judgement:
Appeal No. 375 of 1976.
(Appeal by Special Leave from the Judgment and Order dated 7.11.1975 of the High Court at New Delhi in Civil Writ No. 1123 of 1975) G.B. Pai, O.C. Mathur and D.N. Mishra, for the appellant.
M.K. Ramamurthi, S.C. Jain and Madan Mohan, for respond ent No. 1.
The Judgment of the Court was delivered by SARKARIA, J.
The principal question that arises in this appeal by special leave is: Whether an order of the Labour Court to the effect, that since no demand of the workmen had been served on the employer, no industrial dispute had come into existence in accordance with law, and as such the Reference was invalid and the Court had no jurisdiction to adjudicate the matter referred to it by the Government, is an "award" for the purposes of Section 19 of the , (for short, called the Act)? Cox & Kings (Agents) Ltd. (for short, the Management) dismissed from service three of their workmen after a domes tic enquiry conducted against them on certain charges.
In May 1967, the Lt. Governor of Delhi made a Refer ence under section 10 read with section 12(5) of the Act to the Labour Court, Delhi, to determine: "Whether the terminations of services of S/Shri H.S. Rawat, Bidhi Chand and Ram Sarup Gupta were unlawful and unjustified, and if so, to what relief are these workmen entitled?" By an amendment of their written statement in February, 1969, augmented by an application dated 17.8.1971; the Management raised a preliminary objection that since no demand notice had been ,served on the Management, no indus trial dispute had legally come into existence, and as such the Reference was invalid and the Labour 334 Court had no jurisdiction to adjudicate it.
By an order, dated September 27, 1972, the Labour Court accepted the objection, holding: ". that no industrial dispute came into existence before this reference as the workmen have failed to establish serving of demand on the management prior to this reference.
The effect of this finding is that the reference could not have been made for adjudication and the same is accordingly invalid and hence the question of deciding the issue as in the reference or other issues does not arise as the industrial dispute under reference did not come into existence in accordance with law before this reference.
This award is made accordingly.
" Thereafter, the workmen on 25.10.1972, raised a dispute by serving demand notices on the Management.
By his order dated 2.5.1973, the Lt. Governor, Delhi, again made a Refer ence to the Labour Court, under the Act for adjudication of the same matter relating to the termination of the services of the aforesaid workmen.
The Management raised, inter alia, a preliminary objec tion that a second Reference within one year of the first `award ', dated September 27, 1972, was not competent in view of what is contained in sec.
19 of the Act.
By an order dated 2.5.1973, the Labour Court dismissed the preliminary objections.
After recording the evidence produced by the parties, the Court held on merits, that the termination of the services of 3 workmen was illegal and unjustified.
The Court further found that Bidhi Chand work man had become gainfully employed elsewhere as a driver with better emoluments and it was therefore sufficient to award him compensation without any relief of reinstatement, at the rate of 50% of his wages for three years from 1966 to 1969 to the date of his getting employment elsewhere.
It further found that Ram Sarup Gupta had remained unemployed after his dismissal in 1966.
It therefore directed his reinstatement with full back wages and continuity of serv ice.
As regards H.S. Rawat, the Court found that he could not have remained unemployed throughout but was doing some work or the other for his living, may be with occasional spells.
The Court therefore held that Rawat was entitled to reinstatement and continuity of service with 50% back wages till the award Came into operation and he got his reinstate ment.
This award was made by the Labour Court on 1 5 1975.
The Management impugned this award by filing a writ petition under article 226 of the Constitution in the High Court of Delhi.
Only three contentions were canvassed by the Management at the preliminary heating before the High Court: (i) That the determination, dated 27.9.1972, by the Labour Court was an 'award ' as defined in section 2(b) of the Act, and in view of sub section
(3) of section 19, it had to be in operation for a period of one year.
It could be terminated only by a notice given under sub sections
(4) & (6) of section 19.
Since no such notice was given, the award continued to be in operation.
The second award, dated 1 5 1975, could not be validly made during the period, the 335 first award was in operation; (ii) The demand for reinstate ment was not made by the workmen till 1972 and the Labour Court was not justified in awarding them the relief of reinstatement together with compensation for back wages from 1966 onwards; (iii) The onus to show that the workmen had not obtained alternative employment, after their dismissal, was on the workmen and this onus has not been discharged.
On the other hand, the Labour Court wrongfully did not permit the Management to adduce additional evidence to show that the workmen had obtained alternative employment and, in consequence, were not entitled to back wages.
Regarding (i), the High Court held that since the `award ' dated 27.9.1972, was not one which imposed any continuing obligation on the parties, but had ended with its pronouncement, nothing in subsections (3) and (6) of sec.
19 was applicable to it.
As regards (ii), the High Court held that once the dismissal of the workmen was found illegal, it was inevita ble to award the compensation from the dates of dismissal till they found alternative employment or till the date of the award, as the case may be.
In regard to (iii), the High Court said that the ques tion of burden of proof as to who is to prove, whether the workmen did not get alternative employment for the period for which back wages have 'been awarded to them could arise only if no evidence was given by either party or if the evidence given by them was evenly balanced.
Neither of these circumstances was present before the Labour Court, and there was no good reason to disturb the finding of fact recorded by the Labour Court on this point.
The High Court thus rejected all the three contentions, and, in the result, dismissed the writ petition in limine, with a speaking order.
Hence this appeal.
Shri G.B. Pai has reagitated all the three points before us.
He assails the findings of the High Court, thereon.
Regarding point No. (i) Mr Pai 's argument is that the determination, dated 27.9.1972, also, was an `award ' within the second part of the definition of the term in a. 2(b) of the Act, inasmuch as it determined a question relating to an industrial dispute.
Emphasis has also been laid on the point that this `award ', dated 27.9.1972 was duly published by the Government under section 17(1) and had assumed finality under sub section
(2) of the same section.
This award dated 27.9.1972 proceeds the argument had to remain operative under sub section
(3) of section 19 for a period of one year from the date on which it became enforceable under section 17A i.e., a date one month after its publication.
It is submitted that no second Reference could be validly made by the Government during the period the first award remained operative, and since the second Reference, dated 2.5.1973 was made before the expiry of such period of the first award (which had not been terminated in the manner laid down in section 19), it was invalid and the consequential adjudication by the Labour Court on its basis, was null and void.
In this connection counsel has relied upon a 7 436SCI/77 336 judgment of this Court in Management of Bangalore Woollen, Cotton & Silk Mills Co. Ltd,.
vs The Workmen and ant.(1) wherein it was held that when there is a subsisting award binding on the parties, the Tribunal has no jurisdiction to consider the same points in a fresh reference.
In that case, the earlier award had not been terminated and the Reference was therefore held to be incompetent.
Reference has also been made to a single Bench Judgment of the Allaha bad High Court in Workmen of Swadeshi Cotton Mill, Co. Ltd. v Swadeshi Cotton Mills Co., Ltd., Kanpur and ors.
(2) As against this, Shri M.K. Ramamurthi maintains that the Labour Court 's order, dated May 1, 1972 was not an 'award ' within the definition of the term in s 2(b) inasmuch as it was not a determination, on merits, of any industrial dis pute or of any question relating to an industrial dispute.
In this connection reliance has been placed on a judgment of this Court in Civil Appeal No. 241 of 1964 (Technological Institute of Textiles vs Its Workmen and ors.(3).
Before dealing with the while to notice the relevant conten tions canvassed, it will be worthwhile to notice the rele vant statutory provisions.
The terms `award ' and `industrial dispute ' have been defined in the Act as follows: `Award ' means an interim or a final determination of any industrial dispute or of any question relating thereto by any Labour Court, Industrial Tribunal or National Indus trial Tribunal and includes an arbitration award made under section 10A".
[vide section 2 (b)].
"Industrial dispute" means "any dispute or difference between employers and employers, or between employers and workmen, or between workmen and workmen, which is connected with the employment or non employment or the terms of employment or with the conditions of la bour, of any person", [vide section 2 (k)].
Section 10 describes the matters which can be referred to Boards, Courts or Tribunals for adjudication.
Only clause (i) of subsection (1) is material for our purpose.
It provides; "Where the appropriate Government is of opin ion that any industrial dispute exists or is apprehended, it may at any time by order in writing (a). (b) . (c) refer the dispute or any matter appear ing to be connected with, or relevant to the dispute, if if relates to any (1) ; (2) 42 Indian Factories Journal p. 255.
(3) 337 matter specified in the Second Schedule to a Labour Court for adjudication".
Sub section (4) requires the Labour Court to confine its adjudication to those points of dispute and matters incidental thereto which the appropriate Government has referred to it for adjudication.
The material part of section 19 reads as under: "(1) . (2) . (3) An award shall, subject to the provi sions of this section remain in operation for a period of one year from the date on which the award becomes enforceable under section 17A; Provided that the appropriate Government may reduce the said period and fix such period as it thinks fit: "Provided further that the appropriate Govern ment may, before the expiry of the said peri od, extend the period of operation by any period not exceeding one year at a time as it thinks fit so, however, that the total period of operation of any award does not exceed three years from the date on which it came into operation.
