# MCKENZIE & CO. LTD v. ITS WORKMEN AND OTHERS

- **Citation:** [1959] Supp. 1 S.C.R. 222
- **Court:** Supreme Court of India
- **Decided:** 1956-09-28
- **Bench:** Jafer Imam, S. K. Das, J. L. Kapur
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/mckenzie-co-ltd-v-its-workmen-and-others-1646
- **Pages:** 16

## Headnote

Industrial Dispute-Illegal strike-Enquiry by companyRejection by Tribunal of application for permission to dismiss workmeH-Fresh enquiry, if barred-Notice of enquiry, how to be effected
-Dismissal after fresh enquiry-Jurisdiction of Tribunal-If can
interfere with decision of company-Industrial Disputes Act (XIV
of r947), s. 33·
During the pendency of the adjudication of a reference before the Industrial Tribunal, the workmen illegally confined the
work-$ manager and went on strike. The company issued notices
to the workmen to resume '\'Ork immediately but they refused.
The company declared a lock out and served charge sheets on
the workmen calling upon them to submit their explanations.
No explanation having been submitted the company held an
enquiry and found the workmen guilty of gross misconduct
amounting to major misdemeanour which merited dismissal.
The company applied to the Tribunal under s. 33 of the Industrial Disputes Act for permission to dismiss the workmen.
The
Tribunal granted permission in respect of three workmen but
refused it in respect of 6I workmen on the ground that there was
reasonable doubt as to their identity and complicity in the
incident. The order was upheld in appeal by the Labour Appellate Tribunal. Thereupon the company took fresh. proceedings
against the 64 workmen. It sent charge sheets to them by
registered notices to their addresses registered with the company and also affixed notices on its notice boards both inside
the premises and outside the gate. The registered notices could
not be served upon workmen Nos. 2 to 24 as they were not found
at the addresses given. The company wrote to the Workers
(1) S.C.R. SUPREME COURT REPORTS
223
Union•for the addresses of these workmen but received no reply.
The company held the enquiry and, as at that time no proceedings were pending under the Act, terminated the services of the
64 workmen. The Government made a reference in respect of
the termination of services of the workmen. Sixteen workmen
resigned and one pleaded guilty. With respect to the rest the
Tribunal held that workmen Nos. 2 to 24 had not been properly
served and the order of the terminatiop of their services was bad
but upheld the order in respect of the remaining workmen. Both
parties appealed to the Labour Appellate Tribunal. The Appellate Tribunal dismissed the appeal of the company but allowed
that of the workmen holding that the testimony of the works
manager could not be accepted and apart from that evidence
there was no other evidence to show which of the workmen had
taken part in wrongfully confining the works manager and in the
illegal strike.
Held, that the Appellate Tribunal was in error in setting
aside the order of termination of service on the ground that it
was unable to accept the testimony of the works manager. It
was for the management to determine what constituted major
misconduct within its standing orders sufficient to merit dismissal of a workman but in determining such misconduct it must
have facts upon which to base its conclusions, and it must act in
good faith, without caprice or discrimination or motive of
vindictiveness or intimidation, without resorting to unfair labour
practice and in accordance with the accepted rules of natural
justice. When the management has so acted its judgment cannot be questioned. -The Appellate Tribunal proceeded as if it
were sitting in appeal against the decisions of the managerial
enquiry and this was beyond the scope of its powers.
Indian Iron and Steel Co. Ltd. v. Their Workmen, A. I. R.
1958 S.C. 130; Lakshmi Devi Sugar Mills Ltd. v. Pt. Ram Sarup,
A. I. R. 1957 S. C. 82 and Hanuman Jute Mills v. Amin Das,
A.LR. 1957 S.C. 194, followed.
Held, further, that both the Industrial Tribunal and the
Appellate Tribunal were wrong in holding that proper notices
had not been given to workmen Nos. 2 to 24.
The standing
order merely required that service of notice upon a workman
may be made by communicating the same orally to the worker
a

## Text

222
SUPREME COURT REPORTS [1959] Supp.
r958
agent whereby the latter was enabled to and did
-
act. as such. The appellant's election was consequDr. Y. S. Parmar
ti ·
· ·
· ht! d J
d
'd
en y m our opm10n rig
y ec aro vm .
sh. m:~ 5;,.gh
The appeal is therefore dismissed with costs.
1.)aul and Another
Sarka, ].
OcJober z7.
Appeal dismissed.
MCKENZIE & CO. LTD.
v.
ITS WORKMEN AND OTHERS
(JAFER IMAM, S. K. DAS and J. L. KAPUR, JJ.)
