Case: S. S. Shetty Vs. Bharat Nidhi, Ltd

1. This appeal with special leave is directed against the decision of the Labour Appellate Tribunal of India, Lucknow, confirming, on appeal the award made by the Central Government Industrial Tribunal, Calcutta in a dispute between the appellant and the respondent.2. The appellant took up service with the respondent then known as the Bharat Bank Ltd., with effect from 1st July 1944, as an Inspector at Bombay in the grade of Rs. 170- 10- 200-20-400 and was given three increments when the first increment fell due as from 1st OctoberHe was also given promotions on 1st October 1946 and on 1st October 1947, and was drawing Rs. 240 per month plus a special allowance for a servant of Rs. 30 per month at the time when he was discharged by the respondent on 5th August 1949, on the plea that he had become surplus to the requirement of theGovernment of India, Ministry of Labour had by Notification No. L. R. 2 (273) dated 21st February 1950, referred for adjudication to the Central Government Industrial Tribunal at Calcutta the disputes pending between the various banks and their employees, and the appellants case came up for hearing in the course of those proceedings before that Tribunal which held on 5th December 1050, that the order of discharge of the appellant was illegal and that the respondent should take him back in service as well as pay the appellant his arrears of salary and allowances from the date ofdirection was to be carried out within a month of the date of the publication of the award which was actually published in the Gazette of India (part II Section 3, page 1143) of 30th December 1950.3. On 30th January 1951, the respondent preferred an appeal against the said order to the Labour Appellate Tribunal, Calcutta sitting at Allahabad which by its decision dated 25th September 1951, upheld the directions given by the Industrial Tribunal and dismissed the appeal. The respondent failed and neglected to implement the decision of the Labour Appellate Tribunal within the prescribed period in spite of the appellants intimating to the respondent by his letter dated 10th October 1951, at its address at 37, Faiz Bazar, Delhi, that he was at Bombay and that he would like to know where he should report himself forthis letter he also claimed arrears of salary and allowances which had not till then been paid to him, apart from the payments made under the interim orders of the Labour Appellate Tribunal. The respondent did not send any reply to the said letter with the result that the appellant served on the respondent a notice on 5th November 1951, through his solicitors intimating that the respondent had failed and neglected to reinstate the appellant in spite of his letter dated 10th October 1951, requesting it to doappellant further intimated to the respondent that by reason of its failure to reinstate him within the prescribed period the respondent had committed a breach of the directions of the Labour Appellate Tribunal and the appellant had therefore become entitled to compensation for theappellant therefore called upon the respondent to pay to him a sum of Rs. 32,388 as the amount of compensation to which he was entitled on account of the pay he would have earned till his 55th year, i.e., upto 4th May 1960, Provident Fund contribution on pay at 6 1/4 % as allowed by the Rules of the Bank and gratuity for about 16 years from 1st July 1944, to 4th May 1960, at 1/2 months pay per year of service, adjustment being made at 6% per annum for payment, if made asamount was exclusive of other claims against the respondent such as amounts due to him under the order dated 17th February 1951, of the Labour Appellate Tribunal of India, Allahabad, arrears of salary etc., withheld by thethe respondent failed and neglected to send any reply to the said notice or to comply with the requisitions therein contained, the appellant made an application to the Government of India on 22nd February 1952 for recovery of money under S. 20 (1) of the Industrial Disputes (Appellate Tribunal) Act, 1950 (hereinafter referred to as "the Act") to which he received a reply on 13th May 1952, stating that an application for recovery of money under that section could be entertained only if it was confined to the arrears of salary and allowances from the date of his discharge upto the date of the application, and advising him to submit a revised applicationsuggestion was also made in that letter that the appellant might approach the Industrial Tribunal, Calcutta, under S. 20 (2) of the Act for a computation in terms of money of the benefit of reinstatement, as it was only when a definite sum had been so determined that action for recovery under S. 20 (1) of the Act could be taken by the Government.4. It appears that in the meantime the respondent had transferred its banking business under an agreement with the Punjab National Bank Ltd., and had also changed its name to Bharat Nidhi Ltd. By its letter dated 3rd April 1952, the respondent in its new name of the Bharat Nidhi Ltd., addressed a letter to the appellant stating that due to the transfer of its liabilities and equivalent assets to the Punjab National Bank Ltd., and the closure of all its branches in India, the appellant was surplus to itstherefore purported to give to the appellant two months notice of its intention to terminate the said award and his services in terms of S. 19(6) of the Industrial Disputes Act,The letter further proceeded to state that the appellant had not so far reported himself for duty at its office at Delhi which was the only office that it had in India since 10th March 1951, and which was its Head Office and registered office before thatAppellant replied by his Advocates letter dated 16th April 1952, pointing out that in spite of his letter dated 10th October 1951, addressed to the respondent the latter had not informed him as to when and where he should report for duty nor had it cared to respond to the same, He intimated that he had already made an application to the Government of India under S. 20 (1) of the Act and was awaiting the resultletter dated 3rd April 1952, addressed by the respondent to the appellant was under the circumstances characterized by the appellant as