(4) Where the appropriate.
Government, Whether of its own motion or on the application of any party bound by the award, considered that since the award was made, there has been a material change in the circumstances on which it was based, the appropriate Government may refer the award or a part of it to a Labour Court, if the award was that of a Labour Court or to a Tribunal, if the award was that of a Tribunal or of a National Tribunal for decision whether the period of operation should not, by reason of such change, be shortened and the decision of Labour Court or the Tribunal, as the case may be, on such reference shall be final.
(5) Nothing contained in sub section (3) shall apply to any award which by its nature, terms or other circumstances does not impose, after it has been given effect to, any continuing obligation on the parties bound by the award.
(6) Notwithstanding the expiry of the period of operation Under sub section (3), the award shall continue to be binding, on the parties until a period of two months has elapsed from the date on which notice is given by any party bound by the award to the other party or parties intimating its intention to terminate the award.
338 (7) No notice given under sub section (2) or sub section (6) shall have effect, unless it is given by a party representing the majority of persons bound by the settlement or award, as the case may be.
" There is no dispute that the order on the earlier Refer ence was made by the Labour Court on 27 9 1972, while the second Reference with the same terms of Reference to that Court was made by the Government on 2.5.1973, i.e., within one year of the earlier order.
It is common ground that the period of one year for which an award normally remains in operation under sub section
(3) was not reduced or curtailed by the Government under sec.
19 or under any other provision of the Act.
It is further admitted between the parties that no notice was given by any party of its intention to terminate the Order dated 27.9.1972.
The controversy with regard to the first point there fore narrows down into the issues whether the determination dated 27.9.1972, of the Labour Court was an award as defined in section 2(b) of the Act? The definition of award in section 2(b) falls in two parts.
The first part covers a determination, final or interim, of any industrial dispute.
The second part takes in a determi nation of any question relating to an industrial dispute.
But the basic postulate common to both the parts of the definition, is the existence of an industrial dispute, actual or apprehended.
The "determination" contemplated by the definition is of the industrial dispute or a question relating thereto, on merits.
It is to be noted further that Sec. 2, itself, expressly makes the definition subject to "anything repugnant in the subject or context".
We have therefore to consider this definition in the context of sec.
19 and other related provisions of the Act.
Mr. Pai concedes that the order dated 27.9.1972, is not a determination of any industrial dispute, as such, falling under the first part of the definition.
However, Iris argument is that the expression any question relating there to" in the second part of the definition is of wide ampli tude and should be spaciously construed.
It is main tained that a question, whether or not an industrial dispute exists, will itself be a question relating to an industrial dispute within the tendment of the second part of the defi nition.
The contention appears to be attractive but does not stand a close examination.
Sub section (1) of sec.
10 indicates when and what matters can be referred to the Labour Court for adjudica tion.
The sub section expressly makes formation of opinion by the appropriate Government, that any industrial dispute exists or is apprehended" a condition precedent to the exercise of the power of making a Reference.
Subsection (4) gives a mandate to the Labour Court to confine its adjudication to those points of dispute which have been specified in the Order of Reference, or are incidental thereto.
From a conjoint reading of cl.(b) of section 2 and sub section (1) and (4) of sec.
10, it is 339 clear that in order to be an `award ' within the second part of the definition, a determination must be (i) an adjudica tion of a question or point relating to an industrial dis pute, which has been specified in the Order of Reference or is incidental thereto: and (ii) such adjudication must be one on merits.
Now let us test the Labour Court 's order, dated 27.9.72 in the light of the above enunciation.
That Order did not satisfy any of the criteria indicated above.
It did not determine the questions or points specified in the Govern ment Order of Reference.
Nor was it an adjudication on merits of any industrial dispute or a question relating thereto.
The only question determined by the Order, dated 27.9.1972, was about the existence of a preliminary fact, viz., existence of an industrial dispute which in the Labour Court 's opinion was a sine qua non for the validity of the Reference and the exercise of further jurisdiction by the Court.
Rightly or wrongly, the Court found that this preliminary jurisdictional fact did not exist, because "no industrial dispute had come into existence in accordance with law", and, in consequence, the Reference was invalid and the Court was not competent to enter upon the Reference and determine the matter referred to it.
With this find ing, the Court refused to go into the merits of the question referred to it.
There was no determination on merits of an industrial dispute or a question relating thereto.
We are therefore of opinion that Labour Court 's determination dated 27.9.1972, did not possess the attributes essential to bring it within the definition of an award.
The mere fact that this order was published by the Government under section 17(1) of the Act did not confer that status on it.
In the view we take we are fortified by the principle laid down by this Court in Technological Institute of Tex tiles vs Its Workmen (supra).
In that case, there was a settlement which in the absence of necessary formalities, was not binding on the parties.
Certain items of dispute were not pressed and withdrawn under the terms of such settlement.
In the subsequent reference before the Indus trial Tribunal some of the items of dispute were withdrawn and no award was made in respect thereto.
Thereafter, these items were again referred for adjudication along with cer tain other matters to the Tribunal.
It was contended on behalf of the Management that subsequent reference with regard to the items which had been withdrawn and not pressed in the earlier reference, was barred under sec.
19, because the earlier award had not been terminated in full.
Ramaswa mi J., speaking for the Court, repelled this contention, with these observations: "It is manifest in the present case that there has been no adjudication on merits by the industrial tribunal in the previous reference with regard to the matters covered by items (1) and (3) of the present reference, because the workmen had withdrawn those mat ters from the purview of the dispute.
There was also no settlement in exhibit R. 4, because the demands in question had been withdrawn by the workmen and there was no agreement between the parties 340 in regard thereto.
Our conclusion, therefore, is that the bar of section 19 of the does not operate with regard to the matters covered by items (1) and (3) of the present reference and the argument put forward by the appellant on this aspect of the case must be rejected." Although the facts of the case before us are different, yet the principle enunciated therein viz., that the bar of sec.
19 operates only with regard to a determination made on merits, is fully applicable.
By any reckoning, the decision dated 27.9.1972 of the Labour Court by its very nature did not impose any continuing obligation on the parties bound by it.
This was an additional reason for holding that the earlier reference was not barred by anything contained in sub section (3) or other provisions of section 19.
We have gone through the single Bench decision of the Allahabad High Court in Workmen of Swadeshi Cotton Mills Co. Ltd. case (supra).
That decision is to the effect that the finding recorded by the Labour Court that the matter re ferred to it for adjudication was not an industrial dispute as defined in the Act is itself a determination of a ques tion relating to an industrial dispute, and would fall within the definition of the term "award" under the Act.
In our opinion.
this is not a correct statement of the law on the point.
The next submission of Mr. Pai is that since the demand for reinstatement was not duly made by the workmen before 28.10.
1972, the Courts below were not justified in award ing to the workmen, compensation for back wages from 1966 onwards.
On the other hand, Mr. Ramamurthi maintains that such a claim was presumably agitated by the workmen in proceedings before the Conciliation Officer, in 1966.
While conceding that technically, no demand notice for reinstatement was served by the workmen on the Management before 25.10.
1972, Counsel submits that the Management were aware of the work men 's claim to reinstatement, since 1966, and in these circumstances, the Management should not be allowed to take shelter behind this technical flaw, and deny just compensa tion to them from the date of wrongful dismissal.
We have carefully considered the contentions advanced on both sides.
After taking into consideration all the circum stances of the case, we are of opinion that the Labour Court was not justified in awarding compensation to the workmen, for wages relating to the period prior to 25.10.1972 i.e., the date on which the demand notices for reinstatement were served on the Management.
To this ex tent, we would accept the contention of the appellants.
341 The third contention of the appellants is that the onus of proving that they had not obtained alternative employment elsewhere after the termination of their services, was on the workmen, and they had failed to discharge that onus.
We find no merit in this contention.
The question of onus oft loses its importance when both the parties adduce whatever evidence they had to produce.
In the instant case, both the parties led their evidence and closed their respective cases.
Subsequently, at a late stage, the Management made an application for adducing additional evidence.
The Labour Court declined theft appli cation.
The High Court found and we think rightly, no good reason to interfere with the discretion of the Labour Court.
It may be remembered further, that this appeal arises out of a petition under article 226 of the Constitution, and in the exercise of that special jurisdiction, the High Court does not reopen a finding of fact based on legal evidence.
The findings of the Labour Court to the effect, that after their dismissal, Ram Swamp Gupta was unable to find any alternative employment elsewhere, while Rawat was able to find only intermittent employment elsewhere, were based on evidence produced by the parties.
The High Court was there fore right in not interfering with those findings of fact.
Lastly it was urged by Mr. Pai, that the employers had lost confidence in the employees, and therefore, compensa tion, without reinstatement, would have been adequate re lief.
It is submitted that the business of the employers is that of Travel Agents and such a sensitive business can be successfully carried on only with the aid of employees whose fidelity and integrity is beyond doubt.
It is stressed that the employees of the appellants, have to handle daily lot of cash received from their clients in the discharge of their duties.
It is pointed out that the charge against H.S. Rawat was one of misappropriation of such funds and this charge was established in the domestic enquiry.