Industrial Dispute-Illegal strike-Enquiry by companyRejection by Tribunal of application for permission to dismiss workmeH-Fresh enquiry, if barred-Notice of enquiry, how to be effected
-Dismissal after fresh enquiry-Jurisdiction of Tribunal-If can
interfere with decision of company-Industrial Disputes Act (XIV
of r947), s. 33·
During the pendency of the adjudication of a reference before the Industrial Tribunal, the workmen illegally confined the
work-$ manager and went on strike. The company issued notices
to the workmen to resume '\'Ork immediately but they refused.
The company declared a lock out and served charge sheets on
the workmen calling upon them to submit their explanations.
No explanation having been submitted the company held an
enquiry and found the workmen guilty of gross misconduct
amounting to major misdemeanour which merited dismissal.
The company applied to the Tribunal under s. 33 of the Industrial Disputes Act for permission to dismiss the workmen.
The
Tribunal granted permission in respect of three workmen but
refused it in respect of 6I workmen on the ground that there was
reasonable doubt as to their identity and complicity in the
incident. The order was upheld in appeal by the Labour Appellate Tribunal. Thereupon the company took fresh. proceedings
against the 64 workmen. It sent charge sheets to them by
registered notices to their addresses registered with the company and also affixed notices on its notice boards both inside
the premises and outside the gate. The registered notices could
not be served upon workmen Nos. 2 to 24 as they were not found
at the addresses given. The company wrote to the Workers
(1) S.C.R. SUPREME COURT REPORTS
223
Union•for the addresses of these workmen but received no reply.
The company held the enquiry and, as at that time no proceedings were pending under the Act, terminated the services of the
64 workmen. The Government made a reference in respect of
the termination of services of the workmen. Sixteen workmen
resigned and one pleaded guilty. With respect to the rest the
Tribunal held that workmen Nos. 2 to 24 had not been properly
served and the order of the terminatiop of their services was bad
but upheld the order in respect of the remaining workmen. Both
parties appealed to the Labour Appellate Tribunal. The Appellate Tribunal dismissed the appeal of the company but allowed
that of the workmen holding that the testimony of the works
manager could not be accepted and apart from that evidence
there was no other evidence to show which of the workmen had
taken part in wrongfully confining the works manager and in the
illegal strike.
Held, that the Appellate Tribunal was in error in setting
aside the order of termination of service on the ground that it
was unable to accept the testimony of the works manager. It
was for the management to determine what constituted major
misconduct within its standing orders sufficient to merit dismissal of a workman but in determining such misconduct it must
have facts upon which to base its conclusions, and it must act in
good faith, without caprice or discrimination or motive of
vindictiveness or intimidation, without resorting to unfair labour
practice and in accordance with the accepted rules of natural
justice. When the management has so acted its judgment cannot be questioned. -The Appellate Tribunal proceeded as if it
were sitting in appeal against the decisions of the managerial
enquiry and this was beyond the scope of its powers.
Indian Iron and Steel Co. Ltd. v. Their Workmen, A. I. R.
1958 S.C. 130; Lakshmi Devi Sugar Mills Ltd. v. Pt. Ram Sarup,
A. I. R. 1957 S. C. 82 and Hanuman Jute Mills v. Amin Das,
A.LR. 1957 S.C. 194, followed.
Held, further, that both the Industrial Tribunal and the
Appellate Tribunal were wrong in holding that proper notices
had not been given to workmen Nos. 2 to 24.
The standing
order merely required that service of notice upon a workman
may be made by communicating the same orally to the worker
and/or by fixing the same on the company's notice board.
The
Company acted in conformity with this standing order by affixing
the notices on its notice board.
Held, further, that the second enquiry was not barred by
the principle of res judicata on account of the previous findings
of the Tribunal on the application under s. 33.
As the purpose
of s. 33 is merely to give or withhold permission and not to
adjudicate upon an industrial dispute, any finding under s. 33
could not operate as res judicata and bar the raising of an industrial dispute. There was nothing in s. 33 or in the findings of the
Mckenzie & Co.
Ltd.
v.
Its Workmen
and Otlu:rs
lifcke11~ie $..Co.
Ltd.
v.
Its lVorkmen
and Others
224
SUPREME COURT REPORTS [1959] Supp.
Tribunals in the s. 33 proceedings which could debar the company from holding the second enquiry and dismissing the workmen.
CIVIL APPELLATE .JuRISDIC'rION: Civil Appeal No.
500 of 1957.
