# MANAGEMENT OF CHURAKULAM TEA ESTATE (P) LTD v. THE WORKMEN & ANR

- **Citation:** [1969] 1 S.C.R. 931
- **Court:** Supreme Court of India
- **Decided:** 1968-09-03
- **Bench:** J. M. Shelat, V. Bhargaya, C. A. Vaidialingam
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/management-of-churakulam-tea-estate-p-ltd-v-the-workmen-anr-4541
- **Pages:** 12

## Headnote

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Industrial Dispute-Bonus paid for past number of years, neither at
a uniform rate nor connected with any festival-Clai111 as
implied condition of service-Whether sustainable--Strike
protesting
against
the
management's boycotting conference,
whether
justified-Lay
off
b,v
management consequent to strike, whether ju~tified.
FQr the past number of years the appellant management, had paid
bonus to its workmen-respondents at different rates.
In respect of the
years 1957, 1958 and 1959, !'here was a setl!ement between the managements of various similar industries. and their workmen relating to pay~
ment of bonus, and in this settlement it was stated that it would not apply
to the appellant's industry, The appellant declined to pay any bonus for
these three years,
The respondents-workmen claimed bonus for these
years on the basis that the payment had become traditional and cusl-Omari•.
or~ at any rate, it had become an implied
condition of service : it was
not· claimed as profit bonus, production bonus or bonus connected with
any festival.
The conciliation proceedings relating to the claim of bonus
failed.
The Labour Minister called for a conference of the representotives of the management and the workmen.
The representatives of the
\Vorkmen attended the conference but the management boycotted it. Ihe
factory work.men went on strike for half a day, and on this very day the
management put up a notice that since the factory workers had gone on
strike without previous notice they were forced to lay-cff without compensatiO:n all the workmen in the enti're establishment. The Government .
referred the disputes for adjudication by Tribunal. The Industrial Tribunal held that (i) the workmen were entitled to bonUs as it had become an
implied condition of rervice, (ii) the strike by facl-Ory workers was both
legal and justified and directed payment of wages for that day; and (iii)
the lay-Off by the management was without just cause and was done as
a retaliatory measure. and directed payment of w31l"s also for thio period,
In appeal, this Court,
HELD : ( i) The claim for bonus could not be sustained .even as a
customary or traditional bonus, because. apart from the fact that it w2s
not connected with any festival, one of the essential ingredients, viz., that
the payment should have been at a uniform
rate
throughout, was also
ndmittedly lacking in the case. An implied condition of service could not
be inferred, where payment had not been uniform in the past, unless such
payment could be connected with some festivaL [939 C-E]
lspahani Ltd, Calcutta v. /spahani Employus' Union, [1960] I S,CR
24, distingu;,shed,
Mahalax1ni Cotton Mills Ltd. Calcutta v. Mahalaxmi Cotton
Mills
Workers' Union [1952] LkC. 370, The Graham Trading Co. (India) Ltd,
v. Its Workmen, [1960] I S.C.R 107. Management of Bombay Co. Ltd, v,
Workmen, [1964] 7 S,CR. 477, Bombay Company (Private) Ltd. v. Their
Eftlployees, C.A. No. 659 df 1966 dt. 22-9-1967 and Jardine Henderson
Ltd, v. The Workmen & Anr. [1962] Supp. 3 S,C,R. 582, referred to.
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932
SUPREME COURT RF.PORTS
(1969) I S C.R
(ii) The s•rikc by the factory workers could not be considered to be· A
illegal.
There were no concilialion proceedings pending before a Board
of Conciliation on the day on which the factory workers went on strike
and hence the strike did not come under s. 23 (a) of the Industrial Disputes Act, 1947.
Further there was nothing in the evidence adduced by
the management to sho\v that the strike was not for the reason given
by the workmen ''iz., to protest against 1hc attitude of the man:1gcmcnt
in boycotting the conference called by Labour Minister. [94 t BJ
Mana1:en1e11r of Clia11dramalai l:,".r/<llc, f7rnakula1n
v.
Its
Workn1en
[ t 960] 3 S.C.R. 451. referred to.