The Labour Court, proceeds the argument, did not displace that finding of the domestic Tribunal, but ignored it on the ground that the charge was stale and had been condoned.
In short, the argument is that the employers had lost confidence in this employee who could no longer be entrusted to perform sensitive jobs on behalf of the Management, without detriment to its business.
We are unable to accept this contention.
Firstly, this point was not argued before the High Court.
Secondly, the observations of the Labour Court, read as a whole, show that, in its opinion, the charge of misap propriation of funds had not been proved against H.S. Rawat.
This is what the Labour Court said on the point: "I am therefore of opinion that the charges had been condoned and they could not be revived again and the act of reviving the charge on account of his Union activities was an act of unfair labour practice on the part of the Management and amounted to victimisation.
Even the 342 charges in the charge sheet exhibit M/5 have not been established before me, that the workman withdrew the funds from the company on false pretences for revenue stamps and misappropri ated the same.
" Thus there is no factual basis for this belated conten tion, and we repel the same.
For the foregoing reasons, we dismiss this appeal with the modification that in addition to the relief of rein statement with continuity of service, S/Shri H.S. Rawat and Ram Swarup Gupta shall be entitled to 50%, and full back wages, respectively, from 25.10.1972.
It may be recalled that the special leave to appeal in this case, was granted on the condition that the appellants shall pay the costs of this appeal to the respondents, in any event.
We order accordingly.
P.B.R. Appeal dismissed.

dataset_name: IN-Abs

summary/full:
The term 'Award ' has been defined by section 2(b) of the to mean an interim or a final determination of any industrial dispute or of any question relating thereto by a Labour Court.
Section 10, which describes the matters that can be referred to a Labour Court etc.
for adjudication 'provides in sub s.(1) that where an appropriate government is of opinion that any industrial dispute exists or is apprehended it may, at any time, by order in writing. (c) refer the dispute or any matter appearing to be connected with or relevant to the dispute, if it relates to any matter specified in the second sched ule, to a Labour Court for adjudication.
Under section 19(3) an award shall remain in operation for a period of one year from the date on which the award becomes enforceable under section 17A. An industrial dispute relating to the dismissal of three workmen of the appellant had been referred to a Labour Court.
The Labour Court held that the reference was in valid because, as the workmen had not served demand notice on the management prior to the reference, no industrial dispute could legally come into existence before the refer ence.
After serving a demand notice on the management within a month thereafter the workmen raised an industrial dispute relating to the same matter.
The Labour Court rejected the employer 's preliminary objection that in view of section 19, the second reference was not competent in that it was made within one year of the first award, and decided the case on merits.
The Labour Court held that the termination of the services of the workmen was illegal and ordered reinstatement with back wages from the date of termination.
The employer 's writ petition under article 226 of the Constitution impugning the Labour Court 's decision was dismissed by the High Court.
Dismissing the appeal, HELD: The Labour Court 's determination in the first reference did not possess the attributes essential to bring it within the definition of an award.
The mere fact that this order was published by the Government under section 17(1), did not confer that status on it.
[339 D] 1(a) The definition of `award ' under section 2(b) falls in two parts (i) determination, final or interim, of any indus trial dispute and (ii) of any question relating to an indus trial dispute.
The basic postulate common to both the parts of the definition is the existence of an industrial dispute, actual or apprehended.
The `determination ' contemplated by the definition is of an industrial dispute or a question relating thereto on merits.
[338 D] (b) In the instant cases the order of the Labour Court in the first reference did not determine the question or points specified in government order of reference, nor was it an adjudication on merits of any industrial dispute or a question relating thereto.
The only question determined by the Labour Court was about the existence of an industrial dispute which in its opinion was a sine qua non for the validity of the reference.
Rightly or wrongly it found that this preliminary jurisdictional fact did not exist because no industrial dispute had come into existence in accordance with law and in consequence the reference was invalid.
There was, therefore, no determination of the dispute on merits on the question relating thereto.
[339 C D] 333 Technological Institute of Textiles vs Its Workmen and Ors. , followed.
Management of Bangalore Woollen, Cotton & Silk Mills Co. Ltd. vs The Workmen and Anr. ; , referred to.
Workmen of Swadeshi Cotton Mills Co. Ltd. vs Swadeshi Cotton Mills Co. Ltd. Kanpur and Ors.
42 Indian Factories Journal p. 255, not approved.
(b) Moreover the decision of the Labour Court in the first reference did not impose any continuing obligation on the parties bound by it.
The second reference was, there fore, not barred by anything contained in sub section (3 ) or other provisions of section 19.
[340 C] 2.
The Labour Court was not justified in awarding com pensation to the workmen for wages relating to the period prior to the date on which the demand notice for reinstate ment was served on the management.
[340 H]


judgement:
Civil Appeal No. 1037 of 1971.
(From the Judgment and Order dated the 17th June, 1971 of the Gujarat High Court in Special Civil Application No. 112/67).
V.P. Raman, Addl.
and Girish Chandra, for the appellants.
G.N. Dikshit and R.N. Dikshit, for the respondent.
The Judgment of the Court was delivered by GUPTA, J.
The respondent is a partnership firm manufac turing non woven felts from woollen fibres which are uti lised for the purpose of filtration in heavy industries.
Between August 25, 1965 and January 5.
1967 the Excise authorities compelled the respondent to pay Rs. 55,055/87 p. as excise duty on its products.
The respondent 473 filed a writ petition in the High Court of Gujarat at Ahme dabad for quashing the order levying excise duty on the felts manufactured by the respondent treating them as 'woo llen fabrics ' covered by entry 21 in Schedule I to the (hereinafter referred to as the Act).
The High Court allowed the writ petition holding that the respondents products were not 'woollen fabrics ' and directed refund of the sum of Rs. 55,055/87 p. collected as excise duty from the firm.
The Union of India has preferred this appeal on certificate of fitness granted by the High Court questioning the correctness of the deci sion.
The only question in the appeal is whether the felts manufactured by the respondent are "woolien fabrics" within the meaning of entry 21 in the first schedule to the Act.
The writ petition describes the process of manufacture and states that the thickness of the felts produced varies from 1 mm.
to 50 mms.
according to.
the specification of the customers and that these are really machine pressed raw woolwaste.
It is stated further that the felts manufactured .by the process described are neither sheets nor fabrics, they are not material from which garments could be prepared nor they could be used 'as covering or for similar other purposes.
Entry 21 in the first schedule to the Act reads: "21.
WOOLLEN FABRICS "Woollen fabrics" .means all varieties of fabrics manufactured wholly of wool or which contain 40 per cent, or more by weight of wool and includes blankets, lohis, rugs, shawls and embroidery in the piece, in strips or in motifs: Provided that in the case of embroidery in the piece, in strips or in motifs, the percentage referred to above shall be in relation to the base fabrics which are embroi dered _ (1) Woollen fabrics, other than Ten percent.
embroidery in the piece, in ad valorem.
strips or in motifs.
(2) Embroidery in the piece in The duty for strips or in motifs, in or in the time being relation to the manufacture leviable on the of which any process is ord base fabrics, inarily carried on with the if not already aid of power.
paid, plus twenty percent.
ad va 'orern Explanation " Base fabrics" means fab rics falling ' under sub item (1) of this Item which are subjected to the process of embroi dery.
" 0 Are the products of the respondent 's factory woollen fabrics ? Fabric means woven material.
The articles manu factured by the respondent, as already stated, are non woven felts from woollen fibres.
It is contended on behalf of the appellant, Union of India, 474 that in a technical sense the felts manufactured by the respondent would still be woollen fabrics.
The well known rule in interpreting items in statutes like the one we are concerned with is that "resort should be had not to the scientific or the technical meaning of such terms but to their popular meaning or the meaning attached to them by those dealing in them, that is to say, to their commercial sense".
(Commissioner of Sales Tax, Madhya Pradesh, Indore vs M/s. Jaswant Singh Charan Singh)(1).
The High Court has held that a trader dealing in woollen fabrics would not regard the respondent 's products as woollen fabrics, but it does not appear that there is any evidence on the record of the case to support the finding.
However, an inquiry re garding the meaning of the term woollen fabrics as commer cially understood would be relevant only when there is doubt as to the sense in which the term has been used in entry 21; it seems to us plain from the entry read as a whole that the respondent 's products did not fail within it.
Entries 19 to 22 in the schedule all deal with fabrics.
Entry 19 deals with cotton fabrics which is stated to cover, barring the exceptions specified, all varieties of fabrics manufactured either wholly or partly from cotton and in cludes, dhoties, sarees, chadders, bed sheets, bed spreads etc.
Entry 20 relates to slik fabrics which is said to mean all varieties of fabrics manufactured.
either wholly or partly from silk with certain exceptions and includes em broidery in the piece, in strips or in motifs.
Entry 22 relates to rayon or artificial silk fabrics which also is said to mean all varieties of fabrics manufactured either wholly or partly from rayon or artificial silk with some exceptions and includes embroidery in the piece, in strips or in motifs etc.
