New India Motors (P) Ltd. vs K. T. Morris

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No. 124 of 1959

Decision Date: 22 March, 1960

Coram: K.C. Das Gupta, P.B. Gajendragadkar, K.N. Wanchoo

In this case the petitioner was M/S New India Motors (P) Ltd., a company based in New Delhi, and the respondent was K T Morris. The judgment was delivered on 22 March 1960 by the Supreme Court of India. The bench consisted of Justice K C Das Gupta, Justice P B Gajendragadkar and Justice K N Wanchoo. The matter was recorded as a civil appeal numbered 124 of 1959 and arose by special leave from an award dated 8 February 1957 made by the Additional Industrial Tribunal in Delhi in Miscellaneous Industrial Dispute Case No 422 of 1956. The petitioners were represented by counsel for the appellant, while the respondent was represented by counsel for the respondent, including the Solicitor‑General of India and other counsel.

The headnote of the report set out the essential facts. The respondent, who worked as a field service representative, had been dismissed by the appellant while an industrial dispute was pending before the Industrial Tribunal. The dispute involved the termination of seven other employees who were apprentices of the appellant. The respondent claimed that he was dismissed because he had taken an interest in the dispute on behalf of those apprentices, that he had given evidence for them, and that he was therefore a “workman concerned in such dispute” within the meaning of Section 33(1)(a) of the Industrial Disputes Act, 1947, as amended by Act 36 of 1956. The Tribunal, after hearing the case, found in favour of the respondent and issued an award that ordered his reinstatement. The appellant challenged the award on the ground that the respondent was not competent to raise a dispute under Section 33A of the Act because he was not directly concerned in the dispute.

The principal question for determination therefore concerned the construction of Section 33(1)(a) of the Act. Specifically, the Court needed to decide whether the phrase “workmen concerned in such dispute” applied only to those workers who were directly or immediately involved, or whether it also extended to persons who raised a dispute on behalf of other workers, as well as to those who would be bound by the award once it was made. In addressing this issue the Court referred to the earlier authorities of Eastern Plywood Manufacturing Co. Ltd. v. Eastern Plywood Manufacturing Workers’ Union (1952) L.A.C. 103 and Newtone Studios Ltd. v. Ethirajula (T.R.) (1958) 1 L.L.J. 63, both of which supported a broader interpretation. The Court distinguished the decision of New Jehangir Vakil Mills Ltd., Bhavnagar v. N L Vyas & Others, A.I.R. 1959 BOM 248, which had taken a narrower view, and expressly disapproved that judgment.

The Court held that the expression “workmen concerned in such dispute” in Section 33(1)(a) should be understood to include not only those workers who are directly and immediately concerned with the dispute, but also those who raise the dispute on behalf of other workers and those who, after the award is made, will be bound by its terms. Accordingly, the respondent was deemed to be a “workman concerned” under the statute, and the Tribunal’s award directing his reinstatement was upheld. The Court therefore affirmed the award of the Additional Industrial Tribunal, Delhi, which ordered the appellant to reinstate the respondent in his former position as field service representative and to pay him the arrears of salary from the date of his dismissal until his reinstatement.

The Tribunal ordered that the appellant, New India Motors Private Ltd., reinstate the respondent, K. T. Morris, to his former position as field service representative and pay him all wages that were due from the date of his dismissal until the date of his reinstatement. The Tribunal’s award arose from a complaint lodged by the respondent under section 33A of the Industrial Disputes Act, 1947. Before entering the service of the appellant, the respondent had been employed by a firm in Calcutta and, earlier, had served as a field service representative for M/s Premier Automobiles Ltd., Bombay. He joined New India Motors in May 1954, initially as Works Manager. Prior to his appointment, the appellant had sent a letter dated 27 March 1954 indicating that it would pay the respondent a basic salary of Rs 350 per month and would also grant him a certain percentage of the business as additional remuneration. The appellant required the respondent to attend an interview; after the interview, the appellant issued a formal appointment letter on 6 May 1954. By that letter the respondent was appointed as Workshop Manager on a probationary period of three months, subject to the terms and conditions expressly set out in the document (Exhibit W‑2). He served in that capacity until 28 February 1955, when he was reassigned to the post of field service organiser, effective from 1 March 1955. The reassignment was documented by an appointment letter dated 28 February 1955, which specified the conditions of his new duties.