(iii) There was no force in the management's contention that as there
\Vas a strike in the factory section, work in the other section could not be
carried on and, as the management were not sure whether the workmen y,.·o

## Text

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MANAGEMENT OF CHURAKULAM TEA ESTATE (P) LTD.
v.
THE WORKMEN & ANR.
September 3, 1968
B
(J. M. SHELAT, V. BHARGAYA AND, C. A. VAIDIALINGAM, JJ.]
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Industrial Dispute-Bonus paid for past number of years, neither at
a uniform rate nor connected with any festival-Clai111 as
implied condition of service-Whether sustainable--Strike
protesting
against
the
management's boycotting conference,
whether
justified-Lay
off
b,v
management consequent to strike, whether ju~tified.
FQr the past number of years the appellant management, had paid
bonus to its workmen-respondents at different rates.
In respect of the
years 1957, 1958 and 1959, !'here was a setl!ement between the managements of various similar industries. and their workmen relating to pay~
ment of bonus, and in this settlement it was stated that it would not apply
to the appellant's industry, The appellant declined to pay any bonus for
these three years,
The respondents-workmen claimed bonus for these
years on the basis that the payment had become traditional and cusl-Omari•.
or~ at any rate, it had become an implied
condition of service : it was
not· claimed as profit bonus, production bonus or bonus connected with
any festival.
The conciliation proceedings relating to the claim of bonus
failed.
The Labour Minister called for a conference of the representotives of the management and the workmen.
The representatives of the
\Vorkmen attended the conference but the management boycotted it. Ihe
factory work.men went on strike for half a day, and on this very day the
management put up a notice that since the factory workers had gone on
strike without previous notice they were forced to lay-cff without compensatiO:n all the workmen in the enti're establishment. The Government .
referred the disputes for adjudication by Tribunal. The Industrial Tribunal held that (i) the workmen were entitled to bonUs as it had become an
implied condition of rervice, (ii) the strike by facl-Ory workers was both
legal and justified and directed payment of wages for that day; and (iii)
the lay-Off by the management was without just cause and was done as
a retaliatory measure. and directed payment of w31l"s also for thio period,
In appeal, this Court,
HELD : ( i) The claim for bonus could not be sustained .even as a
customary or traditional bonus, because. apart from the fact that it w2s
not connected with any festival, one of the essential ingredients, viz., that
the payment should have been at a uniform
rate
throughout, was also
ndmittedly lacking in the case. An implied condition of service could not
be inferred, where payment had not been uniform in the past, unless such
payment could be connected with some festivaL [939 C-E]
lspahani Ltd, Calcutta v. /spahani Employus' Union, [1960] I S,CR
24, distingu;,shed,
Mahalax1ni Cotton Mills Ltd. Calcutta v. Mahalaxmi Cotton
Mills
Workers' Union [1952] LkC. 370, The Graham Trading Co. (India) Ltd,
v. Its Workmen, [1960] I S.C.R 107. Management of Bombay Co. Ltd, v,
Workmen, [1964] 7 S,CR. 477, Bombay Company (Private) Ltd. v. Their
Eftlployees, C.A. No. 659 df 1966 dt. 22-9-1967 and Jardine Henderson
Ltd, v. The Workmen & Anr. [1962] Supp. 3 S,C,R. 582, referred to.
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932
SUPREME COURT RF.PORTS
(1969) I S C.R
(ii) The s•rikc by the factory workers could not be considered to be· A
illegal.
There were no concilialion proceedings pending before a Board
of Conciliation on the day on which the factory workers went on strike
and hence the strike did not come under s. 23 (a) of the Industrial Disputes Act, 1947.
Further there was nothing in the evidence adduced by
the management to sho\v that the strike was not for the reason given
by the workmen ''iz., to protest against 1hc attitude of the man:1gcmcnt
in boycotting the conference called by Labour Minister. [94 t BJ
Mana1:en1e11r of Clia11dramalai l:,".r/<llc, f7rnakula1n
v.
Its
Workn1en
[ t 960] 3 S.C.R. 451. referred to.