In this group, entry 21 describes woollen fabrics as meaning all varieties of fabrics manufactured out of wool, barring the exceptions mentioned, including blankets, lohis, rugs, shawls and embroidery in the piece, in strips or in motifs.
If the term 'woollen fabrics ' in this entry had been used in its technical or scientific sense and, if in that sense, it was wide enough to cover non woven material which is wool based, then it is diffi cult to explain why the entry should specifically mention blankets, rugs and shawIs as being included within it.
No one could possibly be in any doubt in respect of these few items if the term was so pervasive, and there was no reason for singling out these specific objects.
On the contrary, the mention of these items suggests that the word 'fab rics ' in entry 21 has been used to mean woven material in which sense it is popularly understood, and blankets, rugs and shawls etc.
have been specifically included in the entry out of abundant caution to indicate that 'woollen fabrics ' in entry 21 means not only woollen garments but also woollen material used as 'covering or for similar other purposes.
We therefore find no reason to take a view different from that taken by the High Court.
The appeal is dismissed with costs.
S.R. Appeal dismissed.

summary/full:
An excise duty of Rs. 55055.87 was levied and collected from the respondent firm by the Excise authorities treating the non woven felts manufactured by them as "woollen fab rics" covered by entry 21 in Schedule I to the .
The Gujarat High, Court allowed the writ petition filed by the respondent and held that the respondent 's products were not "woollen fabrics" and direct ed the refund of the entire sum collected as excise duty.
Dismissing the appeal by certificate to this Court, HELD: (1) The well known rule in interpreting items in statutes is that resort should be had not to the scientif ic or the technical meaning of such terms but to their popular meaning or the meaning attached to them by those dealing in them, that is to say, their commercial sense.
[474 A B] Commissioner of Sales Tax, Madhya Pradesh, Indore vs M/s. Jaswant Singh Charan Singh; , , applied.
(2) Fabric means woven material.
Entries 19 to 22 in the Schedule deal with fabrics.
Entry 21 describes woollen fabrics as meaning all varieties of fabrics manufactured out of wool, barring the exceptions mentioned, including blan kets, lohis, rugs, shawls and embroidery in the piece in strips or in motifs.
The word "fabric" in entry 21 has been used to mean woven material in which sense it is popularly understood.
The term "woollen fabrics" in that sense was not wide enough to cover non woven material which is wool based.
Blankets.
rugs and shawls etc.
have been specifical ly included in the entry out of abundant caution to indicate that "woollen fabrics" in entry 21 means not only woollen garments but also woollen material used as covering or for similar other purposes.
[473 H, 474 F G] (3) It is plain from entry 21 in Schedule 1 to the that the respondent 's products did not fall within it as they are nonwoven felts from woollen fibres.
[474 C]


judgement:
minal Appeal No. 343 of 1977.
(Appeal by Special Leave from the Judgment and Order dt.
21 10 75 of the Delhi High Court in Criminal Revision No. 118 of 1973).
A .K. Sen & A. K. Nag for the Appellant.
R. N. Sachthey & section P. Nayar for Respondent No. 1.
V. Prabha and section P. Nayar for Respondent No. 2.
The Judgment of the Court was delivered by FAZAL ALI, J.
This appeal by special leave is directed against the judgment of the High Court of Delhi dated 21st October, 1975 by which the High Court set aside the order of the Magistrate discharging the appellant and directed his commitment to the Court of Session.
The facts of the case have been detailed in the judgment of the High Court and that of the trial Court and it is not necessary for us to repeat the same all over again.
It will be enough to say that the complainant Pratap Bhanu Prakash Singh purchased 27,000 shares of Rohtas Industries which are entrusted to the appellant against a loan of Rs. 1.82 lacs advanced by the appellant.
Accordingly the allegation was made in the complaint that the appellant committed a breach of trust of the amount covered by the shares by selling them against express directions of the complainant.
The allegations were denied by the appellant who put forward a plea that there was no entrustment and that the shares were pi iced in the hands of the appellant as security and therefore the question of breach of trust did not arise.
In view of the allegations and counter allegations more by the parties, we are not inclined to go into the merits of the case particularly when we propose to uphold the order of the High Court directing commitment of the appellant to the Court of Session.
Any observations which may be made by us on merits are likely to prejudice either party at the trial and therefore we refrain from going into merits at this stage.
We are, however, satisfied that having regard to the reasons given by the High Court it cannot be said that the High Court was in error in exercising its discretion by setting aside the order of discharge and directing commitment to the Court of Session.
It appears that the appellant was tried by the trial Magistrate, who after entering into pros and con; of the case found that no prima facie case was established and he accordingly discharged the appellant by his order dated 28 10 1971.
"he complainant unsuccessfully filed a Revision against this order before the Sessions Judge, Delhi who affirmed the order of the Magistrate.
Ultimately the matter came up in revision before the High Court which after going through facts and circumstances of the case found that a prima facie case for commitment was made out and set aside the order of discharge passed 490 by the Magistrate and upheld by the Sessions Judge and directed that the appellant be committed to the Court of Session.
Hence this appeal by special leave before us.
Two points were argued by Mr. Ashoke Sen, the leaned counsel for the appellant.
In the first place, it was urged that having regard to the admitted facts and circumstances of the case no prima facie case against the accused was made out and the trial Magistrate was therefore justified in discharging the appellant and the High Court exceeded its jurisdiction in reversing the order of discharge and di recting commitment.
For the reasons that we have already given it is not possible for us to hold that the order of the High Court suffers High Court suffers from the infirmity pointed out.
The High Court has arrived at a finding of fact that a prima.facie case was made out for directing commitment to the Court of Session and this Court would not normally interfere with the discretion exercised by the High Court.
We would like to point out that under Sec.
213 sub cl.
(2) of the Code of Criminal Procedure, 1898 (hereinafter referred to as the "1898 Code") a Magistrate can discharge the accused if he finds that there are no sufficient grounds for committing the accused.
It is obvious that the High Court has applied its mind to the facts and circumstances of the case and it is not for this Court in appeal by special leave to go into the sufficiency or insufficiency of the, material before the Magistrate which may afford a justification for passing an order of discharge.
In these circumstances the first argument put forward by the learned counsel for the appellant is overruled and we refrain from saying anything more on this aspect.
The second argument of Mr. Ashoke was that even if the High Court was right in directing commitment, by setting aside the order of discharge the position will be that by virtue of a legal fiction, the commitment proceedings which culminated in the discharge of the appellant would revive so as to attract the operation of the Code of Criminal Procedure, 1973 (hereinafter referred to as the "1973 Code") as a result of which the case against the appellant would cease to be one which would be exclusively triable by the Sessions Court and therefore the Magistrate would be competent to try the, case himself under the 1973 Code.
In order to appreciate the argument advanced by the learned counsel for the appellant it may be necessary to extract the, relevant portion of the 1973 Code.
The relevant section 484 runs thus : "484(1) The Code of Criminal Procedure, 1898, is hereby repealed, (2) Notwithstanding such repeal, (a) if, immediately before the ate on which a& Code comes into force, there is any appeal application, trial, inquiry or investigation pending, then , such appeal, application, trial, inquiry or investigation shall be disposed of, continued, held or made, as the case may be, in accordance with the provisions of the C de of Criminal Procedure, 1898, as 'in force immediately before such commence 491 ment, (hereinafter referred to as the "Old Code '), as if this Code had not come into force : Provided that every inquiry under Chapter XVIII of the Old Code, which is pending at the commencement of this Code, shall be dealt with and disposed of in accordance with the provisions of this Code.
" The first part of this section clearly excludes the application of the 1973 Code to any appeal application, trial, inquiry etc.
pending at the time when the 1973 Code comes into force.
The provisio to sec.
484(1) & (2) however carves out an exception to the general rule contained in section 484(2) (a) and provides that where a commitment inquiry is pending at the commencement of the 1973 Code it is to be governed by the 1973 Code and not the 1898 Code.
It was thus argued that the moment the order of discharge passed by the Magistrate was set aside the commitment inquiry revived and would be deemed to be pending on the date on which the order of the High Court was passed that is to say 21 10 1975 and thereafter the inquiry would have to be regulated by the provisions of the 1973 Code.
It was argued that under the 1973 Code a case under section 409 is not exclusively triable by Sessions Court but is triable by a First Class Magistrate and therefore there would be no question of commitment of the case to the Court of Session but the Magistrate would have to try the case himself as he was competent to do so being a Magistrate of the First Class.
We have examined this argument carefully but we are unable to accede to the same.
The High Court has not passed any order to the effect that the commitment inquiry was to be revived but has, in absolutely clear and unequivocal terms, ordered "that the respondent 'shall stand committed to the Court of Session under sec.
409 ' view of the order passed by the High Court there is no question of any inquiry being received.
Moreover, it would appear from the perusal of sec.
437 of the 1898 Code that the revisional Court in hearing a revision against an order of discharge passed the Magistrate may direct Commitment without any in quiry at all or he may direct a fresh inquiry.
