# BINNY LID v. 'IllEIR WORKMEN AND ANR

- **Citation:** [1972] 3 S.C.R. 518
- **Court:** Supreme Court of India
- **Decided:** 1972-02-17
- **Case number:** Civil Appeal No. 1851 of 1967
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/binny-lid-v-illeir-workmen-and-anr-5565
- **Pages:** 12

## Headnote

518
BINNY LID.
v.
'IllEIR WORKMEN AND ANR.
February 17, 1972
(C. A. VAIDIALINGAM AND G. K. MITTER, Ji.]
Industrial Dwputes Act (14 of 1947), s. 10(1)-Dlsmlssal of. employee-Natural Justice--Opportμnit:y to cross examine witness lJ.Ot givenReference by Government, after refusal to· do so
earlier-Competence
lndustnal dispute-Jurisdiction to proceed after Union withdraws support
of workman-Re-instatement, when may be ordered.
The r .. pondent was alleged to· have behaved insolently towards .a
superior and the matter was enquired into by the Manager of the appellant-company. After the ex=ination of the witnesses, one of the appellant's witnesses was recalled by the Manager to give any relevant information regarding
the respondent. The witness stated that the res~on
dent had been absenting himself without leave on . a number of occasions
and that a month back also he had behaved in an insolent manner thou,ih
no disciplinary act.ion was then , taken. At that stage, the
respondent
intervened and said that it was a case of misunderstanding due to his
habit Of talking in a loud voice. :rhe Manager did not ask the respondent
if he wanted to cross examine the
witness on his further
testimony
(though with respect to each witness earlier, he asked the respondent if
he wanted to cross examine), or whether. he had any explanation to Offer,
but passed an order finding the respondent guilty of the charge. In' the
order he expressly recorded that the respondent Ind beien guilty of abl!Onting himself without leave and that 'muc)l more than this he behaved
in an . insolent manner earlier' and that in those circumstances he was
not a person fit to be retained in service, The · Manall'J:r dismisoecl the
respondent. The dispute whether the appellant was justified in tehninating tlr: &ervices Gf five workmen including the ~spondent, was referred
to the Labour Court. During the pendency of the pfoceedings there was
a settlement of the disputes between the workers' Union and the manaae-
. ment with regard to all the employees. exc.ept the ~spondent, and the
Union withdrew .its support of the respondent.
The Labour Court, while accepting the finding of the domestic tribu-
.nal that the respondent was guilty of misconduct, set aside the order of
termination and ordered re'instatement on the ground that the respon-
·deht Wa!i not given an opportunity' to cross.ex.amine the witness or .. explain his testimony 'regarding the respondent';, past conduct.
Jn appeal to this Court, it was contended that (I) the respondent never
asked for the . opportunity and did not make a grievance of the denial of
the opportunity, (2) the Governm,ent, having refused to refer the dispute
on two previous occasions the reference. was in"t-alid as there was no
material to show why the Government did Ygo ultimately, (3) tpe Labour
Court had no jurisdiction to proceed with the matter after the Union
ceased to sponsor the respondent's case, and ( 4) it was not a fit case for
re-instatement in ·view of the long lapse of time between the date• ,of
dismissal and reference and that, if at Ill, . compensation 8hould have been
awarded in lieu or··re-instatement'.
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BINNY LTD. v. WORKMEN (Mitter, J.)
519
Dismissing the appea~
HELD : ( 1) (a) The record of the domestic tribunal demonstrates that
the respondent was not given a chance either to cross-examine the witness ·
or to explain the evidence, regarding his past conduct. The intervention
of the respondent could not be construed as his explanation or that it
amounted to an admission of the truth of the evidence. f,524 A-El
(b)Although the enquiry Officer found that the resp0ndent had behaved insolently_ towards his supelrior, he did not come to the conclusion
that h1& solitary act of indiscipline was sufficient to warrant
dismissal.
fhe language of the order shows that it was the cumulative effect of the
hpses in the past that resulted in the order. It was not a case where two
separate charges had been frame

## Text

518
BINNY LID.
v.