(iii) There was no force in the management's contention that as there
\Vas a strike in the factory section, work in the other section could not be
carried on and, as the management were not sure whether the workmen y,.·ould tum up for \lo·ork, Jay-off, in the circumsranccs, wa<; justified.
The entire body of \lo'ork.men present·cd for work on the next day of the
strike by the factory \Yorkers, hut they were declined work by the management on the ground of lay-off. and the lay-oil v.·as as a
retaliatory or
vindictive measure against the factory workers.
[941 GJ
C1v1L APPP.LLATE JURISDICTION : Civil Appeal No. 552 of
I 966.
Appeal by special leave from the Award dated September 21,
I 964 of the Industrial Tribunal, Alleppcy in fndustrial Dispute
No. JO of 1962.
JI. R. Gokhalc, S. S. Javali and 0. C. Mathur, for the appellant.
H. K. Puri, for respondent No. I.
The Judgment of the Court was delivered by
Vaidialingam, J. In this appeal. by special leave. Mr. H. R.
Gokhale, learned counsel for the management-appellant, challenges the award, dated September 21, 1964, of the Industrial
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Tribunal. Allcppey. in l.D. No. 10 of 1962.
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We may briefly refer to the circumstances, leading up to the
passing of the award in
question.
The appellant owns
the
Churakulam Tea Estate, in Kottayam, Kerala State. From 1946
onwards, the Planters' Association of Kerala (South India) used
to enter into agreements. with the representatives of the workmen,
from time to time, for the payment of bonus. The first
agreement. in 1946. related to the payment of bonus
for the years
1947, 1948 and 1949; and. by Exhibit W-5. the said
agreement
was extended for the years 1950 and 1951. A fresh agreement.
Exhibit W-15. was entered into in 1955, for payment of bonus for
the years 1952, 1953 and 1954 ar.d there appear to have been
subsequent agreements also.
There is no controversy that
the
appellant paid bonus for nine years, i.e., from 194 7 to 1951 an~
1953 to 1956. There is also no controversy that the payment of
bonus, for these years, was not at a uniform rate. For instances.
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CHURAKULAM TEA ESTATE V. WORKMEN (Vaidialingam, J.)933 •
from 1946 to 1949 bonus was paid at 4% of the total earnings
whereas, for the year 1950, it was increased to 8t% of the total
earnings.
From that year onwards an initial payment of
4%
was fixed, leaving the balance to be determined by industcy-wise
agreements.
Again, in 1955 and 1956, the initial payment was
raised to 6~ % of the total earnings. So far as the year 19 5 2 was
concerned, the appellant's case was that it had not paid any
bonus, as such, but, on the other hand, it had made an ex-gratia
payment of Rs. 3 to each worker; but the Tribunal has not
accepted this plea and it has held that the said payment must be
treated as one having been made towards bonus. According to
the appellant, it paid bonus for the years, mentioned above, because it was earning pr6fits.
For the years 1960 and 1961 also, the appellant paid bonus
to its workers in accordance with the industry-wise agreements.
In respect of the years 1957, 1958 and 1959, there was a memorandum of settlement, Exhibit M-4, dated January 25,
1960,
between the managements of the various plantations and their
workers, relating to payment of bonus. So far as tea estates are
concerned, the agreement provides for payment of bonus, at a
particular percentage of the annual total earnings of a worker,
for the three years in question, depending upon the total extent
of the estates concerned. There is no controversy that, under
cl. 7 of this agreement, it was provided that the agreement will
not apply to the appellant's estate. Therefore, so far as the payment of bonus for these three years is concerned, the appellant
was not a party to any agreement.
The appellant, on the ground that it had not earned any profit
during these years and, on the further ground that it was not
bound by the agreemenf, Exhibit M-4, declined to pay any bonus
for these three years.
The workmen started an agitation claiming bonus at the rates mentioned in Exhibit M-4, and conciliation
proceeding~ in that regard failed.
Twenty-seven workers, in the
factory of the appellant, struck work on the afternoon of November 30, 1961. The management declined to pay wages, for that
day, to these factory workers.
The management also laid off,
without compensation, all the workmen of the estate, from December 1, 1961 to December 8, 1961.