In this connection the relevant portion of section 437 of the .898 Code runs as follows : "When on examining the record of any case under section 435 or otherwise, the Sessions Judge or District Magistrate considers that such case is triable exclusively by the Court of Session and that an accused person has been improperly discharged by the inferior Court, the Sessions Judge or District Magistrate may cause him to be arrested, and may thereupon, instead of directing t fresh inquiry order him to be committed for trial upon tie matter of which he has been, in the opinion of the Sessions Judge or District Magistrate, improperly discharged".
It therefore, manifestly clear that there are two courses open to the revisional court (1) either to set aside the order of discharge and direct a fresh inquiry to be made under section 436 in which, 492 case the inquiry will automatically revive or (2) that instead of directing any fresh inquiry pass an order committing the accused for trial to the Court of Session.
An order of the, second category amounts to an order of commitment and there is no necessity of any further inquiry at all.
In the instant case as the High Court did not choose to order any further inquiry but directed that the accused will stand committed to the Court of Session the question of revival of the inquiry does not arise at all.
Indeed, if the High Court would have directed further inquiry into the matter then the matter would have gone back to the Magistrate and the original inquiry would have revived in terms of the order of the High Court.
In that case, no doubt, the 1973 Code may have applied.
In the instant case since by virtue of the order of the High Court the Magistrate had no control or siesin of the case at all the question of any inquiry pending before him does not arise.
For these reasons, therefore, we overrule the second contention put forward by Mr. Ashoke Sen.
The result is that the appeal fails and is dismissed.
As the case is old, the Sessions Court will give top priority to this case and dispose it of as early as possible in accordance with law.
section R. Appeal dismissed.

summary/full:
A complaint filed by respondent Pratap Bhanu Prakash Singh alleging that the appellant to whom he has entrusted the 27000 shares purchased by him from Rohtas Industries against a loan of Rs. 1.82 lacs advances by the latter, has committed a breach of trust of the amount covered by the shares by selling them against his express directions, was inquired into the trial magistrate and was dismissed later on 28 10 71.
The revision filed before the Sessions Judge Delhi failed.
In the further revision, the High Court set aside the order of discharge and directed that the appellant be committed to the Court of Sessions.
Dismissing the appeal by special leave, the Court HELD : 1.
it is not for the Supreme Court in appeal by special leave to go into the sufficiency or insufficiency of the material before the magistrate which may afford a justification for passing an order of discharge.
Under sec tion 213, sub clause (2) of the Crl.
Procedure.
Code, 1898, a magistrate can discharge the accused if he finds that there are no sufficient grounds for committing the accused.
[490 B D] 2.
Under section 437 of the Criminal Procedure Code 1898, the revisional Court in hearing a revision petition against an order of discharge passed by the magistrate may direct a commitment without any inquiry at all or he may direct a fresh inquiry.
There are two courses open to the revisional Court : (1) either to set aside the order of disc charge and direct a fresh inquiry to be made under Section 436 in which case, the inquiry will automatically revive or (2) that instead of directing any fresh inquiry an order committing the accused for trial to the Court of Sessions.
An order of the second category amounts to an order of commitment and there is no necessity of any further inquiry at all.
[491 E F, H, 492 A] 3.
The first part of Section 484 clearly excludes the application of 1973 code to any appeal, application, trial, inquiry etc.
pending at the time when the 1973 Code comes into force.
The provision to section 484 (1) (2) carves out an exception to the general rule contained in Section 484(2) (a) and provides that where a commitment inquiry is pending at the commencement of the 1973 Code, it is to be governed by 1973 Code and not by 1898 Code.
In the instant case, the High Court has not passed any order to the effect that the commitment inquiry was to be revived, but has in absolutely clear and unequivocal terms ordered, "the, respondent shall stand committed to the Court of Sessions u/s 409.
" Since by virtue of the High Court the magistrate had no control or siesin of the case at all,the of any inquiry pending before him does not arise.
[491 B, C,E 492 B C] 489


judgement:
il Appeals Nos. 22 and 22 A and 301 of 1955.
Appeals by special leave from the judgment and order dated the 4th July 1952 of the Labour Appellate Tribunal of India, Lucknow in Appeals Nos. 391 and 392 of 1951 arising out of the Award dated the 1st November 1951 of the Adjudicator and Additional Regional Conciliation Officer, Kanpur in Case No. 53 of 1951.
G.S. Pathak, (Rameshwar Nath and Rajinder Narain), for the appellants in all the appeals.
G. C. Mathur, for the respondent in C. A. Nos. 22 and 22 A and respondent No. 4 in C. A. No. 301 of 1955.
K. B. Asthana and C. P. Lal, for the respondent No. 3 in C. A. No. 301 of 1955.
December 23.
The Judgment of the Court was delivered by BOSE J.
We are concerned here with three appeals.
They arise out of a dispute between the J.K. Iron and Steel Company Limited and the Iron and Steel Mazdoor Union.
We will call them the 1317 Company and the Mazdoor Union respectively.
The facts are as follows.
The Company had its factory and other works at Kanpur in Uttar Pradesh.
On 10 4 1948 the Ministry of Commerce in the Government of India ordered the Company to shift its Jute Baling Hoops factory from Kanpur to Calcutta.
As no land was available in Calcutta no effect could be given to this order till the year 1950 51.
On 19 3 1951 the Iron and Steel Controller ordered the Company to stop the rolling of jute baling hoops at once.
Accordingly, the production of these hoops was stopped from that date.
At the same time there was scarcity of scrap iron and the Company 's case is that forced it to reduce the working of its furnace from three shifts a day to one.
The Company states that because of these two causes it was obliged to retrench its staff.
Therefore, it issued the following notice dated 15 5 1951 to 128 of its workers: "Consequent to transfer of the Rolling Mill to Calcutta and want of scrap to Furnace Department in full, the services of the persons as per list attached are dispensed with from today.
Their wages and other dues in full settlement will be paid after 2 P.m.
" Twenty five of the 128 accepted their wages and other dues in full settlement but the remaining 103 refused.
Their cause was accordingly espoused by the Mazdoor Union which made an application to the Regional Conciliation Officer at Kanpur on 16 5 1951 complaining that the retrenchment was illegal and asking that the workmen be reinstated with full payment of their wages for the period they were out of work.
This was forwarded to the Government of Uttar Pradesh and on 28 6 1951 the Governor of that State referred the following issue to the Regional Conciliation Officer at Kanpur under sections 3, 4 and 8 of the U.P. for adjudication: "Whether the retrenchment of the workmen 1318 given in the Annexure by Messrs J. K. Iron and Steel Co. Ltd ' Kanpur, is unjustified? If so, to what relief are the workmen entitled?" The parties filed their written statements on 14 7 1951 and the Company filed a rejoinder on 20 7 1951.
The Adjudicator thereupon took evidence, oral and documentary, and gave his award on 1 11 1951.
But before that was done the case of one of the workmen (Kapil Deo Singh) was withdrawn and that left 102 for him to deal with.
The Adjudicator reached the following conclusions.
The Mazdoor Union had contended that the retrenchment was not in good faith.
The Adjudicator held that it was and that there was neither harassment nor victimisation.
So also on the question about the shortage of scrap he held that there was a shortage but that it was only temporary and that it was not likely to last for more than 8 or 9 months.
He then referred to the Standing Orders and said that the Company was not entitled to resort to retrenchment except as a last resort and that in the circumstances of the present case these workmen should (1) have been offered the option of employment in the new set up at Calcutta; and (2) those that did not want it should have been laid off in rotation instead of being retrenched.
He accordingly ordered that should be done and drew up a graduated scale ,of compensation.
We observe in passing that the expression used throughout has been "played off".
The reason for that is that is the phrase used in the Standing Orders and in the copy of the Act and Model Standing Orders reproduced by the U. P. De partment of Labour in its Annual Review of Activities.
But it seems to us that was due to printer 's error at some stage which has been repeated in various places.
The correct expression is "lay off".
That is the expression used and defined in the Act.
The Standing Orders should have used the same phrase.
Apart from the definition in the Act, "lay off " is a well known industrial term meaning, according to the Oxford Dictionary, "a period during which 1319 a workman is temporarily discharged".
We will use the correct expression in this judgment.
Both sides appealed to the Labour Appellate Tribunal.
The decision, there was as follows.
The Tribunal upheld the finding that there was in fact a shortage of scrap iron and also agreed with the Adjudicator that was only likely to be temporary.
Then it held, apparently as a matter of law, that under the Standing Orders it is not permissible to retrench workmen and deprive them of their maintenance when there is only a temporary shortage of material, whatever the duration of the shortage; all that the employer can do in a case like that is to lay them off.
The Tribunal also upheld the finding that the Hoop Mill was in the course of transfer to Calcutta consequent on the orders of Government, but they held that there was nothing on the record to show which of the 105 persons (it should be 102) whose cases they were considering were "specifically engaged in the Hoop Mills and had become surplus by reason of the transfer to Calcutta".
This is one of the findings attacked before us by the Company on the ground that the Tribunal has failed to realize that the Company 's operations must be considered as a whole and that because of the interdependence of its various departments a closure of one section, coupled with a shortage of materials in another, is bound to affect its all round working and therefore the question of retrenchment cannot be looked at from the narrow point of view of only one department but must be viewed in its all round setting.