Appettl by special leave from the judgment and
order dated Septembiir II, 1956, as altered by Order
dated September 28, 1956, of the Labour Appellate
Tribunal of India, Calcutta, in Appeals Nos. Cal.
208 and 223 of 1956, arising out of the Award dated
June 7,
1956, of the Sixth Industrial Tribunal,
Calcutta, in Case No. VIII-233 of 1955.
M. C. Setalvad, Attorney-General for India, D. N.
Mukherjee and B. N. Ghosh, for the apvellants.
Y. Kumar, for respondents Nos. 2 to 25 and 27 to 48.
1958. October 17.
The J"udgment of the Court was
delivered by
KAPUR, J.-This is an appeal by special leave
against the order of the Labour Appellate Tribunal
and the question for decision is the dismissal of some
workmen. The appellant before us is the employer
and the respondents are some of the workmen, 4 7 in
number who might be divided into two sets, the first
set Nos. 2 to 24 and second Nos. 25 to 48. Out of the
latter No. 26 is dead.
The facts leading to the appeal are that on August
3, 1953, the Government of West Bengal referred
under s. IO of the Industrial Disputes Act, hereinafter
called the Act, to the second Industrial Tribunal, an
industrial dispute between the appellant and its workmen.
During the pendency of this Reference the
workmen acted in a manner subversive of discipline,
wilful insubordination and disobedience inasmuch as
they surrounded by forming a kind of cordon round
E. L. D'Cruz, acting Works :Manager of the company,
illegally confined him in a small place in the factory
premises and kept him so confined between the
hours of 9-15 a.m. to 2-15 p.m., till he was rescued by
th<J police. The cause of this action on the part of
the workmel). is stated to be a dispute as to the payment of Puja bonus for the year 1953. The same
(1) S.C.R.- SUPREME COURT REPORTS
225
day the workmen went on strike at 9-15 a.m. D'Cruz
called upon them to resume work but they refused and
the appellant-company issued notices at 9-45 a. m.,
and 10-45 a.m. asking the workmen to resume work
immediately. The workmen took no notice of these
notices and the appellant company after the arrival of
the police declared a lock out. Some of the workmen
were then arrested. The appellant company then
served charge sheet on the workmen calling upon
them to submit their_ explanations within 24 hours.
Tlw workmen gave no explanation. An enquiry was
held and the workmen were found guilty of gross misconduct amounting to major misdemeanour which
merited dismissal and the company proposed to dismiss
them. ]'or that purpose the appellant company on
October 31, 1953, ma.de three applications Cal. Nos. 518,
519 and 557 of 1953 to the Tribunal for permission under s. 33 of the Act to dismiss 170 workmen
with effect from October 6, 1953. During the course of
the proceedings the appellant company .withdrew its
case against a large number of workmen anll the proceedings were ultimately continued against 67 workmen. One of these workmen died and two· resigned
leaving 64 workmen against whom the proceedfngs
were continued.
The workmen in their defence denied the commission of any offence and also denied the receipt of
charge sheets. They pleaded that there was no enquiry, that the lock-out was illegal and that the appellant had acted in contravention of the principles
ofnatural justice. The three applications were heard
. together and were disposed of by one order. The
Tribunal held that a prima f acie case had been made
out for granting permission for dismissal of workmen
directly involved in the incident; that the appellant
company had acted bona fide and that it was not guilty
of discrimination, vindictiveness or arbitrary action.
Although it had started cases against 170 workmen it
took back a majority of them on their expressing
regret. The Tribunal gave permission for the dismissal of only three workmen Subbas Roy, Madhusudhan
29
Mckenzie & Co.
Ltd.
v.
Its Workme.t
and Others
Kapur].
Mckenzie & Co.
Ltd,
v.
JJs JV01k111en
and Othi:rs
J(apur J.
226
SUPREME COURT REPORTS [1959) Supp.
Rout and Bimal Kumar Ghose and permission with
regard to the rest was refused on the ground that
there was reasonable doubt as to their identity and
complicity in the incident.
On January 8, 1954, the workmen made an application under s. 33A of the Act which was allowed on
July 2, 1954. Three appeals were filed, two by the
appellant company against the orders under s. 33 a.nd
the other made unde;ii s. 33A of the Act. The third
appeal was filed by workmen as to the dismissal of
three workmen. On March 29, 1955, the appeal of the
company with regard to application under s. 33 of the
Act was dismissed and so was the appeal of the workmen and thus the order as to 3 workmen was upheld.