'IllEIR WORKMEN AND ANR.
February 17, 1972
(C. A. VAIDIALINGAM AND G. K. MITTER, Ji.]
Industrial Dwputes Act (14 of 1947), s. 10(1)-Dlsmlssal of. employee-Natural Justice--Opportμnit:y to cross examine witness lJ.Ot givenReference by Government, after refusal to· do so
earlier-Competence
lndustnal dispute-Jurisdiction to proceed after Union withdraws support
of workman-Re-instatement, when may be ordered.
The r .. pondent was alleged to· have behaved insolently towards .a
superior and the matter was enquired into by the Manager of the appellant-company. After the ex=ination of the witnesses, one of the appellant's witnesses was recalled by the Manager to give any relevant information regarding
the respondent. The witness stated that the res~on
dent had been absenting himself without leave on . a number of occasions
and that a month back also he had behaved in an insolent manner thou,ih
no disciplinary act.ion was then , taken. At that stage, the
respondent
intervened and said that it was a case of misunderstanding due to his
habit Of talking in a loud voice. :rhe Manager did not ask the respondent
if he wanted to cross examine the
witness on his further
testimony
(though with respect to each witness earlier, he asked the respondent if
he wanted to cross examine), or whether. he had any explanation to Offer,
but passed an order finding the respondent guilty of the charge. In' the
order he expressly recorded that the respondent Ind beien guilty of abl!Onting himself without leave and that 'muc)l more than this he behaved
in an . insolent manner earlier' and that in those circumstances he was
not a person fit to be retained in service, The · Manall'J:r dismisoecl the
respondent. The dispute whether the appellant was justified in tehninating tlr: &ervices Gf five workmen including the ~spondent, was referred
to the Labour Court. During the pendency of the pfoceedings there was
a settlement of the disputes between the workers' Union and the manaae-
. ment with regard to all the employees. exc.ept the ~spondent, and the
Union withdrew .its support of the respondent.
The Labour Court, while accepting the finding of the domestic tribu-
.nal that the respondent was guilty of misconduct, set aside the order of
termination and ordered re'instatement on the ground that the respon-
·deht Wa!i not given an opportunity' to cross.ex.amine the witness or .. explain his testimony 'regarding the respondent';, past conduct.
Jn appeal to this Court, it was contended that (I) the respondent never
asked for the . opportunity and did not make a grievance of the denial of
the opportunity, (2) the Governm,ent, having refused to refer the dispute
on two previous occasions the reference. was in"t-alid as there was no
material to show why the Government did Ygo ultimately, (3) tpe Labour
Court had no jurisdiction to proceed with the matter after the Union
ceased to sponsor the respondent's case, and ( 4) it was not a fit case for
re-instatement in ·view of the long lapse of time between the date• ,of
dismissal and reference and that, if at Ill, . compensation 8hould have been
awarded in lieu or··re-instatement'.
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BINNY LTD. v. WORKMEN (Mitter, J.)
519
Dismissing the appea~
HELD : ( 1) (a) The record of the domestic tribunal demonstrates that
the respondent was not given a chance either to cross-examine the witness ·
or to explain the evidence, regarding his past conduct. The intervention
of the respondent could not be construed as his explanation or that it
amounted to an admission of the truth of the evidence. f,524 A-El
(b)Although the enquiry Officer found that the resp0ndent had behaved insolently_ towards his supelrior, he did not come to the conclusion
that h1& solitary act of indiscipline was sufficient to warrant
dismissal.
fhe language of the order shows that it was the cumulative effect of the
hpses in the past that resulted in the order. It was not a case where two
separate charges had been framed against a delinquent and that they were
of such a serious nature that the finding of guilt on any one would warrant dismissal. [526 B-E]
'
Railway Board v. Niranjan Singh, [1969] 3 S.C.R • .548, India Marine
Service v. Their Workmen, [1963] 1 L.L.J. 122, Tata Oil Mills Co. v.
Its Workmen, [1963] 2 L.L.J. 78, referred to.