We will deal with this later.
Another of the Tribunal 's findings on the "transfer" aspect of the case was that a cut in profits is not in itself a good ground for retrenchment.
It held that retrenchment can only be made when there is a total closure of the mill "or when for any such other reason the workmen become surplus".
The final conclusion of the Tribunal was that the retrenchment was "wholly unjustified".
Accordingly, it set aside the retrenchments and held that the 1320 affected workmen will be deemed to be "still in service".
and directed that they be reinstated.
The appeal of the Mazdoor Union was partly allowed and that of the Company dismissed.
This impelled the Company.
to do the following things: (1)to file a writ petition in the Allahabad High Court on 4 8 1952.
This was dismissed by that Court on 9 4 1953 and Civil Appeal No. 301 of 1955 is the appeal to us against that order; (2)to file two appeals to this Court against the order of the Labour Appellate Tribunal.
These appeals are Civil Appeal No. 22 of 1955 and Civil Appeal No. 22 A of 1955.
This judgment covers all three appeals.
Mr. G. C. Mathur, who appeared for the Mazdoor Union, raised a preliminary objection against the Company 's appeals based on the following facts.
The Company had appealed to this Court against the Labour Appellate Tribunal 's decision on 26 8 1952.
The petition was summarily dismissed on 10 9 1952.
Counsel contended that barred the present appeals: Civil Appeal 22 A of 1955 because it is an appeal against the very order that is now under appeal, and Civil Appeal 301 of 1955 on the basis of res judicata because it raises the same points as were raised in the petition for special leave which was dismissed.
We rejected this objection because the previous petition for appeal does not appear to have been dismissed on the merits but on two technical grounds.
It is true the order of dismissal is general but the office note states (1) that no certified copy of the decision appealed against was filed though Order 13, rule 4, of the Rules of the Supreme Court, requires that and (2) that the reliefs sought in the petition for special leave and in the writ petition before the High Court are the same.
It is evident that formed the basis of the order of dismissal especially as it is the usual practice not to entertain an appeal here when a similar matter is pending in the High Court, 1321 Before we come to the merits it will be necessary to set out the grounds on which the High Court proceeded.
The learned Judges were concerned with a writ for certiorari and so naturally focussed their attention on questions of jurisdiction rather than on the merits.
They considered that the Adjudicator ' was free to take into consideration all matters bearing on the question of retrenchment and to consider whether it was "absolutely necessary" to retrench the workmen.
They looked at Standing Order 16(a) and decided that the Adjudicator had jurisdiction to determine the scope and meaning of this Order and that he and the Labour Appellate Tribunal were competent to hold that these orders meant that the Company was not entitled to take what the learned Judges called the "extreme step of retrenchment" so long as it was possible for it to "lay off " the workmen.
That at once raises questions about the scope and authority of an adjudicator under the .
But that, we feel is now settled by authority.
The Federal Court held in Western India Automobile Association vs Industrial Tribunal, Bombay(1) that adjudication does not mean adjudication according to the strict law of master and servant and held that an adjudicator 's award may contain provisions for settlement of a dispute which no Court could order if it was bound by ordinary law.
They held that Industrial Tribunals are not fettered by these limitations and held further that an adjudicator has jurisdiction to investigate disputes about discharge and dismissal and, where necessary, to direct reinstatement.
That decision was followed with approval by this Court in State of Madras vs C. P. Sarathy(2) and it was again pointed out that the scope of an adjudication under the is much wider than that of an arbitrator making an award.
It would be pointless to cover the same ground; so we must take that now as settled law.
All the same, wide as their powers are, these Tri (1) , 345.
(2) , 348, 1322 bunals are not absolute and there are limitations to the ambit of their authority.
In Bharat Bank Ltd. vs Employees of Bharat Bank Ltd.(1) this Court held by a majority that though these Tribunals are not Courts in the strict sense of the term they have to discharge quasi judicial functions and as such are subject to the overriding Jurisdiction of this Court under article 136 of the Constitution.
Their powers are derived from the statute that creates them and they have to function within the limits imposed there and to act according to its provisions.
Those provisions invest them with many of the "trappings" of a court and deprive them of arbitrary or absolute discretion and power.
There is, in our opinion, an even deeper reason which is hinted at in the judgment of Mahajan J. (as he then was) at page 500 where he says that "benevolent despotism is foreign to a democratic Constitution".
That, in our opinion, is the heart of the matter.
When the Constitution of India converted this country into a great sovereign, democratic, republic, it did not invest it with the mere trappings of democracy and leave it with merely its outward forms of behaviour but invested it with the real thing, the true kernel of which is the ultimate authority of the Courts to restrain all exercise of absolute and arbitrary power, not only by the executive and by officials and lesser tribunals but also by the legislatures and even by Parliament itself.
The Constitution established a "Rule of Law" in this land and that carries with it restraints and restrictions that are foreign to despotic power.
Despite this, however, the Courts must always exercise caution and see that they do not substitute their own judgment and discretion for that of these Tribunals, for, as Mahajan, J. said in Bharat Bank Ltd. vs Employees of Bharat Bank Ltd.(1) the overriding powers of this Court under article 136 are exceptional; and he went on to point out that "extraordinary Powers of this character can only be justifiably used here there has been a grave miscarriage of justice or where the procedure adopted by (1) ; , 497.
1323 the Tribunal is such that it offends against all notions of legal procedure".
Now the position in the present case is this.
The Tribunals are directed by section 7 of the to adjudicate industrial disputes "in accordance with the provisions of the Act" and section 11 directs them to follow "such procedure as may be prescribed".
The procedure for the Uttar Pradesh Tribunals is laid down by the U.P. State Industrial Tribunal Standing Orders, 1951.
Very broadly it follows the pattern of the civil Courts.
Once the reference is made by Government, the Tribunal has to take the pleadings of the parties in writing and to draw up issues.
Then it takes evidence, hears arguments and finally pronounces its "judgment" "in open Court".
It is evident from this that though these tribunals are not bound by all the technicalities of civil Courts, they must nevertheless follow the same general pattern.
Now the only point of requiring pleadings and issues is to ascertain the real dis pute between the parties, to narrow the area of conflict and to see just where the two sides differ.
It is not open to the Tribunals to fly off at a tangent and, disregarding the pleadings, to reach any conclusions that they think are just and proper.
What exactly was the dispute in the present case? The broad conflict was of course about the retrenchment and the Tribunal was asked to decide whether the retrenchment of these 103 persons was unjustified; but that by itself left the issue much too broad, so it was necessary to "particularise" and that was done in the pleadings.
The Company justified its action on two grounds: (1) because of the shortage of scrap and (2) because of the stoppage of work in the Hoop Department consequent on the orders of Government.
But none of the persons retrenched came from the Hoop Department and the Company explained that was because of the interdependence of its various departments and, taking the retrenchments in groups, department by department, it explained just why reduction was effected in those particular places.
In 167 1324 this way, it dealt serially with the retrenchments in(1) the Scrap Department, (2) the Cast Iron Foundry,(3) the Punching and Pressing Department, (4) the Watch and Ward Department and (5) the Clerical Department.
The Company also made the following assertions, (1) that retrenchment is a necessary incidence of an industry and that the discretion of the management should not be interfered with; (2) that it is the exclusive function of the management to determine the size of its working force and (3) that the employer must be the sole judge as to how economically or efficiently its business is to be run.
The Mazdoor Union retorted that the retrenchments were not done in good faith.
It denied that there was any shortage of scrap but admitted the interdependence of the various departments and used that fact as an argument to indicate the Company 's bad faith.
The Union said the very fact that there had been no retrenchment in the department that was directly affected, namely the Hooping Department, and that there was no retrenchment in certain allied departments that would have been the first to be bit, had there been any real shortage of scrap, showed that the reasons given by the Company for the retrenchment were untrue.
In particular, the Union pointed out that there had been no retrenchment in the following departments which, according to it, would have been the hardest hit had there been any truth in the Company 's case namely, (1) the Furnace Department, (2) Rolling Mill Department, (3) Workshop, (4) Painting and Bundling, (5) Works and Maintenance.
Then, as regards the Foundry Department and the Scrap Department where there bad been retrenchments, the Union said that these departments bad sub sections and yet there were no retrenchments in the sub sections that would have been hit if the Company 's allegations were true.
The Union gave no reply to the Company 's assertions about its right to retrench in the absence of bad faith , its right to determine the size of its work 1325 ing force and its right to judge of the economy and efficiency of its business.
The Company filed a written rejoinder and explained in detail why there had been no retrenchments in the places where, according to the Union, there should have been on the facts alleged by the Company and it again explained why it had retrenched workers in the departments which, according to the Union, ought to have been the hardest hit.
This explanation again brought out the interdependence of the various departments.
Instead of drawing up issues, as it is required to do by Standing Order 22 of 1951, and determining just where the parties disagreed, the Adjudicator at once proceeded to record evidence and entered upon a rambling enquiry which embraced questions which had not been raised at all.
On the only point on which the parties were really at issue, namely the good faith of the management, the findings were in favour of the Company.