The employers contended that as the strike was illegal,
the management had the right to terminate the
services of the workmen and the Tribunal was therefore bound to accord sanction to the management but
the Labour Appellate Tribunal did not go into this
matter as the question had not been raised at any previous stage. On the same day the Labour Appellate
Tribunal set aside the order of the Tribunal under
s. 33A on the ground that the app1ication under that
·section was misconceived and the order made by the
Tribunal was without jurisdiction.
On April 20, 1955; the management of the appellant
company took fresh proceedings against the 64 workmen and in order to serve charge sheets on them sent
registered notices to their addresses, registered with
the appellant company, and also affixed notices on its
Notice Boards both inside the premises and outside the
gate of the premises which remained affixed there from
April 20, 1955, till June 9, 1955. Out of the registered
notices sent notices could not be served on workmen
Nos. 2 to 24 and they were returned to the sender with
the remark that the addressees had either left or their
addresses were unknown. On April 28, 1955, the appellant company wrote a letter to the Labour Commissioner informing him of the offences committed by the
workmen and the action that it proposed to take
against its workmen. On May 20, 1955, the appellant
company wrote to the secretary of the Workers' Union
(1) S.C.R. SUPREME COURT REPORTS
227
asking him for the addresses of the workmen who had
not been served but it received no reply from the
secretary. The enquiry started by the management
of the appellant company terminated on June 9, 1955,
and as at that time no proceedings were pending under
the Act, the appellant company terminated the services
of all the 64 workmen on June 22, 1955.
The termination of the services of these workmen
gave rise to an industrial dispute and a reference was
made by the West Bengal Government on August 8,
1955, in regai'd to all the 64 workmen. The points
referred for adjudication were:-
(1) Whether the dismissal of the 64 workmen mentioned in the attached list is justified.
Whether the
Company should not reinstate them. What compensation should they be paid for the action taken against
them by the Company ?
(2) What compensation should be paid to them in
respect of the period of enforced idleness from 6-10-53,
particularly for the period they were refused perinission to rejoin work even after their cases had been disposed of by the Tribunal?
(3) Whether the Tribunal Awards concerning the
64 workmen have been properly implemented. What
compensation should be paid to them by the company
for not having properly implemented the Award?
Sixteen workmen resigned and one of them Haroo
Haldar pleaded guilty and therefore proceedings were
continued against only 47 workmen.
The Tribunal
(6th Industrial Tribunal, West Bengal) made its award
on June 7, 1956. It held that the workmen Nos. 2 to
24 had not been properly served and ordered their
reinstatement as from April 1, 1955, with back wages,
dearness allowance, etc., from April 1, 1955, but upheld
the dismissal of workmen Nos. 25 to 48. It held that
there was evidence to establish the identity of persons
who had taken part in the strike and had wrongfully
confined D'Cruz and that no bias or illwill could be
attributed to the management nor was it inspired by
any vindictive motives. It said:
" Since there was evidence and it was a possible
Mckcnoic & Co.
Ltd.
v.
Its Workme11
a11d Others
]{apur ].
It! ckenzie & Co.
Ltd.
v.
Its Workmen
and Others
J(apur ].
228
SUPREME COUR'r REPORTS [1959] Supp.
view, the Tribunal must accept the finding and hold
that the dismissal of those workers was justified".
. In regard to wages the Tribunal held that the strike
of October 6, 1953, was illegal as at that time the
reference was pending before the Industrial Tribunal;
that the lock out was fully justified as the strikers had
taken a belligerent attitude and had actually kept the
acting Works Manager illegally confined till he was
rescued by the police; that no compensation could there·
fore be claimed for the period from October 6, 1953, upto
the time that the Labour Appellate Tribuilal on March
29, 1955, qisposed of the proceedings under s. 33; but
.the workmen Nos. 2 to 24 who were held to be wrongfully dismissed and had been ordered to be reinstated.
but had not been allowed to return to work were
entitled to wages but only from April l, 1955, upto the
date of reinstatement. On the third issue i. e. the
matter of Subbash ltoy, Madhusudan Rout and Bimal
Kumar Ghosh permission for dismissal granted by the
State Tribunal was confirmed on appeal. No question
of compensation could arise in their case.
Against this order of the 6th Industrial Tribunal,
two appeals were taken to the Labour Appellate Tribunal one by the Union and the other by the appellant
company. On September II, 1956, the Labour Appellate Tribunal dismissed the appeal of the appellant
company and allowed that of the Union. It held that
the evidence of E. L. D'Cruz given in the managerial
enquiry in May 1955 could not be accepted. In its
order the Appellate Tribunal said:-
"In June 1954 Mr. E.L. D'Cruz was unable to give
evidence against the appellants in Appeal No. Cal. 223
of 1956. In May 1955 he gave evidence connecting
the appellants with the misconduct that was committed on the 6th October, 1954. No other evidence is to
be found on the record to show that the workmen who
are concerned in these proceedings committed misconduct on the 6th October, 1954."