(2) (a) Under s. 10(1) of the Industrial Disputes Ac~ 1947, a refe•
rence may be made at any time when the· appropriare Government is
of opinion that any industrial dispute exists or is apprehended. From
the mere fact that on the previous occasions Government had taken the
view that no reference was called for, it did not follow that tho Government could not thereafter change its mind. [527 A-El
(bJ Further, the point could only be decided either in a proceeding
to which the Govern~nt was a party or when the cour1; was in possession
of all available material relating to the dispute. [527 E-F]
(c) It is not necessary that the order of reference must, on the face
of it, show what impelled the Gov~mment to depart from its earlier decision.
No., inference can be drawn against the Government from the
absence of·such marerial in the order. [~27 F-GJ
(3 i A dispute which h~d already b,een referred by Government does
not ceast to be one in respect of a portion of it, merely because the Union
did not choose to repre,.,nt the case of a particular dismissed employee.
If there was an industrial dispure at the time of reference it would not
cease to be one merely because the claims of some of the dismissed employees were settled by mutual agreement. (528 B-D]
( 4 )(a) Mere lapse of time is not enough to IO':ld the Labour Court
to hold that there should be no re-instarement.
The management must
show that any re-instatement will callse dislocation Of work. The Labour
Court would t!Jon have taken the circumstances into consideration before
passing its order.
But, in thC present c.ase, theTe were no ~uch ci.rcum·
stances. !529 A-CJ
Shalimar Works Ltd. v. Workmen, ,[1960] I S.C.R. ISO, 159, referred·
to.
(b) It is a settled principle that re-instatement should not bie ordered
when \he management justifiably alleges that they have ceaaed to have
confidence in the dismissed employee but there is no such allegation in
the present
caae.
Where
there
is
no
such allegation the Labour
520
SUPREME COURT REPORTS
[1972) 3 s:c:R.
Court must consider all the circumstances and decide whether justice and
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fair play require that re-instatement should be ordered. [529 D-Fl
Hindustan Steels v. A. K. Roy, [1970] 1 L.L.J. 228, referred to.
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1851 of
1967.
.
Appeal by special leave from the award dated October 9, 1967
of the Labour Court, Bangalore in Reference No. 86 of 1966.
0. f. Malhotra and D. N. Gupta, for the appellant.
M. Kuppuswamy, in person, for resJ?O!!dent No. 2.
The Judgment of the Court was delivered by
Mitter, J. Thjs is an appeal by special Ieiive from an award
of the Labour CoUrt, Bangalore dated October 9, 1967 where
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the dispute referred, for adjudication was, "whether the Management oi the Bangalm;e Woollen, Cotton ·and Silk Mills Ltd. (hereinafter referred to aS the 'Company') was justified in terminating
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the services of five workmen including one Kuppuswamy ?".
During the course of the proceedings the Binny Mills Labour
Association, Bengal, a registered trade union, sponsoring the cause
of the dismissed workmen entered into a settlement with the management whereby the management agreed to reinstate one RamaE.
nadha and gave up its demand for reinstatement of three others
excluding Kuppuswamy. The Union however withdrew its support
to Kuppuswamy from the date of the settlement and the latter stated
before the Labour Court that he would conduct his own case.
The facts relating to the dismissal of Kuppuswamy are as follows. He is alleged to have behaved in an insolent manner towards
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the Warehouse Master, his superior officer, on 3rd November, 1963
in respect whereof he was given a charge sheet on 6th November,
1963 the complaint against him being that he was guilty of misconduct falling under Standing Order No. 13 ( 11) i.e; act subversive to discipline.
He submitted a written explanation on 8th
November. An enquiry was held by the Mill Manager on 10th
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November and on the same day the. Mill Manager came to the
conclusion that the charge against Kuppuswamy had been proved
and taking into account the gravit;Y of the misconduct and his past
conduct the Mill Mabager found him not a fit person to . remain
in the employment of the company and terminated his services.
Before the Labour Court Kuppuswamy filed his statement of claim,
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the management its statement of objections followed by a rejoinder of Kuppuswamy. Kuppuswamy examined himself and one
Shadgopalan was eiramined on behalf of the management. The'
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BINNY LTD. _v. WORKMEN (Mitter, J.)