·
The State Government, by its order dated May 24, 1962,
referred three questions, for adjudication, to the Industrial Tribunal, Alleppey :
"l. Bonus for the years 1957, 1958 and 1959.
2. Wages for days of lay off from 1-12-1961.
3. Wages for 30-11-1961 for factory workers."
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Before the Tribunal, both the management and the workmen
were agreed that the bonus, which was the subject of adjudica-
!Sup. CI/69-13
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SUPREME COURT REPORTS
ll969} I S.C.R.
tion was not to be on the ba,is of available surplus and the said
aspect need not be considered by the Tribunal. The respandents
also accepted that the bonus claim, made by them, was not for
profit bonus, production bonus or bonus connected with any festival or celebration. On the other hand, the specific claim, for
payment of bonus, by the workmen, was on the basis that the said
payment had become traditional and customary; or, at any rate,
it had become an implied condition of service.
So far as
the
strike, on November 30, 1961, was concerned, according to the
workmen the strike was legal and justified and that the factory
workers were entitled to wages, for that day. It was the further
case of the workmen that the lay-off, from December I, 1961 to
December 8, 1961, was illegal and it disclosed a vindictive attitude. on the part of the manag.~ment, and that the workmen were
entitled to wages for that period also.
The management resisted the claim of the workmen, in respect of ,i11 the three matters.
Regarding the claim for honus, it
pleaded that it was not a party to the agreement, Exhibit M-4.
The management contended that the payment of bonu; had not
become either traditionai, or customary, in the plantation industry, nor was it an implied condition of service. It also urged that
inasmuch as the claim for bonus, in this case, was not connected
with any festival and, as previous payments had not also been at
a uniform rate, the gue;tion of payment of bonus having become
either a· customary payment, or payment by virtue of an implied
condition of service. was not sustainable in law.
According to
the management. the strike, on November 30, 1961, was
both
illegal and unjustified and hence the factory workers, who went
on strike, were not entitled to wages.
The management alsc
pleaded that the lay-off, from December I to December 8. 1961.
was perfectly justified, in view of the conduct of the workmen of
the estate.
After referring to the fact of payment of bonus, by the plantation industry, from 1946 and onw~rJs, though not at a uniform
rate the Industrial Tribunal held that payment of bonus could
bl" con<idcrcd to have become an implied condition of service.
The Tnounal, inasmuch as it was admitted that the claim tor
bonus had nothing to do v.ith any festival, held that the question
of its being a customary or traditional bonus. in the strict sense
of the word, did not arise for consideration. In consequence. the
Tribunal only considered the alternative basis of the claim, i·i~ ..
that the payment of bonus had become an implied condition of
service.
Jn this connection, the Tribunal referred to the dzcision, o•
this Court, in lspahani Ltd., Calcutta
v.
lspahani Employees'
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CHURAKULAM TEA ESTATE V. WORKMEN (Vaidialingam, !.) 935
Union(') and held that a term for paying bonus may b~ implied, even though the payment may not have be~n. at a umform
rate throughout; and, under such circumstances, 1t 1s open to the
Tribunal itself to consider what should be the quantum of payment in a particular year. The Tribunal held. that the tests laid
down in lspahani's case(') about payment bemg unbroken .and
having been made for a sufficiently long period, under circumstances excluding the payment being made out of bounty or as
ex gratia, were all satisfied, in the instant case. Having c?me. to
the conclusion that the payment of bonus had become an m1phed
condition of service, for the purpose of fixing the quautum tllat
should be awarded, the Tribunal referred to
the
agreement,
Exhibit M-4. While conscious of the fact that tlle appellant was
specifically excluded from the operation of this agreement,
the
Tribunal was of the view that the percentage of bonus, fixed
under Exhibit M-4 for tea industry, could be safely adopted. On
this basis, the Tribunal awarded to the workmen, bonus at six-andtwo-thirds per cent of the total earnings of the workmen, for each
of the three years 1957, 1958 and 1959.
The Tribunal was also of the view that the strike of the factory workers, on November 30, 1961, was both legal and justified and hence directed the appellant to pay wages for that day.