In these circumstances, it is difficult to act on the
evidence' given by Mr. E.L. D'Cruz in the managerial
enquiry in May 1955 ".
After refering to the principles laid down in the case of
(1) S.C.R. SUPREME COURT REPORTS
229
Buckingham and Carnatic Co. Ltd. v. Its workmen (1)
the Labour Appellate Tribunal ruled out the evidence
of D'Cruz and as there was no other evidence to
prove misconduct against the workmen, it came to the
conclusion that the decision of the managment was
perverse. It held :-
" In these circumstances, we set aside the order of
the Industrial Tribunal giving permission to tho
management to discharge the appellants from
service"
and consequently the order of the Industrial Tribunal
giving permission to discharge workmen Nos. 25 to 48
was set aside.
The Appellate Tribunal suo motu
amended this order on September 28, 1956, and the
following order was substituted in place of the operative portion of the order of September 11, 1956:
" In these circumstances we set aside the order of
the Industrial Tribunal upholding the action of the
Management in discharging
the appellants from
service ........ In the result the Award under appeal confirming the action of the Management in discharging
twenty four workmen from service is set aside. In
other respects that Awa.rd is confirmed. In other words
we order the reinstatement of the twenty four workmen discharged by the Management with back wages
for the period between the 1st of April, 1955, to the
date of reinstatement".
Against this order the. appellant company has come
up in appeal by special leave and .on its behalf the
learned Attorney General raised two questions: (1) that
appeal to Labour Appellate Tribunal on behalf of the
Union was not competent as no question of law was
involved and (2) that it could not sit in appeal against
the managerial enquiry. It is not necessary to go into
the first question because, in our opinion, the second
question raised is well founded.
The principles which
govern the power of an Industrial Tribunal to interfere
with the decision of the employer following an cnquicy
made by him were laid down by this Court in Indian
Iron and Steel Co. Ltd. v. 'l'heir Workmen(") where
S. K. Das J., said at page 138 :
(1) (1952) L.A.C. 490.
(2) A.I.R. 1958 S.C. 130.
Mckenzie & Co.
Ltd.
v.
Its Workmen
and Others
]{apur ].
!vlcken::ie Q>. Co,
Ltd.
v.
Its Worl11nr.n
und Others
J(uj>ur ].
230
SUPREME COURT REPORTS [1959) Supp.
"Undoubtedly, the management of a concern has
power to direct its own internal administration and
discipline; but the power is not unlimited ar.d when a
dispute arises, Industrial Tribunals have been given
the power to see whether the termination of service of
a workman is justified and to give appropriate relief.
In cases of dismissal or misconduct, the Tribunal does
not, however, act as a Court of appeal and substitute
its own judgment for that of the management. It will
interfere (i) when there is want of good faith, (ii) when
there is victimisation or unfair labour practice, (iii)
when the management has been guilty of a basic error
or violation of a principle of natural justice, and (iv)
when on the materials, the finding is completely baseless or perverse."
In Lakshmi Devi Sugar .Mills Ltd. v. Pt. Ram Sarup (1)
which was a case under s. 22 of the Industrial Disputes
(Appellate Tribunal) Act, 1950, ~his Court held that if
it was established that the workmen had resorted to
illegal strike, that a fair enquiry into the alleged
misconduct and insubordination of the workmen had
been held by the management without violating any
principles of natural justice and as a result of enquiry
the management had found the workmen guilty of
misconduct and insubordination with which they had
been charged and the management had come to the
conclusion that continuing the workmen in its employ
was dangerous in the interest of the company the
Tribunal would not interfere with such order.
In Hanuman Jute 111ills v. Amin Das (2) it was held
th•it no appeal lies against the order of an Industrial
Tribunal where the Tribunal had examined the question whether the discretion of the employer to dismiss
certain workmen was properly exercised, whether the
employer was acting bona fide, whether he had resorted to any unfair labour practice or victimisation and
whether his desire to dismiss the workmen was actuated by any improper motive.
It is for the management to determine what constitutes major misconduct within its standing orders
sufficient to merit dismissal of a workman but in
(1).A.l.R. 1957 S.C. 82.
(2) A.I.R. 1957 S.C. 194.