521
A records_of the domestic enquiry were marked illl evidence by common consent. The Lal;iour Court while accepting the finding of
the domestic tribunal that Kuppuswamy was guilty of the misconduct alleged against him was not inclined to retain the order of
termination of his service mainly on the ground that he was not
given an opportunity to challenge the statement of one VeeraragB havan regarding his past repord of service nor wa:s .he given any
opportunity to say whether Veeraraghavan's state!llent was true or
false or reasonably explainable. According to the Tribunal the
enquiry officer :
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"might have thought fit to pass. this very order of
termination, even without going into the past record of
Kuppuswamy.
But the possibility of his awarding a
lesser punishment also cannot be ruled out, altogether."
We have therefore to examine what happened at the enquiry
stage to ascertain whether the labour court was right in acting in
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~e manner it did. The charge against Kuppuswamy formula!¢
by the manager was that :
"on the 3rd of this month at about 9.15 a.m. Kuppuswamy had behaved in an insolent manner towards the
Ware.house Master, Mr. Veeraraghavan by shouting at
him and creating a disorderly scene in the Warehouse
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office."
The Manager reminded Kuppuswamy of his written explanation
and asked him whether he had anything to add. Kuppuswamy
stated that he had stocked a number of pieces which had mounted
so high that he apprehended that the same might fall over and
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he therefore started stocking the pieces in between the pieces
already mounted before_ the examiners.
The Manager reminded
him that the charge against him was not about stacking pieces but
of behaving in an insolent manner towards the Warehouse Manager. Kuppuswamy was asked whether he wanted to call anyone
as witness and Kuppuswamy answered in the negative. VeeraragG
havan was then examined by the Manager. According to Veeraraghavan's statement, Kuppuswamy had disregarded the instructions given to him by one Allam, Assistant Manager by stacking
the pieces between the examiners in a manner which would obstruct
the free passage for the examiners and that he did ~ deliberately.
Kμppuswamy when produced before the Warehouse Master by
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Allam is alleged to have flared up and shouted at him saying :
"You do not find out our difficulty.
You do not
listen to our grievances."
522
SUPREME COURT REPORTS
[1972] 3 S.C.R.
He is further alleged to have shouted ai the top of his voice :
"You think we are all slaves ? You do not know
how to treat us.
Are we not human beings ?"
It was also said that not only was Kuppuswamy was shouting
but he was also gesticulating with his hands towards the Warehouse master who found it impossible to.control Kuppuswamy and
immediately reported the matter to tlie Mill Manager.
Asked
whether he had any questions to put to V eeraraghavan, Kuppuswamy answered in the negative and explained that it was his habit
to speak in a loud voice. According to him Veeraraghavan did not
bear him any enmity. To the next witr1ess for the Management,
Allam, Kuppuswamy put only one question, namely, whether he
(Kuppuswamy) was not presenting his view of the case to the
warehouse master. He had no further questions to put to Allam
and stated that Allam did not bear him any enmity.
The third
witness was one Murty who supported the version given by
Veeraraghavan. To Murty also Kuppuswamy put only one question and denied that Murty bore him any enmity.
Aftler these
three witnesses were examined, the Manager called upon Veeraraghavan to give his remark.s about Kuppuswamy's conduct and ability
and any other relevant information in respect of the respondent
whereupon Veeraraghavan stated that Kuppuswamy had been
absent without leave or permission on a number of occasions and
that about a month back he had behaved in a manner similar to
the one with which he was charged but no disciplinary action had
been taken against him on the intercession of one Ra.iagopal. When
Veeraraghavan was making this statement, Kuppuswamy intervened and said :
"That was beca.use of a misunderstanding as it .is my
habit to speak in a loud voice."
The record of the proceedipgs shows that Veeraraghavan thereafter went out. The Manager did not ask Kuppuswamy on this
occasion as to whether he wanted to put any question to Veeraraghavan on the further testimony given by him or whether he had
any explanation to offer.