The Tribunal further held that the lay-off, of the workmen, by
the management, for eight days from December 1, 1961, was
without just cause and it was done as a retaliatory measure. It
made the management liable for payment of wages to the work-·
men for this period.
We shall first take up the question about the legality of the
award of bonus. Mr. Gokhale urged that the claim of the workmen was on the basis that payment of bonus had become an
implied term of the conditions of service. Admittedly, the claim
for bonus is not related to or connected with any festival. Even
according to the workmen, and as found by the Tribunal, the
payment over the years had not been at a uniform rate.
There
can be no claim for payment of bonus, under such circumstances,
as an implied condition of service, unconnected with anv festival;
and the claim cannot also be recognised, either on the , basis of
customary or traditional payment, in view of the fact that one of
the essential ingredients, for sustaining such a claim, viz., payment at a uniform rate, is absent in this
case.
Counsel also
urged that the Tribunal, when it held that in order to recognize a
claim for bonus as an implied condition of service, the payment
need not have been at a uniform rate, has
misunderstood
the
observations of this Court, in .fshphani's Case('). which was a
case of a claim for bonus relaiing to a festival. Mr. Puri, the
'!earned counsel for the respondent, in view of the decisions of
(!) (1960] 1S.C.R.24.
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SCPRDIE COL'R r REPORTS
. [1969] I SC.R.
this Court, to which we will presently refer, quite naturally found
great difficulty in supporting the Tribunal regarding its award of
bonus.
In lspa/ia11i's case\') this Court had to cllnsider a claim for
Puja bonus, in Bengal, and the essential ingredients, for sustaining Such a claim when it i> based on an implied agreement. After
stating that the claim. for Puja Bonus, can be based, either as a
matter of implied agreement between the employers
and
employees, creating a tenn of employment for payment of Puja
bonus, or that even where no implied agreement can be inferred,
it may be payable as a customary bonus, this Court, in the said
decision, specifically dealt with a claim, for payment of bonus, as
an implied condition of service.
This Court further accepted. as
correct. the tests. laid down by the Appellate Tribunal, in Maha-
/axmi Cot1011 Mills l.td .. Calc1111a v. Malialaxmi Cotton
Mills
Wori.t'rs' U11in11(') for in.fcrring that there is an implied agreement. for grant of such bonus.
The three
circumstances,
laid
down by the Appellate Tribunal, were : ( 1 ! that
the payment
must be unbroken; (2) that it must be
for a
sufficiently
long
period: and ( 3) that the circumstances, in which payment
wa<
made. should be such as to exclude that it was paid out of bounty.
The Appellate Tribunal had also held that even if payment was
not at a uniform rate throughout the period, an implied agreement to pay smnething could be inferred, and it would be for the
Tribunal to decide what was the reasonable amount to be paid
as Puja bonus.
All these principles were
approved,
by this
Court in Jspa/iani's case( 1 ).
Pausing here, it must be noted that lhc payment, al a uniform rate. wa.s not found necessary for establishing a claim for
payment of bonus, as an implied condition of service,
as tha1
claim was held to relate to a
festival.
This aspect
has
been
missed by the Tribunal in the award under consideration. and it
lrns proceeded on the basis that this Court has laid down
that,
notwithstanding that a payment is not at a uniform rate. ;1evertheless, a claim based on an implied condition of service, can be
recognised, provided the other tests are satisfied.
This Court, again had to consider the essential
ingredients.
to be established. whe~ payment of bonus, as customary or traditional, is claim!.!d-again related to a festival-in The
Graham
Trading Co. (lndia) Ltd. v. It" Workmen(") and dealt with the
question, as follows :
"In dealing with puja bonus based on an implied
term of employment, it was .pointed out by
us in
Messrs. lspalwni I.td. v. fspalzani Employees' Union(')
(ll [196011 S.C.R. 24.
m
< 19521 LAC. J70.
()) [1960) 1 S.C.R. !07, 111.