So also the Adjudicator accepted the Company 's assertion about its right to determine the size of its labour force and to effect retrenchment where necessary subject only to the proviso which the Adjudicator added, namely that this must be done in good faith; and indeed the Mazdoor Union had not challenged these assertions in its written statement.
The Adjudicator said "It is however an accepted principle that such changes as are being done by the management now form a part of managerial discretion and cannot be interfered with unless it is coloured with the element of victimisation or unfair labour practice".
But despite this, and despite his findings about good faith, the Adjudicator considered that, in spite of it all "the right of the workmen has to be safeguarded to certain extent".
What is left of the right if the "accepted principle" be what he says it is and if there is no victimisation or bad faith, he did not proceed to explain.
If the principle he enunciated and accepted is sound, then the only rights they have are to complain of 1326 bad faith, victimisation and so forth.
However, feeling under a compulsion to safeguard these unexplained rights he had recourse to Standing Order 16(a) and ignored Standing Orders 19 and 20.
The "accepted principle" to which the Adjudicator refers in the passage quoted above is implicit in Standing Orders 19(a) and 20(a).
They deal with the termination of service by an industrial establishment and prescribe a certain quantum of notice in writing, and then comes this important proviso in Standing Order 19 (a) "Provided that if a permanent workman feels that he has been discharged for reasons not connected with his employment or that the reason of discharge communicated to him is not genuine, he may make an appeal to the Labour Commissioner.
The decision of the Labour Commissioner. . . shall be binding on both the parties".
Reading the body of Standing Order 19 (a) along with the proviso in the light of the "accepted principle", it is evident that the only right the workman has, when his services are lawfully terminated after service of due notice and so forth, is to question the order on only two grounds (1)that he has been discharged for reasons not connected with his employment, and (2)that the reason of discharge communicated to him is not genuine.
There is nothing in these Standing Orders to indicate that retrenchment is a measure of last resort and that an employer must continue to lay off his workmen however uneconomical that may be to the business; still less that he must lay them off in rotation and thus affect other workmen who would not be affected by a legitimate order of retrenchment.
That cuts at the root of the "accepted principle".
In any event, the ground on which the adjudicator proceeded was not a matter in dispute between the parties because it was not raised in their pleadings and could not have been put in issue bad the Adjudicator troubled to draw up issues as he should have done.
As Mahajan, J. said, adjudicators and tribu 1327 nals cannot act as benevolent despots and that is exactly what it comes to when an adjudicator, after setting out, correctly in our opinion the Company 's rights, holds against the Union on the only grounds that it did raise and then proceeds to give an award, not only on grounds that are not raised but on grounds that fly in the face of the very principles that he enunciated; and that only because he felt that he was under a compulsion to "safeguard" the workmen to "a certain extent".
Both sides appealed to the Labour Appellate Tribunal and the second ground of the appeal lodged, by the Mazdoor Union was "that the award of the learned Adjudicator is quite arbitrary" which, of course, is exactly what it was And so also ground No. 9: "That the learned Adjudicator has gone beyond his jurisdiction in awarding relief on a question not, referred to it by Government".
That again we feel is justified.
What was referred was the question of the justification for retrenchment of certain specified workmen.
What was awarded was the laying off of persons whose cases were not even considered, that is to say, when the Adjudicator directed laying off in rotation, his order necessarily affected persons who had neither been laid off nor retrenched and whose cases not even the Union had in mind.
It is to be observed that the Mazdoor Union complains about this part of the order in ground No. 11 though on a different ground.
The Company also appealed against the Adjudicator 's order and grounds Nos. 6, 9 and 24 of their appeal are directed against that part of the order that deals with the lay off of the workmen.
Among other reasons advanced is that this will adversely affect others who are not retrenched.
The other grounds repeat what was said in the company 's written statement though in different language.
The Labour Appellate Tribunal contrasted Standing Order 15(a) with Standing Order 16(a) but also ignored Standing Orders 19(a) and 20 which are the 1328 only ones that really apply to this case.
It upheld the finding of the Adjudicator that there was a shortage of scrap but held that as the shortage was for only 6 months retrenchment was not justified.
In point of fact, the Labour Appellate Tribunal is wrong about the six months.
It was under the impression that the Adjudicator had come to that conclusion.
But what the Adjudicator said was that the shortage at best was for a period of 8 or 9 months.
The passage which the Appellate Tribunal quotes is not the finding of the Adjudicator but the argument advanced on behalf of the Company.
The full passage runs thus: "Shri Mahalingam stated that Standing order 16(a) which provides for a lay off of a maximum period of 12 days in a month contemplates a temporary shortage of very short duration.
It could not apply to shortage of raw materials lasting for more than 6 months and hence the Company 's right to retrench is not affected by the aforesaid Standing Order".
The Appellate Tribunal quoted the portion we have underlined but ignored the rest of the sentence and the part that went before and concluded that the portion underlined was a part of the Adjudicator 's findings.
However, even if we assume that the Tribunal would have reached the same conclusion if it had realised that the shortage was for as long as 8 or 9 months, the error into which it has fallen is that the question of retrenchment cannot be made to depend on the duration of the shortage or even on the fact that those retrenched will be thrown out of employment but on the effect that an omission to retrench will have on the business.
In some cases, laying off even for 6 or 8 or 9 months might make the Company bankrupt, therefore, if the Appellate Tribunal considered that it had power to stop retrenchment for reasons other than those given in the proviso to Standing Order 19(a) it was bound to look into the Company 's finances and determine the question of justification on that basis.
The only question referred was the retrenchment justified? and we find it 1329 impossible to see how that can be determined without considering the question of good faith which in turn would largely depend on the finances of the Company, on the adverse effect that retention would have on the business and on whether retention would mean the deadweight of an uneconomic surplus and so forth.
Next, when the Appellate Tribunal turned its attention to the transfer of the Hoop Mill to Calcutta, it agreed that would have been a good ground for retrenching those who were specifically engaged in the Hoop Mill but not the others.
But this takes an impossibly narrow view and ignores the over all working of a business concern and the repercussions that a transfer of this kind would have on other parts of the business.
It totally ignores the pleadings of the parties and, like the adjudicator, bases its conclusion on some airy view of what it considers would be a good thing for the workmen.
That is not a decision "given in accordance with the Act" and is as much open to objection on that score as the award of the Adjudicator.
It is pertinent at this stage to refer to a decision of this Court reported in Muir Mills Co. vs Suti Mills Mazdoor Union, Kanpur(1) where Bhagwati, J. delivering the judgment of the Court said "The considerations of social justice imported by the Labour Appellate Tribunal in arriving at the decision in favour of the respondent were not only irrelevant but untenable".
In the present case also we are of opinion that the Adjudicator and the Labour Appellate Tribunal had adopted the attitude of benevolent despots and have based their conclusions on irrelevant considerations and have ignored the real questions that arose for decision and the issues that arose out of the pleadings of the parties.
It would not be right for us to substitute our judgment and discretion for that of the Adjudicator and the Tribunal: accordingly, as we are of opinion that the.
real questions that were in dispute between the (1) ; , 1001.
1330 parties were neither appreciated nor considered we have no alternative but to remit the matter to the Labour Appellate Tribunal for a proper decision after drawing up issues that arise out of the pleadingS, considering them and deciding the dispute accordingly, with liberty of course to remit the case to the Adjudicator for a retrial or for the taking of further evidence if it is of the opinion that the omission to draw up issues and focus attention on the points that seem to be in dispute has had the result of shutting out evidence that might otherwise have been led.
An agreement said to have been reached between the parties on 7 9 1953 was placed before us towards the end of the arguments but we have not looked at it because counsel for the Mazdoor Union said it did not cover the case of these retrenched workers.
The Company insisted that it did.
We were not prepared to investigate that dispute at that late stage but we make it plain that the Labour Appellate Tribunal will be at liberty to consider it or not as it deems right after hearing what both sides have to say about it.
The award and the decision of the Labour Appellate Tribunal are set aside and the case is remitted to the Labour Appellate Tribunal for a re bearing of the appeals filed before it and for a fresh decision in the light of the foregoing observations.
We will, however, have to make some interim arrangement for payment of what may be termed a sort of subsistence allowance to the affected workmen during the pendency of those further proceedings.
As there is no agreement between the parties on the subject, we leave it to the Labour Appellate Tribunal or the Adjudicator, as the case may be, to make suitable orders in this respect.
There will be no order, about costs as neither party is to blame for what has happened.

summary/full:
Held, that adjudication by an adjudicator under the does not mean adjudication according to the strict law of master and servant and that an adjudicator 's award may contain provisions for the settlement of a dispute which no court could order if it was bound by ordinary law.
Thus the scope of an adjudication under the is much wider than that of an arbitrator making an award.
Industrial Tribunals are not fettered by such limitations and an adjudicator has jurisdiction to investigate disputes about discharge and dismissal and where necessary, to direct reinstatement.
Nevertheless, wide as their powers are, these Tribunals are not absolute and there are limitations to the ambit of their authority.