(1) S.C.R. SUPREME COURT REPORTS
231
determining such misconduct it must have facts upon
which to base its conclusions and it must act in good
faith without caprice or discrimination and without
motives of vindictiveness, intimidation or resorting to
unfair labour practice and there must be no infraction
of the accepted rules of natural justice. When the
management does have facts from which it can conclude misconduct its judgment cannot be questioned
provided the abovementioned principles are not violated. But in the absence of these facts or in case of
violation of the principles set out above its position is
untenable.
In our opinion, the Industrial Tribunal proceeded on
correct principles as to its power in regard to an
enquiry held by the management and the Labour
Appellate Tribunal seems to have approached the question as if it was sitting in appeal against the decision
taken by the management in regard to the termination
of service of their workmen. In the instant case none
of the principles, which have been laid down by Labour
Courts as well as by this Court in regard to enquiry by
the management into the misconduct of their workmen, have been violated and the Labour Appellate
Tribunal was in error in setting aside the order of the
Industrial Tribunal on the ground that it was unable
to accept the testimony of D'Oruz as to the identity of
persons who had taken part in wrongfully confining
him on the day of the illegal strike. It appears to
have proceeded as ifit was sitting in appeal against
t!E decision of the managerial enquiry and further it
was under a misapprehension as to the nature of the
proceedings before the Industrial Tribunal and before
itself, inasmuch as it seems to have been under the
wrong impression that the appeal before it arose out of
an application under s. 33 of the Act and that the
Industrial Tribunal had given permission to the appellant company to discharge its workmen. Its amended
order shows that it thought, and again wrongly, that
really the proceedings were under s. 33A of the Act
and it was that mistaken view of the nature of the
proceedings which led to its order for reinstatement of
the workmen with back wages from April 1, 1955, to
Mckenzie & Co.
Ltd.
v.
Its Workmen
and Others
Kapur J.
Mckenzie &- Co.
LJd.
v.
Its TVorkmen
and Others
J<apur J.
232
SUPREME COURT REPORTS [1959] Supp.
the date of reinstatement. The Labour Appellate
Tribunal seems to have overlooked the fact that the
appeal before it arose out of a. Reference made by the
West Bengal Government under s. 10 of the Act. This
misconception as to the nature of the proceedings
vitiated its order as the Appellate Tribunal misdirected
itself as to the scope of the powers to be exercised by it
and consequently it led to the making of an erroneous
order.
The question then arises as to whether the managerial enquiry was vitiated by the infraction of any
principle of natural justice. According to the standing
orders Major Misdemeanours have been defined in cl. 15,
the relevant portion'of which is:-
(a) Wilful insubordination or disobedience.
(b) Inciting to take pa.rt or taking part in an illegal
strike. (Any strike resorted to without giving notice
as provided under Section 22 of the Industrial Disputes
Act will be considered as illegal)".
The mode of service of notice as given in the standing
order No. 15 is as follows:-
" No order of dismissal shall be made unless the
worker concerned is informed and given opportunity
of explaining the circumstances alleged against him,
but to avail himself of this privilege such worker must
attend before the management when directed to do so.
Service of any notice or direction upon a workman to
attend under this rule may be made by communicating
the same orally to the worker concerned and/or lily
fixing the same on the Company's Notice Board".
In the present case the management of the appellant
company took the precaution of affixing the notices on
its Notice Boards both inside and outside the company's premises, and there is evidence to show that they
remained affixed from April 20, 1955 till June 9, 1955,
i.e. right upto the termination of the enquiry. It also
sent Registered Acknowledgement Due notices to a.II
workmen. When some of them came back unserved
it wrote to the secretary of the Union asking for the
addresses of the workmen but that gentleman did not
care to reply to this letter. The management also wrote
(1) S.C.R.
SUPREME COURT REPORTS
233
to the Labour Commissioner as to the action it was
proposing to take.
The Industrial Tribunal held that there was no
proper notice to workmen Nos. 2 to 24 and the mere
atlixing of the notices on the Notice Board of the compnny wa.s not sufficient as the workmen could not
enter the appellant company's premises due to the lock
out. It overlooked the evidence as to the notices being
affixed on the appellant company's board outside its
gate from where the workmen were not excluded as a
result of the lock out and it was open to them if they
so desired to go and look up the notices there. Further
the Tribunal was of the opinion that the appellant
company might have sent the notices to the secretary
of the Union " for circulation to the absentees ". In the
first place this is not one of the recognised modes of
effecting service and in this m1se the company would
have been justified in not taking this action after the
way that gentleman had neglected even to reply to the
appellant company's letter asking him to supply the
addresses of the workmen. Apart from complying with
its standing orders the appellant company made every
effort under the circumstances to serve notices on its
workmen. No principle of natural justice has, in our
opinion, been infringed and the finding as to the workmen having no notice of the charges against them and
consequently not having a proper opportunity to meet
the case against them cannot be sustained. It cannot
be said that the workmen did not have a proper
opportunity to answer the case against them. If the
rule were as the order of the Industrial Tribunal holds
it to be then by their action of not giving proper
addresses to the employer or abstaining from looking
up the Notice Boards where under the standing orders
notices were required to be atfixed the workmen might
make it impossible for an employer to take disciplinary
action assuming that such action is necessary or justified. The Labour Appellate Tribunal did not consider
01· apply its mind t.o this aspect of the case, it being
under a misapprehension as to correct naturn of the
proceedings.
