriting dismissal is held proved, as it has been, the Labour Court was left with no discretion under Section 11A unless one can reasonably say that the punishment was shocking and disproportionate to the charges levelled against him. It was further submitted that the petitioner is manufacturing hazardous and dangerous chemicals like ammonium nitrate, concentrated nitric acid, D.N.P.T. Guanidine nitrate and other chemicals which were explosive and most of them are used by Government of India as raw material for defence purpose and are also used by Government Chemical Factories like I.P.C.L. Some of them are used as manufacture of Pharmaceutical/Medicine. 2.17A The learned counsel for the petitioner further submitted that some of the chemical products which are manufactured are based on continuous manufacturing process, namely, process of manufacturing products is continuous and the manufacturing process continued for 24 hours. He therefore submitted that even if for a short period the manufacturing process is stopped, it will spoil the entire continuous manufacturing process and thereby it will cause tremendous loss to the manufacturing unit. In view of the same, the learned counsel for the petitioner submitted that if one takes into consideration this aspect then activities of stopping the manufacturing of production cannot be condoned lightly. 2.18 It was further submitted that it was its duty to uphold the order of dismissal instead of the the Labour Court interfering with on irrelevant and flimsy grounds and abused its discretionary jurisdiction. 2.19 The learned counsel for the petitioner further submitted that Section 23 of the I.D. Act prohibits strike during any period in which a settlement is in operation in respect of the matters covered by the settlement. Under Section 24, a strike is illegal if it is commenced in contravention of Section 23 of the Act. Section 26, inter alia, provides that any workman who commences, continues or otherwise acts in furtherance of, a strike which is illegal under the Act, shall be punishable with imprisonment for a term which may extend to one month or with fine which may extend to Rs. 50/- or with both. Section 27 provides punishment of a person who instigate or incites others to take part in, or otherwise acts in furtherance of, a strike which is illegal shall be punishable with imprisonment for a term which may extend to 6 months, or with fine which may extent to Rs. 1,000/- or with both. The strike envisaged by these two Sections, namely, Section 26 and 27, is clearly the one which is illegal under Section 24 read with Section 23. Section 29 lays down the penalty for breach of settlement. It is punishable with imprisonment for a term which may extend to six months or with fine or with both. It is, therefore, an offence for any person on whom a settlement is binding under the Act to commit a breach thereof and the legislature has viewed it to be a more serious offence, for, it has a higher punishment of imprisonment extending to six months than the punishment for commencing etc. an illegal strike under Section 26. Likewise, to instigate or incite others to take part in a strike which is illegal, is considered more serious offence as it prescribes higher punishment of 6 months. In such a situation, Standing Order 24 of Model Standing Order would come into operation. Model Standing Order No. 24 is as under: "24. The following act and omissions on the part of the workman shall amount to misconduct - (a)............ (b) Going on an illegal strike or abetting, inciting, instigation or acting in furtherance thereof; (c) to (y)......." 2.19A Under this Standing Order fomenting and resorting to illegal strike and inciting and intimidating others to join such a strike and preventing loyal workers from joining duty would amount to serious misconduct for which management was entitled to take disciplinary action, and imposing penalty, including dismissal. Evidence clearly disclose and indeed, it has been found by the labour Court that Shri Rana had admittedly taken leading part in such illegal strike, and shouting slogans as also intimidating and inciting other workers to join such a strike and further that he is guilty of preventing loyal workmen from reporting to work. It has been noticed hereinabove that the misconduct of inciting, intimidating and preventing loyal workers from reporting to work is even more pernicious and vicious than the illegal strike. It is made criminal offence and punishable as stated above. In the circumstances, the management was justified in dismissing Shri Rana for such serious misconduct. 2.19B Standing Order 25 provides punishment, among others dismissal and the procedure to be followed. 2.20 It was submitted that the strike is not only prohibited in certain circumstances but also it is illegal and it is made punishable as stated above. Such misconduct is serious as acts subversive of discipline entailing dismissal. That the misconduct held proved is sufficient to dismiss an employee without shedding tears. That the cases cited by the Labour Court on page 48 are not apposite and are totally irrelevant, as they merely lay down that mere participation in illegal strike is not per se punishable with dismissal. It is submitted that in the case on hand, Shri Rana is not only found guilty of leading illegal strike but is also guilty of fomenting and resorting to illegal strike, inciting and instigating such strike and further shouting slogans and preventing loyal workers from reporting to work. The strike was total and Shri Rana had admittedly taken leading part. In the circumstances, there was no scope for taking lenient view. Such activities are subversive of discipline and has to be appropriately punished. The punishment has to be decided in light of the findings set out in (para 9), the specific circumstances and the law applicable referred to in para 12. 