Though they are not courts in the strict sense of the term, they have to discharge quasi judicial functions and as such are subject to the overriding jurisdiction of the Supreme Court under article 136 of the Constitution.
Their powers are derived from the statute that creates them and they have to function within the limits imposed there and to act according to its provisions.
Those provisions invest them with many of the trappings" of a court and deprive them of arbitrary or absolute discretion and power.
Benevolent despotism is foreign to a democratic Constitution.
When the Constitution of India converted this country into a sovereign, democratic, republic, it did not invest it with the mere trappings of democracy but invested it, with the real thing, the true kernel of which is the ultimate authority of the courts to restrain all exercise of absolute and arbitrary power not only by the executive and by officials and lesser tribunals but also by the legislatures and even by Parliament itself.
The Constitution established a "Rule of Law" in this land and that carries with it restraints and restrictions that are foreign to despotic power.
The courts, however, must always exercise caution and should not substitute their own judgment and discretion for that of such tribunals.
166 1316 In view of sections 7 and 11 of the and U.P. State Industrial Tribunal Standing Orders 1951 these Tribunals, though not bound by all the technicalities of Civil Courts must nevertheless follow the general pattern of the Civil Courts in the matter of taking the pleadings of the parties in writing and the drawing up of issues.
It is not open to the Tribunals to disregard the pleadings and to reach any conclusion that they think are just and proper.
The Supreme Court remitted the case to the Labour Appellate Tribunal for a rehearing of the appeals as the Adjudicator and the Labour Appellate Tribunal had adopted the attitude of benevolent despots and had based their conclusion on irrelevant considerations and ignored the real questions that arose for decision and the issues that arose out of the pleadings of the parties.
Western India Automobile Association vs Industrial Tribunal, Bombay ([1949] F.C.R. 321, 345), State of Madras vs C. P. Sarathy, ([1953] S.C.R. 334, 348), Bharat Bank Ltd. vs Employees of Bharat Bank Ltd., ([1950] S.C.R. 459, 497), Muir Mills Co. vs Suti Mills Mazdoor Union, Kanpur ([1955] 1 S.C.R. 991, 1001), referred to.


judgement:
minal Appeal No. 568 of 1976.
(From the Order dt. 2 4 1975 of the Punjab and Haryana High, Court at Chandigarh in Criminal Original No. 15/Crl.11975).
Mohan Behari Lal for the Appellant.
Hardev Singh, Sunada Bhandare and Mohini for the Respondents Nos.
1 2. 511 section M. Kacker, Sol.
Genl. & R. N. Sachthey for Respondent No. 3.
The Judgment of the Court was delivered by UNTWALIA, J.
This is an appeal filed by the alleged contemner under section 19(1) of the (hereinafter called the Act), from the order dated 2nd April, 1975 of the High Court of Punjab and Haryana directing the issue of notice to the appellant to show cause why he should not be proceeded against for committing con tempt of the High Court.
The Notice was issued in accordance with the procedure prescribed under section 17 of the Act, to show cause against the appellant 's alleged liability to be punished under section 15.
A preliminary objection was raised by the, Learned Solicitor General,, on behalf of the respondents that no appeal lies to this Court under section 19 of the Act from an order issuing notice as nothing yet has been decided by the High Court.
Mr. Mohan Behari Lai, learned counsel for the appellant combated this argument and submitted that an appeal does lie to this Court as a matter of right under section 19.
In our opinion, the preliminary objection raised on behalf of the, respondents is well founded and must be accepted as correct.
section 19(1) says .lm15
An appeal shall lie as of right from any order or decision of the High Court in the exercise of its jurisdiction to punish for contempt (a) where the order or decision is that of a single judge, to a Bench of not less than two Judges of the Court; (b) where the order or decision is that of a Bench, to the Supreme Court : Provided that where the order or decision is that of the Court of the Judicial Commissioner in any Union territory, such appeal shall lie to the Supreme Court.
" It would appear from a plain reading of the section that an appeal shall lie to this Court as a matter of right from any order or decision of a bench of the High Court if the order has been made in the exercise of its jurisdiction to punish for contempt.
No appeal can lie as a matter of right from any kind of order made by the High Court in the proceeding for contempt: The proceeding is initiated under section 17 by issuance of a notice.
Thereafter, there may be many interlocutory orders passed in the said proceeding by the High Court.
It could not be the intention of the legislature to provide for an appeal to this Court as a matter of right from each and every such order made by the High Court.
The order or the decision must be such that it decides some bone of contention raised before the High Court affecting the right of the party aggrieved.
Mere initiation of a proceeding for contempt by the issuance, of the notice on the prima facie view that the case is a fit one for drawing up the proceeding, does not decide any question.
This Court, 512 for the first time, cannot be asked in such an appeal to decide whether the; person proceeded against has committed contempt of the High Court or not.
The matter has to be decided either finally or, may be.
even at an earlier stage an order is made, which does decide a contention raised by the alleged contemner asking the, High Court to drop the, proceeding.
It is neither possible, nor advisable, to make an exhaustive list of the: typo of orders which may be appealable to this Court under section 19.
A final order, surely, will be appealable.
Our attention was drawn by Mr. Mohan Behari Lai, to section 20 of the Act which provides "No Court shall initiate any proceedings for contempt, either on its own motion or otherwise, after the expiry of a period of one year from the date on which the contempt is alleged to have been committed.
" He submitted that initiation of the proceeding by the High Court will be, without jurisdiction if it is in violation of section 20.
It may be so.
If the alleged contemner in response to the notice appears before the High Court and asks it to drop the proceeding on the.
ground of its being barred under section 20 of the Act but the High Court holds that the, proceeding is not barred, it may well be that an appeal would lie to this Court under section 19 from such an order although the proceeding has remained pending in the High Court.
We are not called upon to express our final opinion in regard to such an order, but we merely mention this type of order by way of an example to show that even orders made at some intermittent stage in the proceeding may be, appealable under section 19.
In our considered judgment, an order merely initiating the proceeding without anything further, does not decide anything against the alleged contemner and cannot be appealed against as a matter of right tinder section 19.
in a given case special leave may be granted under article 136 of the Constitution from an order initiating the proceeding.
But that is entirely a different matter.
What we are deciding in, this case is that the present appeal filed under section 19 (1) of the Act does not lie and is incompetent.
We find some support to, the view expressed by us above from the decision of this Court in Baradakanta Mishra vs Orissa High Court,(1) where it has been held that no appeal lies to this Court under section 19 of the Act from an order rejecting the prayer of the alleged contemner for bearing the case piecemeal.
Mr. Lai placed reliance on the observations of this Court in Baradakanta Mishra vs Justice Gatikrushna Mishra (2).
What has been decided therein is this : that on a reference made by the Advocate General if the Court declines to take cognisance and to initiate proceeding for contempt, the order is not an order initiating contempt proceeding.
Surely, it is not appealable under section 19.
But there are no observations by this Court nor on the facts of that case there can be any,.
to show that an appeal would lie to, this Court from an order of the High Court merely initiating the proceeding by issuance of a notice.
We, may repeat that it may be, a different matter if the order does decide (1) A.I.R. 1976 S.C. 1206.
(2) ; (at pp.
531 32).
513 some disputes raised before it by the contemner asking it to drop the proceeding on one ground or the other.
But unless and until there is some order or decision of the High Court adjudicating upon any matter raised before it by the parties, affecting their right, the mere order issuing the notice is not appealable.
The appeal is, therefore, dismissed as being not maintainable.
P H. P. Appeal dismissed.

summary/full:
The High Court passed an order directing issue of notice to the appellant to show cause why he should not be proceeded against for committing contempt .of the High Court.
The notice was issued in accordance with the procedure prescribed under section 17 of the .
The appellant filed an appeal against the said order under section 19(1) of the Act in this Court.
The counsel for the respondent raised a preliminary objection that no appeal under section 19(1) is maintainable against the order in question.
Dismissing the appeal the Court, HELD : (1) An appeal lies to this Court as a matter of right from any order or decision of a Bench of the High Court if the order has been made in the exercise of its jurisdiction to punish for contempt.
However, an appeal cannot lie from any kind of order made by the High Court in the proceeding for contempt.
The proceeding is initiated under section 17 by issuance of a notice.
Thereafter, there may be many interlocutory orders passed in the said proceeding by the High Court.
It could not be the intention of the Legislature to provide for an appeal to this Court as a matter of right from each and every such order made by the High Court.
The order or the decision must be such that.
it decides some bone of contention raised before the High Court affecting the right of the party aggrieved.
Mere initiation of a proceeding does not decide any question.
[511 F H] 2.
if the alleged contemner in response to the notice appears before the High Court and asks it to drop the proceedings on the ground of its being barred under Section 20 of the Act but the High Court holds that the proceedings is not barred, it may well be that an appeal would lie to this Court under section 19 It is neither possible nor advisable to make an exhaustive list of the type of orders which may be appealable under section 19.
[512 B C] Baradakanta Mishra vs Orissa, High Court, A.I.R. 1976 S.C. 1206, relied on.
Baradakanta Mishra vs Justice Gatikrushna Mishra ; , 53132, distinguished.