30
Mcltenzie &- Co.
Ltd.
v.
[/.c; lVork111en
tmd Ot lm·s
Kaf"" .J.
Nlckenzie & Co.
Ltd.
v.
Its Workmen
and Others
Kapu.r j.
234
SUPREJ\IE COURT REPORTS [1959] Supp.
Counsel for respondents raised four points: (I) that
there was no proper notice served on workmen Nos. 2
to 24 after the decision of the Industrial Tribnnal
refusing permission to dismiss the workmen under s. 33
of the Act; (2) that no second enquiry could he held
because the earlier findings of the Tribunal on the
application under section 33 of the Act would not he
challengeable on the principle of res judicata; (3) that
there are basic errors in the award of the Industrial
Tribunal which was rightly interfered with on appeal
by the Labour Appellate Tribunal and (4) that the
workmen were entit,Jed to compensation. As to noticeH
the submission of the counsel for the respondents was
that notice given to the workmen Nos. 2 to 24 was not
adequate as the employer did not send the notices to
the Union for being served on the workmen and in any
case in order to serve the workmen properly it was
necessary in the circumstances of this case for the
employer to advertise the case in Bengalee newspapers.
\Ve have already held that in the circumstances of
this case the appellant company had done its best to
serve the workmen and had com plied with the standing orders and it was not necessary for the appellant
to do anything more.
This contention of the respondents' counsel must therefore be repelled.
Afl to the applicability of the principle of res judicata
the argument raised by counsel for respondents was
that t,he findings of the State Industrial Tribunal in
proceedings under s. 33 of the Act which were confirmed by the Labour Appellate Tribunal barred the right
of the management of the appellant company to start
a fresh enquiry in respect of the same incident which
formed the subject matter of the previous enquiry.
There is no force in this contention, which seems to be
based on a misapprehension as to the nature and sc0pe
of proceedings under s. 33. That section does not confer any jurfadiction on a Tribunal to adjudicate on a
dispute but it merely empowers the Tribunal to give
or withhold permission to the employer during the
pendency of an industrial dispute to discharge or
punish a workman concerned in the industrial dispute.
And in deciding whether permission should or should
(1) S.C.R.
SUPREME COURT REPORTS
235
not be given, the Industrial Tribunal is not to a.ct as a
reviewing tribunal against the decision of the management but to see that before it lifts th~ ban against the
discharge or punishment of the workmen the employer
makes out a prima facie case.
The object of the
section is to protect the workmen in pending Midustrial
disputes against intimidation or victimisation. As.said
above principles governing the giving of permission in
such cases are that the employer is not acting mala
fide, is not resorting to any unfair labour practice,
intimidation or victimisation and there is no basic
error or contravention of the principles of natural
justice. Therefore when the Tribunal gives or refuses
permission it is not adjudicating an industrial dispute,
its function is to prevent victimisation of a workman
for having raised an industrial dispute. The nature
and scope of proceedings under s. 33 shows that removing or refusing to remove the ban on punishment
or dismissal of workmen does not bar the raising of an
industrial dispute when as a result of the permission of
the Industrial Tribunal the employer dismisses or
punishes the workmen. Atherton West & Go. Ltd. v.
Suti Mill Mazdoor Union (1), Lakshmi Devi Sugar
Mills v. Pt. Ram Sarup (2).
In the Automobile Products of India Ltd. v. Rukmaji
Bala (3) Das J.; (as he then was) said at p. 1256 :-
"The purpose of these two sections (s. 33 of the
Industrial Disputes Act and s. 22 of the Industrial
Disputes (Appellate Tribunal) Act) being to determine
whether the ban should be removed or not, all that is
required of the authority exercising jurisdiction under
these two sections is to accord or withhold permission·~.