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CHURAKULAM TEA ESTATE V. WORKMEN (Vaidialingam, !.) 937
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that a term may be implied, even though the payment
may not have been at a uniform rate throughout. and
the Industrial Tribunal would be justified in deciding
what should be the quantum of payment in a particular year taking into account the varying payments made
in previous years. But when the question of customary
and traditional bonus arises for adjudication, the considerations may be somewhat different. In such a case,
the Tiibunal will have to consider; (i) whether the payment has been over an unbroken series of years; (ii)
whether it has been for a sufficiently long period,
though the length of the period might depend on the
circumstances of each case; even so the period may normally have to be longer to justify an inference of traditional and customary puja bonus than may be the case
with puja bonus based on an implied term of employment; (iii) the circumstance that the payment depended
upon the earning of profits would have to be excluded
and therefore it must be shown that payment was made
in years of loss.
In dealing with the question of custom, th.e fact that the payment was called ex gratia by
the employer when it was inade, would, however, make
no difference in this regard because the proof of custom
depends upon the effect of the relevant factors enumerated by us; and it would not be materially affected by
unilateral declarations of one party when the said declarations are inconsistent with the course of conduct
adopted by it; and (iv) the payment must have been at
a uniform rate throughout to justify . an inference that
the payment at such and such rate had become customary and traditional in the particular concern. It will be
seen that these tests are in substance more stringent
than the tests applied for proof of puja bonus as an implied term of employment."
It will be seen from the above extract that an additional circumstance has also been insisted upon, in the case of customary or
traditional bonus, .that the payment must have been at a unifonn
rate throughout to justify an inference that the payment at such
and such a rate had become customary and tradi_tional in
the
particular concern. Therefore, even if the claim, in the case before us. is considered as a customary or tradition&! bonus, this
test will have to be satisfied and, as mentioned earlier, it is lacking in this case.
I
These two decisions were again adverted to by this Court in
Mana1<ement of Bombay Co. ltd v. Workmen(')
This Indus-
"trial Tribunal, whose award was under consideration,
by this
---·
(1)
[1964] 7 S.C.R. 477.
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938
SGPREME COURT REPORTS
[ 1969] I S.C.R.
Court, in the said decision, had held that payment of bonus, as
A
an implied condition of service, need not be attached to any festival.
This Court did not accept that proposition as correct. After
referring to the decision in /spahani's case( 1 )
this
Court
observed, at p, 479 :
";\ow where the payment is connected with a festival it is possible to infer that there is an implied condition to pay something at the time of the
festival, even
though the evidence discloses that in
previous
years
payment has not been made al a uniform rate.
But it
is diflicult to sec how the principle which applies to a
case of payment at the time of a festival can be extended
to infer an implied term of payment where the payment
has been made entirely unconnected with any festival
and at rates which have varied from year to year.
We
arc therefore of opinion that when
this
Court
laid
down that there was an implied condition of service
to pay something about the time of puja festival
in
lspalzani's case( 1 ) it was clear that such implied condition of service could be inferred where the rate of payment was not unifom1 only when such
payment was,
obviously connected with some festival.
Jn the present case also, the payment has not been uniform over
the years and therefore before an implied term of service to pay bonus can be inferred it must b~ shown that
the payment was connected with some
festival.
It
would in our opinion be impossible to infer an implied
condition of service where payment has not been uniform in the past, unless such payment can be connected with some festival.
We are therefore of
opinion
that the tribunal was wrong in holding
that an
inference could be drawn for payment of bonus as an implied condition of service in the circumstances of the
present case when the payment was not uniform in the
past even though it
was
not connected
with
any
festival."
The above observations clearly establish that when payment
of honus has not heen uniform, over the years, as in the case before us, it is impossible to infer its payment as an implied condition of service, unless such
payment is
connected with
some
festival: and, in this case, we have also rcforred to the fact that
the respondents have not made any claim for bonus, in relatioio
to a festival.
All these decisions have again heen reviewed. by this Court,
in Bombay Company (Private) Ltd. v. Their Employees('). In
this decision. this Court rejected the
approach made, by
the
(\)
[l'YiO] I S.C.R. 24.
(2) Civil Appeal N0. 659of1966. decided 0n 22-9-1967
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CHURAKULAM TEA ESTATE v. WORKMEN (Vaidialingam, !.) 939 •
Tribunal, for accepting a claim for bonus, as an implied condition of service; but proceeded to consider the question as to
whether the claim can be rested as a customary or festival bonus.
