Case: Management Of Kairbetta Estate,Kotagiri Vs. Rajamanickam And Others

2. The material facts leading to the respondents complaint must be set out briefly at the outset. On July 26, 1957, Mr. Ramakrishna Iyer, the appellants Manager, was assaulted by some of the workmen of the appellant. He suffered six fractures and had to be in hospital in Coonoor and Madras for over a month. The appellants staff working in the division known as kelso Division was also threatened by the workmen. As a result of these threats three members of the staff wrote to the appellants on July 27, 1957, that they were afraid to go down to the lower division and it was impossible for them to work there because their lives were in danger. They added that the workers in the lower division were threatening them that they would murder them if they worked in the lower division. On receiving this communication from its staff the appellant notified on the same day that the Kelso Division would be closed from that day onwards until further notice. This notice referred to the brutal assault on the Manager and to the threat held out against the field staff who were reluctant to face the risk of working in the lower division. It appears that the Kelso Division continued to be closed until September 2, 1957, on which date it was opened, as a result of conciliation before the labour officer, when the respondents gave an assurance that there would not be any further trouble. The claim for lay off is made for the said period during which the division remained closed between July 28 to September 2, 1957.3. Soon after the division was closed the respondents made a complaint to the Labour Court (No. 43 of 1957) under S. 33A of the Act in which they alleged that they had been stopped from doing their work without notice or enquiry and claimed an order or reinstatement with back wages and continuity of service. At the hearing of the said complaint the appellant raised a preliminary objection that the closure in question was a lock out and that it did not amount either to an alteration of conditions of service to the prejudice of the workmen nor did it constitute discharge or punishment by dismissal or otherwise under cls. A and B of S. 33 respectively, and so the petition was incompetent. This preliminary objection was upheld by the Labour Court and the complaint was accordingly dismissed on November 30, 1957.4. Thereafter the present complaint was filed by the respondents on January 31, 1958, under S. 33C of the Act. In this complaint it was stated that the respondents were refused work from July 28 to September 2, 1957, "by declaring a lock out of a division of the estate" and the claim made was that, as the management for their own reasons did not choose to run the division during the said days and laid off the respondents, the respondents were entitled to claim lay off compensation under S. 25C of the Act. Against this complaint the appellant raised several contentions. It was urged on its behalf that the complaint was incompetent under S. 33C and that the Labour Court had no jurisdiction to deal with it. It was also contended that the closure of the division amounted to a lock out which under the circumstances was perfectly justified and as such the respondents were not entitled to claim any lay off compensation. The Labour Court rejected the preliminary objection as to want of jurisdiction and held that the complaint was competent under S. 33C. On the merits it found in favour of the respondents and so it directed the appellant to pay to the respondents the lay off compensation for the period in question. It is this order which is challenged before us in the present appeal; and the same two questions are raised before us.

Court's reasoning:
It is clear that the lay off takes place for one or more of the reasons specified in the definition. Lay off may be due to shortage of coal or shortage of power or shortage of raw materials or accumulation of stocks or breakdown of machinery or any other reason. "Any other reason" to which the definition refers must, we think, be a reason which is allied or analogous to reasons already specified. It has been urged before us on behalf of the respondents that "any other reason" mentioned in the definition need not be similar to the preceding reasons but should include any other reason of whatsoever character for which lay off may have taken place; and in support of this argument reliance is placed on S. 25E (iii). Section 25E deals with three categories of cases where compensation is not liable to be paid to a workman even though he may have been laid off. One of these is prescribed by S. 25E (iii); if the laying off is due to a strike or slowing down of production on the part of workmen in another part of the establishment no compensation has to be paid.The argument is that laying off which is specified in this clause has been excepted because, but for the exception, it would have attracted the definition of S. 2 (kkk) and would have imposed an obligation on the employer to pay lay off compensation. That no doubt is true: but we do not see how the case specified in this clause is inconsistent with the view that "any other reason" must be similar to the preceding reasons specified in the definition. If there is a strike or slowing down of production in one part of the establishment, and if lay off is the consequence, the reason for which lay off has taken place would undoubtedly be similar to the reasons specified in the definition. We are, therefore, satisfied that the expression "any other reason" should be construed to mean reason similar or analoguous to the preceding reasons specified in the definition.Stated broadly lay off generally occurs in a continuing business, whereas a lock out is the closure of the business. In the case of a lay off, owing to the reasons specified in S. 2 (kkk) the employer is unable to give employment to one or more workmen.In the case of a lock out the employer closes the business and locks out the whole body of workmen for reasons which have no relevance to causes specified in S. 2 (kkk). Thus the nature of the two concepts is entirely different and so are their consequences. In the case of lay off the employer may be liable to pay compensation as provided by S. 25 (C), (D) and (E) of the Act; but this liability cannot be invoked in the case of a lock out. The liability of the employer in cases of lock out would depend upon whether the lock out was justified and legal or not; but whatever the liability, the provisions applicable to the payment of lay off compensation cannot be applied to the cases of lock out.Therefore, we hold that the lock out in the present case was not a lay off, and as such the respondents are not entitled to claim any lay off compensation from the appellant. Incidentally we would like to add that the circumstances of this case clearly show that the lock out was fully justified. The appellants Manager had been violently attacked and the other members of the staff working in the lower division were threatened by the respondents. In such a case if the appellant locked out his workmen no grievance can be made against its conduct by the respondents.