On the spot the Manager passed his
order wherein after reciting the facts of the case he recorded that
he found Kuppuswamy guilty of misconduct with which he was
charged on the testimony of three witnesses. A note was also made
that the misconduct was aggravated in view of the fact that the
insolent behaviour was unprovoked and there were no extenuating
circumstances in the case. The last two paragraphs of the order
read:
"The only question which remains for me is to decide what punishment should be given to you. While
looking into your service records, I find that you are
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Bll'!NY LTD. v. WORKMEN (Mitter, I.)
educated up to S.S.L.C.
Being an educated person a
better behaviour is expected of you. Further you he~rd
the Departmental Officer inform me during the course of
this enquiry that y0u had been warned b'y him for absence for 3 days without leave or permission and that
you had availed within a span of irbout 6 months, 25
days sick leave No. 9. Much more than all of these, he
had let you off only a month earlier for behaving insolently towards him purely because of reque&t of the
departmental workers' representative.
Under the circumstances, I do not consider that you are a
fit person to remain in the employ of the Company and
I therefore terminate your services with immediate effect
on payment of one month's wages and dearness allowance
in lieu of notice."
523
The question before us is, whether on the facts and circum~
stances of the case, the Labour Court was justified in exercising
its discretion in ordering reinstatement specially when he himself
had recorded in the course of his award that he accepted the finding tliat Kuppuswamy was guilty of the misconduct alleged against
him in the charge sheet
The points urged before us were as follows :-
(1) The Labour Court had gone wrong in setting aside the
order of dismissal on the ground which was not put forward by
the workman himself, specially because he never asked for an.
oppartunity to cross-examine V eeraraghavan on his last statement
and had never taken the point that he had been denied an opportunity to explain what was put forward against him by Veeraraghavan in his last statement before the enquiry officer. (2) The order
of reference was invalid inasmuch as , Government had on previous
occasions refused to refer the disputie for adjudication and there
were no material on record to show that persuaded the Government ultimately to do so. (3) The Labour Court should not have
proceeded with the reference after the Union had ceased to sponsor the case of Kuppuswamy and lefti him to.his fate.
(4) Reinstatement should not have been ordered in view of the long lapse
between the date of dismissal alild the order of reference; and ·(5)
The order of reinstatement was also not justified in this case inasmuch as the breach of discipline of which Kuppuswamy was found
guilty was of a serious character and the justice of the case required·
at the most that compensation should be .awarded tp him in place
of reinstatement.
In our view none of the contentions have any merit. As re-·
gards the first point, the record made by the enquiry officer amply
524
SUPREME COURT REPORTS
{1972] 3 S.C.R.
demonstrates that Kuppuswamy was not given a chance to crossexamine V eeraraghavan on his further.statement nor was he asked
to state'anything by•way of exp!anation. To our mind the record.
of the enquiry officer seems to suggest that he was under the impre,sion that he could look into the past record of the delinquent
without affording him an opportunity of explanation or testing by
cross-examination what was alleged against him. On each occasion when a person was examined on behalf of the management,
the Manager was at pains to ask the delinquent whether he wanted
to put any questions. But when the evidence was given about his
absenting himself without leave or permission and specially when
he was accused of a similar insolent conduct in the past, the least
he could have done was. to have asked Kuppuswamy whether he
had any question to put on the further evidence given and whether
he had anything to say for himself in respect of what was alleged.
We were asked to record Kuppuswamy's intervention "tha~ it was
his habit to speak in the loud voi~" as and by way of his explanation and also an10unting to an admission of the truth of the
statement of Veeraraghavan. We find ourselves unable to accept
his view. It appears clear to us that the enquiry officer was alive
to the fact that the delinquent had to be given an opportunity of
cross-examining a witness on his statement and that it was necessary also for him to find out whether the delinquent was accusing
the witness of any bias or pre-conceived notion.
Several decisions were cited to us in support of the proposition put forward by 0unsel that it was for the delinquent to
raise an objection when he found a point being made .against him
without an opportunity to him to give evidence by way of explanation. In our view each case must depend on its own facts
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and the circumstances of a par!icular case may show that no prejudice had been caused to the delinquent by any irregularity sought
to be availed of by him.