As the purpose of s. 33 of the Act is merely to give
or withhold permission and not to adjudicate upon an
industrial dispute, any finding under s. 33 would not
operate as res judicata and bar the raising of an industrial dispute nor is there anything in the section itself
or in the findings arrived at by the Industrial Tribunal
in s. 33 proceedings dated June 8, 1954, or of the
La.hour Appellate Tribunal dated March 29, 1955,
(1) [1953) S.C.R. 7Po, 788.
(2~ A.I.R. 1957 S.C. 82.
(3) [1955] I S.C.R. 1241.
Mckenzie cSo Co.
Lid.
v.
Its Workmen
and Others
Kapur J.
Al cke11zie & Co.
Ltd.
v.
Tis Wo,kmen
nud Olhets
236
SUPREME COURT REPORTS
[l!l59] Supp.
which would debar the appellant company from holding the second c11quiry or dismissing ihe workmen
provided the principles above set. out arc complied
with.
It was next contended that in the present case there
was a basic error within the meaning of the rule lair!
down by S. IC Das J., in Indian Iron and Steel Co.
Ltd. v. Their Workmen(').
The basic error according
to counsel was this that the appellant company's witness Serjeant Lourds had stated that the number of
persons who had confined and were surrounding
D'Cruz was 100 to 130 persons and if out of them 106
were reinstated there could not be 67 workmen left to
be proceeded against. The appelltint company had
started proceedings agaiiist 170 workmen i. e. all their
workmen and after reinstatement of a large number
of them only 67 remained against w horn the appellant
company took proceedings with a view to take action
against them and it was in regard to these persons
that permission for dismissal was sought under s. 33.
It is significant that this basic error does not seem to
have been argued either before the Industrial Tribunal
or the Labour Appellate Tribunal, on the other hand,
the parti<'s seem to have proceeded on the basis that
the number of workmen proceeded against by the
appellant company was 67 out of whom 64 were left
after three were allowed to be dismissed. Out of the
rest 16 had resigned and there were only 48 persons
whose cases remained for adjudication by the Industrial Tribunal. No basic error is therefore made out.
The question of compensation to the workmen from
the date when they were ordered to be reinstated i.e.
from April l, 1955: to June 6, 1955, when their services
were terminated is equally unsustainable. The "Industrial Tribunal in its order of June 26, 1954, and the
Labour Appellate Tribunal in its order dated March
29, 1955, held the strike to be illegal. Mr. S. C. Sen
Gupta Judge of the 6th Industrial Tribunal who gave
the award dated June 7, 1956, refused to give any
compensation to workmen Nos. 25 to 48 whose dismissal he upheld on the ground that the strike was illegal,
(1) A.I.R. 1958 S.C. 130.
(1) S.C.R. SUPREME COURT REPORTS
237
the strikers had ta.ken up a belligerent attitude and
the lock out was fully justified. The Labour Appellate
Tribunal a.warded to the 24 workmen reinstated by its
amended order dated September 28~ 1956, back wages
from April 1, 1956, to the date of reinstatement as was
done by the Industrial Tribunal in the case of workmen Nos. 2 to 24, whom the Tribunal had ordered to
be reinstated. As we have come to the conclusion
that the order of reinstatement by the Industrial
Tribunal of workmen Nos. 2 to 24 and by the Appellate Tribunal of workmen Nos. 25 to 48 was erroneous,
neither of the two sets of workmen is entitled to back
wages by way of compensation.
The appeal is therefore allowed and the decision of
the Labour Appellate Tribunal as to all the workmen
n.nd the award of the Industrial Tribunal as to workmen Nos. 2 to 24 are set aside and the claim for compensation which was argued before us is disallowed.
As the workmen have been dismissed and no compensat.ion has been allowed tho proper order as to costs is
that both parties do pay their costs of this appeal.
Appeal allowed.
S. PL. NARAYANAN CHETTIAR
v.
M. AR. ANNAMALAI CHETTIAR
(JAFER IMAM, S. K. DAS and J. L. KAPUR, JJ.)
Debt Relief-Agriculturist-Scaling down of decree debt-Enabling statute coming into force pending appeal-Application made after
appellate decree-Whether barred by res judicata-Madras Agriculturists Relief Act, z938 (IV of z938), as amended, s. z9(2)-Madras
Agriculturists Relief (Amendment) Act (XXIII of z948), s. z6,
els. (ii), (iii).
In 1944 the respondent instituted a suit for the reco~ery
of money due under an award dated July 31, 1935, whereby the
appellant and his brother were directed to pay a certain amount
to the respondent. The suit was dismissed by the trial Court
Mckenzie 6- Co.
Lid.
v.
Its Workme11
and Others
Kapur].
October 3r.