This Court negatived even such a claim, on the ground that payment had not been made at a uniform rate.
It further adverted
to an earlier decision, in Jardine Henderson Ltd. v. The Workmen
& Anr. (1) wherein it has been held that customary bonus must
always be connected with some festival.
From the decisions, cited above, it follows that the Tribunal,
in the instant case, was wrong in holding that an inference could
be drawn for payment of bonus, as an implied condition of service, in the circumstances of the present case, when the payment,
admittedly, was not uniform and was not connected with any
festival. In our view, it is impossible to infer an implied condition of service, where payment has not been uniform in the past,
unless such payment can be connected with some festival. In this
case, admittedly, the payments have neither been uniform,
nor
were they connected with any festival.
The claim cannot also be sustained, even as a customary or
traditional bonus, because, apart from the fact that it is not connected with any festival, one of the essential ingredients, viz., that
the payment should have been at a uniform rate throughout, is
also admittedly lacking in this case.
Therefore, the Tribunal was
in enor in awarding bonus for the three years in question.
The second question, that arose for consideration by the Tribunal, related to the claim for wages, of the twenty-seven factory
workers, who went on strike on November 30, 1961. There is no
controversy that the factory workers alone went on strike, for
half a day, on November 30, 1961. . The Tribunal has awarded
wages for this period. Mr. Gokhale, learned counsel, contended
that the strike was both illegal and unjustified. The events leading up to the strike, on that date, may be briefly noted. The conciliation proceedings relating to the claim for bonus having failed,
the question of refening for adjudication to the
Tribunal was
under consideration of the Government.
The Labour Minister
had called for a conference of the representatives of the management and the workmen and the conference had been fixed on
November 23, 1961. The representatives of the workmen attended the conference, but the management boycotted the same. It is
the case of the workmen that to protest against the recalcitrant
attitude of the management is not attending the conference, the
twenty-seven factory workers alone went on strike, from 1 p.m.,
on November 30, 1961.
In support of his contention that the strike was illegal, Mr.
• Gokhale relied on s. 23(a) of the Industrial Disputes Act, 1947
(I) [1962] Supp, 3 S.C.R. 582.
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[1969] I S.CR
(Act XIV of 1947) (hc:rcinaftcr called the Act). The said pro·
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vision is as follows :
"23. J\o workman who is employed in any industrial establishment shall go on strike in breach of contract and no employer of any such workman shall declare a lock-out-
( a) during the pcndency of conciliation
proceedings before a Board and seven
days after the
conclusion of such proceedings;
,.
The expression 'Board' is defined in s. 2( c) as a Board of Conciliation, constituted under the Act.
Admittedly there were n<>
conciliation proceedings pending befor.I! such a Board on Novcm·
ber 30, 1961, the day on which the factory workers went or
strike and hence the strike docs not come under s. 23(a). Ne
doubt if the strike. in this case, is hit by s. 23 (a), it will be illegal
under s. 24( I )(i) of the Act; but we have already held that
i1
does not come under s. 23(a) of the Act.
It follows that
th~
strike, in this case, cannot be considered to be illegal.
Alternatively, Mr. Gokhale contended that in any event the
strike on ~ovcmbcr 30, 1961. was thoroughly unjustified. Coun·
sci urged that the management had participated in the concilia·
:ion proceedings, rclatin1~ to the claim for bonus and, when th(}SC
proceedings failed, the question of referring the dispute, ior ad··
judication, was pending before the Government.
The workmen
could have made a request to the Government to refer the dispute
for adjudication and, thi!refore, the factory workers' going on
strike cannot be justified. 1n this connection Mr. Gokhale referred us to the observations. made by this Court, in
M anai?ement
of Chandramalai E1·tate, Ernaku/am v. Its Workmen(').
In the
said decision, this Court deprecated the conduct of workmen go·
ing on a strike, without waiting for a reasonable time to know the
result of the report of conciliation proceedings. In our opinion.
this decision docs not at all support the appellant.