In The Management of Delhi Cloth &
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General Mills Co. Ltd. v. Kalu Ram(I) this Court took the view
that the Tribunal whose order was appealed against had gone
wrong in taking the view that the enquiry officer had conducted
the enquiry unfairly in that the respondent was not given an opportunity to cross-examine the expert of the appellant with the
help of an expert of his own.
In that case the respondent had
been charged with using abusive,
defamatory and threatening
language in a letter to the officer in charge of his department without putting his name or signature thereto.
In the domestic enquiry the expert produced by the respondent was allowed to be
cross-examined by the expert previously examined on behalf of
the management but the expert produced on behalf of the appellant was only cross-examined
b:i: the respondent himself.
This
Cour~ noted tha\ the Tribunal had not found that the respondent
(I) Civil Appeal No. 195of1964decided on 9th April, 1965.
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BINNY LTD. v. WORKMEN (Mitter, I.)
525
ever demanded that he should be permitted to cross-examine the
expert produced on behalf of the appellant with the help of an
expert of his own and there had been no refusal of any such
request.
According to this Court :
"If the respondent did not ask for an opportunity to
cross-examine the appellant's expert with the help of an
expert because he-had no legdl advice, that default on his
part cann.ot mean that the enquiry officer violated the
principles of natural .justice.
Nor the fact that crossexamination by the respondent could not be of the same
quality as the cross-examination with the aid of an
expert meari that the enquiry officer was guilty of
breach of any of the principles of natural justice."
We fail to see how this case helps the appellant before us at all.
It was argued _gn behalf of the appellant that once the Labour
Court accepts the finding of the domestic tribunal that the delinquent is guilty of the misconduct alleged against him the fact that
D the order of termination of service mentions a similar conduct
in the past on which no charge had been raised' should not make
any difference to the result. Our attention was drawn to the
decision of this Court in Railway Board v. Nlranjan Singh(')
where the enquiry committee after investigating the charges had
· come to the conclusion that although the first charge was not
E proved ~yond all reasonable doubt the respondent was guilty of the
second charge. The Disciplinary authority, the General Manager,
accepted not only the findings of the second charge, but differing
from the conclusion on the first charge tentatively took the view
that the respondent was guilty of that charge as well and after
the issue of a show cause notice and the rejection of his explanaF tion directed that the respondent be removed from service. The
High Court set aside. the order of dismissal on a writ petition under
Art. 226 taking the view that.
"where an order such as an order of detention or
removal from service is based on a number of grounds,
and one or more of these grounds disappear it becomes
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difficult to uphold the order when it is not. clear to what
extent it was based on the ground found to be bad."
It was urged that the Court should not have assumed that the
Genera! Manager would have inflicted the punishment of dismissal solely on the basis of the second charge and consequently the
punishment should not be sustained if it was held that one of the
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two charges on the bllSiS of which it was imposed was unsustainable. This was rejected following the decision in State of Orissa
-(!) [1969] 3 S.C.R. 548.
526
SUPREME COURT REPORTS
(1972] 3 s.C.R
v. Bidyabhan Mahapatra(') where it was said that if an order A
in an enquiry under Art. 311 can be supported on any finding
as substantial misdemeanour for which punishment imposed can
lawfully be given, it is not for the Court to oonsider whether that
ground alone would have weighed with the authority in imposing
the punishment in question. In our view that principle can have
no application to the facts of this case.
Although the enquiry
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officer found in fact that the respondent had behaved insolently
towards the Warehouse Master, he did not come to the conclusion that this act of indiscipline on a solitary occasion W3S sufficient to warrant an order of dismissal.
He expressly recorded
that the delinquent had been guilty of absenting himself without
leave, that he had taken 25 days'sick leave in a span of six months
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and that "much more than all this, he (the warehouse master) had
let Kuppuswamy off only a month earlier for behaviour insolently
towards him purely because of request of the departmental workers' representative" and it is in these
circumstances that the
Manager did not consider the delinquent to be a person fit to be
retained in service.