2.21 The learned counsel for the petitioner has relied on the judgement of the Hon'ble Supreme Court in the case of BENGAL BHATDEE COAL COMPANY VS. RAM PROBESH SINGH reported in 1963 I LLJ 291/294 = AIR 1964 SC 486 . In this case the Constitution Bench of the Hon'ble Supreme Court in similar case justified dismissal for the kind of misconduct held proved against Shri Rana is justified. It was further submitted that dismissal of workmen who physically obstructed other workmen who were willing to work was considered as serious misconduct and the punishment of dismissal would be perfectly justified. 2.22 He further relied on the judgement in the case of WORKMEN OF the MOTOR INDUSTRIES COMPANY LTD. VS. MANAGEMENT OF MOTOR INDUSTRIES COMPANY LTD. AND ANOTHER reported in 1969 SC 1280. In this case the Hon'ble Supreme Court on page 1283 at para 4 has inter alia held thus: "....The settlement was a package settlement by which the management and the workmen, through their association, arrived at certain terms in the presence of the conciliation officer. The settlement, besides settling the demands contained in the said charter of demands, sets out the necessity of harmonious relations and of co-operation between the management and the workmen so as to promote higher and better production. It was to achieve this object that direct action on the part of either of them such as a strike by the workmen and a lock out by the employer without notice was prohibited......" 2.22A The learned counsel submitted that in that case the concerned workmen were found guilty of inciting a strike which was illegal as envisaged by the relevant Standing Order were dismissed. The Hon'ble Supreme Court upheld their dismissal. Both these cases are squarely applicable to the facts of the petitioner's case. I: SUBISSIONS ON SEC. 11A (POWER OF LABOUR COURT): 2.23 He further submitted that the misconduct alleged against Shri Rana stands proved as stated in para 9 and found by the Labour Court. (see page 102, para 57). In such a situation, in view of the gravity of the misconduct and the degree of culpability on the part of Shri Rana, the Labour Court has exceeded its jurisdiction under Section 11A of the I.D. Act in altering or substituting the punishment of dismissal awarded by the management by adopting an easy expedient of considering charges in isolation and on wholly irrelevant considerations such as (i) That the incident of 15.12.1980 was light and short-lived. (p. 64) (ii) That there is no evidence about violence, threat or pressure (page 52-55) (iii) That it was workers agitation (page 55) (iv) That he is acquitted in criminal case (page 52) (v) Persuading and requesting the co-workers to join strike is but natural (page 55) (vi) That the management has not fulfilled the terms of para 4 of the settlement dated 17.6.1982 at Exh. 170 (page 40) (vii) That there was no loss of production and the misconduct held proved was pardonable (pages 65) (viii) The misconduct held proved was pardonable (page 64) (ix) That there was no loss of production (page 65) (x) That the management should have been graceful (page 65) 2.23A The learned counsel for the petitioner submitted that all these reasoning given by the Tribunal are absolutely incorrect and the Tribunal exceeded its jurisdiction under Section 11A of the Act. He has relied on the evidence on record and submitted the following : (i) That the duration of the episode is totally irrelevant. It is the gravamen of charge which have to be considered. The misconduct involved in that episode is by itself serious which would call for deterrant punishment. It is in that incident of 15.12.1980 there was violence. It may be noted that there is evidence of Keshav Rao Pradhan (Exh. 118) page 51-52 para 22 who has said in his evidence that the people from the crowd had thrown stones and two policemen were injured. It is too much to expect the witness to give the names of the policemen. This is the reason given by the Labour Court for holding that there was no violence. The Labour Court failed to appreciate that in domestic enquiry standard of proof is not strict. Evidence of probative value is enough. In the circumstances, the Labour Court erred in holding that there was no violence. 2.24 The learned counsel for the petitioner submitted that substitution of punishment by the court treating that incident in isolation is not warranted. The charges with regard to that incident of 15.12.1980 ( page 18) even taking in isolation, serious enough to warrant dismissal. 2.25 The learned counsel for the petitioner further relied on the judgement of the Hon'ble Supreme Court in the case of THE ORIENTAL TEXTILE FINISHING MILLS, AMRITSAR VS. THE LABOUR COURT, JULLUNDUR AND OTHERS reported in 1972 SC 277 in which on page 283 at para 12, the Hon'ble Supreme Court has observed as under:- "The learned advocate for the respondents however urges that even where the strike is illegal in order to justify the dismissal or the order terminating the services of