Thcr.~ is a fundamental follacv. in
this
contention of th,·
appellant, when it proceeds on the basis that the strike by
the
factorv workers, on November 30, 1961, was directly in co11ncction with the demand for bonus for the years 1957 to 1959. On
the other hand the evidence, which has been pbced before us by
\fr. Puri learned counsel for the respondent, clearly establishes
that the strike was as a protest against the unreasonable attitude
of the management in boycottin.g the conference held on November 23, 1961 by the Labour Minister of the State. The evidence.
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CHURAKULAM TEA ESTATE V. WORKMEN (Vaidialingam, /.)941
of W-1, the Secretary of the Union, is to the effect that to protest
against the attitude of the management in boycotting the conforence held on November 23, 1961, the factory workers went on
a token strike for half a day, on November 30, l 961. There is
no cross-examination of this witness, on this aspect.
There
is
also nothing in the evidence, adduced by the management to show
that the strike on November ·30, 1961 was not for
the reason
spoken to by the Union Secretary. Therefore, the strike must h~
held to be neither illegal nor unjustified and in consequence it
must be further held that the factory workers are entitled to wages
for that day.
The finding of the Tribunal, in this regard,
is
accepted.
The last question, that arises for consideration, relates to the
claim for wages of the workmen, for the period of lay-off, viz.,
December 1, 1961 to December 8, 1961. On the very day that
the factory workers went on strike i.e., November
30,
1961.
the management put up a notice, Exhibit M-15, to the effe"t that
since all the factory workers had gone on strike at 1 p.m., without previous intimation, the management was forced to
lay-off
without compensation all the workmen in the entire establishment, as from December 1, 1961, under s. 25E(iii) of the Act
which lays down that no compensation shall be paid to a. workman who has been laid-off, if such laying-off is due to a strike or
slowing-down of production on the part of workmen in another
part of the establishment.
The correspondence shows that due
to the intervention of the Deputy Labour Officer, the Management was assured, on December 7, 1961, that the workmen would
not resort to any strike and, accordingly, the lay-off was withdrawn from December 8, 1961 but the management stated that
no compensation would be paid for the period of the Jay-off.
Here, again, the plea of the workers is that all of them reported for duty on December 1, 1961, but they were not given any
work by_ the management on the ground that there was a lay-off.
This plea has been found to be true, by the Tribunal, but,
according to the management, the Jay-off, in this case, during this
period, is justified, under the provisions of s. 25E( iii) and hence
the workmen are not entitled to compensation.
According to
the management, inasmuch as there was a strike in the factory
section, work in the other sections could not be carried on; and.
as the management were not sure whether the workmen would
turn up for work, lay-off, in the circumstances, was justified. We
are not inclined to accept this contention advanced on behalf of
the management. We have already referred to the finding of the
Tribunal that twenty-seven factory workmen alone went on strike
on November 30, 1961, and the entire body of workmen presented themselves for work on December 1, 1961, but they were
"declined work by the management on the ground of lay-off. The
plea of the management that they suffered loss, on account of the
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942
SUPREME COURT REPORTS
[1969] I S.C.R.
half a day's strike on November 30, 1961, justifying the lay-off,
A
has not been accepted by the Tribunal. In fact the Tribuna! has
<Iccepted the plea of the workmen that the effect of the three
hnurs' token strike on r\ovcmber 30, I 961, would not have rernltcd in any loss to the management, if they had
allowed · the
workmen to do work on December 1, 1961.
TI1e Tribunal has
also held that th.~ lay-off, by the management, was as a retaliatory
B
or vindictive measure against the factory workers, who went on
'trike on November 30, 1961.
We arc in 'agreement with
the
findings, recorded by the Tribunal in this behalf and the award
t-v the Tribunal of wages to the workmen for this period is justi-
!icd.
In the result, the award of the Industrial Tribunal, dated SepC
tember 21, 1964, in l.D. No. IO of 1962, in so far as it granted
bonus to the workmen for the years 1957 to 1959, is set aside,
and the appeal is allowed to that extent; in other respects,
the
appeal stands dismissed.
Parties will bear their own costs of this
appeal.
Y.P.
Appeal partly allowed.
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