'J]:le language of the order leaves no dou)>t
in our mind that it was the cumulative effect of the lapses on the
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part of the respondent_ that had resulted in the order of termination of service.
It was not a case where two separate chargoes
had been framed against the delinquent and they were of such
a. serious nature that the finding of guilt on any one would warrant the dismissal of the delinquent.from service.
In our view the decision in India Marine Service v. Their E
Workmen(') does not help the appellant.
There the order of
enquiry officer extracted at page 124 right hand column clearly
shows that the order of dismissal was based on one of the charges
and it was only after recording this decision that the enquiiy officer
went on to note "in taking the action against you ~e have also
taken into consideration your past record which is very much F
against you."
The case of Tata Oil Mills Co. v. Its Workmen(') is equally
unhelpful to the appellant. There this Court found itself unab!e
to sustah1 the finding of the Industrial Tribunal that the domestic
enquiry was unfair because. tl1e concerned workman had not been
given sufficient time to submit his explanation.
R'l:amining the
facts of the case this Court concluded that "the position appears
to be that on the two points on which Gupta could have crossexamined Mr. Banerjee if the report had been given to him have
been tested in cross.examination, and so we feel· no hesitation in
holding that the failure to supply Mr. Banerjee's report to Gupta
has not caused any prejudice to Gupta in ihe present case."
(I) [1962] Supp, I. S.C.R. 648.
(2) [196311L.L.1.122.
(3) [1963]2 L.L.1. 78
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BINNY LTD. v. WORKMEN (Mitter, I.)·
527
The submission that the order of reference js invalid as the
Government had no grounds or ma11erial to form the opinion
about the existence of a dispute in order to enable it to make an·
order under s. 10(1) is one which does no~ merit any consideration. ·In the absence of the Government from the array of the
parties it is not; possibfo to come to any finding as to whether
there were any such material or not. But the mere facU that on
two previous occasions Government had taken the view that no
reference was called for does not entitle us to conclude that there
could be no cause for reference in 1966. The enquiry was held
on 10th November 1963 and the order. of termination of service
was made the very same day. The letter of the Under Secretary
to Government._ I.:abqur Department
dated August 17, 1964
shows that out of the five workmen in question Government considered the cases of dismissal of three as quite old as having taken
place at different times in 1961, 1962 and 1963 and as such did
not deserve consideration. With regard to the other two, namely,
Ramanatha and Kuppuswamy Government was of the view that
they had been employed in the year 1963 ivself and had put in
very short periods of service and as they had been dismissed -after
proper enquiry no reference was called for.
The second loiter
is dated August 21, 1965 where the Under Secretary merely stated
that in view of the decision already taken, the dispu11e in question
did not merit reference for adjudication. From the above it does
not follow that Govenμnent could not thereafter either change its
mind or make an order of reference on (resh material before it.
Under s. 10(1) of the Industrial Dispu11es Act a reference may
be made at any time whenever the appropriate Government is of
opinion that any industrial dispute exists or is apprehended. At
any rate the point could only be canvassed either ;n a proceeding
to ':Vhich the Government was a party or in one where tlhe Court
v'"- in possession of all the available material relating to the dispute. In the absence of such material the point must be decide4
against the appellant.
In our view 1lhe further submission· that
the order of reference must on the face of it show what impelled
the Government to depart from its earlier decision and that
in the absence thereof the Court must hold that there were no
reasons for such a change of opinion is without any force.
The next submission was that the dispute with regard to the
dismissal of Kuppuswamy ceased to be an industrial dispute after
·the Union ceased to sponsor his case.
As already mentioned,
during the pendency of the proceedings before the Labour Court,
there was a settlement of the disputes between the Union and the
Management with ree;ard. _to all !he employees other than Ku1>-
puswamy.
The memorandum of settlement under section 12(3)
of the Industrial Disputes Act whkh was put in on the 24th June
1967 shows that the Union had ·proposed ·that in consideration
of their withdrawal of the cases of Madaiah, Ekambaram and
528
SUPREME COURT REPORTS
[1972] 3 S.C.R.