evidently addressed to him with some ulterior motive. The respondent by its letter dated 10th May 1952, addressed to the appellant reiterated that in spite of its asking the appellant to do so, he had failed to join its office. It stated that by its letter dated 3rd April 1952, it had clearly asked the appellant to join at Delhi but that the appellant had failed to do so and the conduct of the appellant clearly amounted to evasion of its instructions and absence fromalso stated that the notice dated 3rd April 1952 had effect from the date of receipt thereof by the appellant, viz., 9th AprilNo further reply was made by the appellant to the aforesaid letter but it appears that on 28tth June 1952, the respondent addressed a letter to the Under Secretary, Government of India. New Delhi, in answer to a communication dated 12th June 1952, addressed by the latter to it that the appellant had already been paid arrears of his pay and allowances awarded by the Tribunal, that he was further asked by it so resume duty which he had failed to do, and, in the circumstances he was being considered absent fromcopy of the letter dated 10th May 1952, addressed by it to the appellant as also a copy of the letter of the same date addressed to the Chief Labour Commissioner (Central), New Delhi were enclosed therewith for information. Nothing further transpired and on 8th October 1952, the appellant filed the petition under S. 20 (2) of the Act for computation of the money value of the benefit of reinstatement because of non-implementation of the directions contained in the award by the respondent. He claimed a sum of Rs. 47,738 computed in the manner indicated in annexure D to that petition.5. The respondent filed its written statement on 4th December 1952 wherein the only plea taken was that there was a flagrant violation by the appellant of its instructions to join duty and that there the appellant had forfeited his right to claim reinstatement and all benefits flowing therefrom. It further stated that without prejudice and with a view to close his case it has offered him salary upto 19th June 1952, by its letter dated 15th November 1952, under intimation to the Conciliation Officer Central Government, New Delhi but the appellant had not replied to therespondent further contended that the award in question was in force for only one year under S. 19 (3) of the Industrial Disputes Act, 1947, and that the same was therefore no longer in force and the respondent had already terminated the same. The claim of the appellant was therefore illegal and preposterous and the respondent prayed that the petition be dismissed with costs.The petition came up for hearing before the Central Government Industrial Tribunal at Calcutta and it was observed that there were three aspects of the cases, viz., (i) whether the respondent refused to implement the award or the subsequent decision of the Labour Appellate Tribunal by not taking the appellant in service as directed by the Tribunals (as urged on behalf of the appellant); (ii) whether it was the petitioner who failed to resume his duty in spite of having been asked to do so and thereby forfeited the right conferred upon him in terms of the award (as urged by the respondent); (iii) To what relief or compensation in lieu of reinstatement the petitioner was entitled in the peculiar circumstances in which Bharat Bank ceased functioning soon after the award of December 1950, and in the light of various other applications of other employees in which only retrenchment relief wasthe first two questions the Industrial Tribunal held in favour of the appellant and then proceeded to consider the third question viz., as to what relief or compensation in lieu of reinstatement the appellant was entitled to. After discussing the legal position it came to the conclusion that the measure of damages was that laid down under S. 95 of the Code of Civil Procedure which put it at a figure of Rs.therefore assessed the value of reinstatement asked for at the sum of Rs. 1000 and awarded that sum under S. 20 (2) of the Act. The other prayers of the appellant regarding arrears were not dealt with by the Industrial Tribunal in so far as they were the subject-matter of the application under S. 20 (1) of the Act which the appellant had already made to the Centralappellant being aggrieved by the award of the Industrial Tribunal carried an appeal to the Labour Appellate Tribunal of India at Lucknow. A preliminary objection was taken by the respondent before the Labour appellate Tribunal that the appeal was not competent under the provisions of S. 7 of the Act. This objection found favour with the Labour Appellate Tribunal and holding that no substantial question of law was raised by the award it dismissed the appeal asappellant applied for and obtained special leave to appeal against this decision of the Labour Appellate Tribunal and that is how the present appeal is before us.

Court's reasoning:
We are of opinion that these circumstances cannot be availed of by the respondent. It is no doubt true that the respondent transferred its liabilities and equivalent assets to the Punjab National Bank Ltd., some time in March 1951, The correspondence which was carried on between the appellant and the respondent however shows that in spite of such transfer to the Punjab National Bank Ltd., and the change of the name of the respondent from the Bharat Bank Ltd., to Bharat Nidhi Ltd., the respondent never contended that Bharat Nidhi Ltd., was not in a position to reinstate the appellant in its service.Having regard to the considerations detailed above it is impossible to compute the money value of this benefit of reinstatement awarded to the appellant with mathematical exactitude and the best that any Tribunal or Court would do under the circumstances would be to make as correct an estimate as is possible bearing of course in mind all relevant factors pro andhave ourselves devoted very anxious thought to this aspect of the matter and we have come to the conclusion that having regard to all the circumstances of the case it would be reasonable to compute the benefit of reinstatement which was awarded to the appellant at an amount of Rs. 12,500 (Rupees twelve thousand and five hundred only).