Devaiah, Ramanatha and Kuppuswamy may be taken back into A
service but the Management did not accept the proposal but offered
to take back Ramanatha only, which was accepted by the Union.
The Union further unqertook no~ to represe,tit Kuppuswamy's
case or prosecute it before the Labour Court in view of this overall settlement with the Management. It is not necessary for us
to consider whether s. 2A of the Act which was introduced in
B
the statute in 1965 has any application to the facts before us.
We do not however see any reason
to hold that the dispute
which had already been referred by Government should cease
to be one in respect of a portion of it merely because the Union
did not choose to represent the case of a particular dismissed
employee. If there was an industrial dispute at the time of reC
ferences it would not ce'!CSe to be one merely because the claim of
some of the dismissed employees
was
settled
by mutual
agreement.
The las~ point urged before us was that on the facts of the
case the Labour Court should not have directed reinstatement
but should have allowed compensation to Kuppuswamy in view
D
of the following factors.-(!) Kuppuswamy had been dismissed
because of gross indiscipline and it was not proper to order re,_
instatement of a person who 1night indulge in similar acts in the
future.
( 2) Reinstatement should not have been ordered four
years after the dismissal as the Management had already made
other arrangements for the work which was formerly being done
E
by Kuppuswamy executed through some other workman.
On
the first of the above points our attention was drawn to the decision in Shalimar Works Limited v. Their Workmen(').
There
the facts were that the company had discharged a large number
of workmen in April 1948 and the first order of reference was
made in October J 952. The case of no less than 250 workmen
was involved in the dispute and this Court observed that :
F
" .... if for any reason there had been a wholesale
discharge of workmen and closure of the industry followed by its reopening and fresh recruitment of labour,
it is necessary that a dispute regarding reinstatement of
a large number of workmen should be referred for adjudication within a reasonable time. . . .
G
In these circumstances, we are of opinion that the
tribunal would be justified in refusing the relief of reinstatement to avoid dislocation of the industry. . "
On this view the Court felt that the Appellate Tribunal should
not have ordered the reinstatement of even the 15 workmen as
H
their case was exactly the same as that of a large number of
, (I) [1960] I S.C.R. ISO, 159.
A
B
c
BINNY LTD. v. WORKMEN (Mitter, I.)
529
others.
In our view what was said in the Shalimar W arks' case
cannot be repeated in the case before us.
The appellant pursues an industry with_ a large number· of workmen and we cannot imagine any serious dislocation of work by the order of reinstatement of one workman. Normally it will be months before
ari order of reference is made by .Government and one or two
years elapse in almost all C3$f'S before the adjudication by an
Industrial Tribunal is complete. If mere lapse of time be enough
to lead the Industrial Tribunal to hold that there should be no
reinstatement of service the power of reinstatement will become
obsolete.
In any case the Management must try to show thae
reinstatement will cause dislocation of work and the Tribunal
must take that into consideratiion. In this· case we find no such
compelling circumstances.
On the question as to whether compensation should have been
awarded in lieu of reinstatement, we were referred to the case of
Hindustan Steels v. A. K. Roy(') where it was said that it was
in the discretion of the tribunal to make an order of reinstatement ·
D · or to award compensation in · lieu thereof and it is only when
the tribunal exercises its jurisdiction in disregard of the circum~
stances or the relevant principles laid down iin regard thereto that
this Court would interfere with their discretion.
It has become
almost a sett;ted principJe that reinstatement should be awarded
where the management justifiably alleges that tJiey have ceased to
E
r
have confidence in the dismissed employee.
In other cases the
Tribunal must consider carefully the circumstances of the case to
come to a finding that justice and fairplay require that reinstatement should be awarded.
In this case, there is no allegation
that the Management )!ad lost confidence in Kuppuswamy. It is
extremely doubtfu] whether the Manager would have ordered
dismissal if Veeraraghavan had not drawn his attention to the
past lapses of the respondent about which he was not allowed
to have a say.
We do not therefore feel that we must interfere
with the award of reinstatement of the respondent.
In the result the appeal fails and is dismissed with costs.
V.P.S.
Appeal dismissed.
(I) [1970] I L.L.J. 228.