On 18 April 1956 the management of the appellant requested the respondent to provide an explanation concerning several complaints lodged against him. The respondent complied and submitted a written explanation. Subsequently, the appellant issued another communication that enumerated particular instances of the respondent’s conduct for which further clarification was demanded. The respondent again responded, explaining his actions and disputing the correctness of the charges leveled against him. Despite these exchanges, on 30 June 1956 the appellant terminated the respondent’s services on the ground that the position of field service representative was being abolished. This termination formed the basis of the respondent’s complaint under section 33A, which he filed on 18 July 1956. The respondent relied on section 33A because, at the time of his dismissal, an industrial dispute was pending between the appellant and seven of its employees, and the respondent was one of the workmen involved in that dispute. The dispute concerned the termination of the seven apprentices’ services, which had been alleged to be improper and illegal, and it had been referred to the industrial tribunal on 20 August 1955. The tribunal finally rendered its decision on 2 January 1957. The present appeal does not concern the merits of that dispute or the tribunal’s decision on it.

In this case the respondent argued that, because he was a workman directly involved in the industrial dispute, the protection provided by section 33(1)(a) was applicable and the appellant could not lawfully terminate his services without obtaining the written permission of the authority before which the dispute was pending. Accordingly, the respondent lodged a complaint under section 33A of the Act. Before the industrial tribunal the appellant asserted that the respondent did not fall within the definition of “workman” prescribed by the Act and, on the merits, contended that it had been compelled to abolish the post of field service organiser because a portion of the agency work previously performed by the appellant had been lost. The respondent, on the other hand, maintained that he was undeniably a workman under the statutory definition and that the appellant’s justification for abolishing his post was neither true nor genuine. He claimed that his dismissal resulted solely from his involvement in the grievance of the seven apprentices who formed the core of the principal industrial dispute; he had, in fact, testified on their behalf during the proceedings. The tribunal examined the evidence and concluded that the respondent was indeed a workman as defined by the Act, that there was no proof supporting the appellant’s contention that it was necessary to eliminate the respondent’s position, and that the dismissal appeared to have been motivated by the appellant’s disapproval of the respondent’s support for the apprentices. Consequently, the tribunal ordered the appellant to reinstate the respondent. The question of whether the respondent qualified as a workman under section 2(s) of the Act was identified as a factual issue, and the tribunal’s finding on that issue, after considering the relevant evidence adduced by the parties, could not be successfully challenged in the present appeal. The respondent had presented evidence describing the nature of his duties as field service organiser; his appointment letter expressly required him, among other responsibilities, to inspect and carry out necessary adjustments and repairs to the vehicles sold by the appellant and to obtain signatures of responsible persons on the satisfaction forms provided to him. He testified that he supervised the operation of the workshop, assisted mechanics and other staff in their tasks, performed complex work himself, and familiarised the workmen with the special tools and equipment required for car repairs and servicing. He expressly denied that he was a member of the supervisory staff. Relying on this testimony, the tribunal determined that the respondent met the statutory definition of a workman under section 2(s), and the appellate court saw no reason to interfere with that determination.

In regard to the appellant’s contention that the respondent’s position had to be eliminated because the appellant had lost the DeSoto agency from Premier Automobiles, the tribunal noted that there was no reliable evidence indicating the precise moment at which that agency was actually forfeited. Moreover, the fact that the appellant appointed a Technical Supervisor after dismissing the respondent was regarded as a material circumstance. The tribunal further observed that, despite the loss of the DeSoto agency, the appellant continued to act as the agent for Plymouth and Jeep vehicles, and therefore it was reasonable for the tribunal to hold that a field representative remained necessary to supervise the servicing of cars sold by the appellant at external service stations.

The evidence adduced by the respondent demonstrated clearly that he had supported the case of the seven apprentices, an action that, according to the tribunal, prompted the appellant to terminate his employment. The tribunal found that the process of attributing fault to the respondent’s work began only after the appellant expressed disapproval of the respondent’s conduct in connection with that support. Consequently, the tribunal was satisfied that the dismissal of the respondent was not based on any reasonable ground; rather, it was motivated by the appellant’s indignation toward the respondent’s role in the principal industrial dispute involving the appellant and its seven apprentices. On that basis, the tribunal was justified in characterising the dismissal as mala fide.

The appellant subsequently argued before this Court that the respondent’s complaint under section 33A was incompetent. It was undisputed that a complaint could be lodged under section 33A only if there had been a breach of section 33. The appellant therefore contended that subsection 33(1)(a) did not apply because the respondent was not a workman concerned in the principal industrial dispute, and consequently his dismissal could not be said to contravene the provisions of that subsection.

The principal issue raised for determination was the construction of subsection 33(1)(a) of the Act, specifically whether the respondent qualified as a workman concerned with the main industrial dispute. The construction of those words would determine the legal answer. Prior to the amendment of 1956, subsection 33(1)(a) provided, among other things, that during the pendency of any proceedings before a tribunal, no employer should, to the prejudice of the workmen concerned in the dispute, alter the conditions of service applicable to them immediately before the commencement of the proceedings, except with the express written permission of the tribunal. Although section 33 had been amended on several occasions and its scope was finally limited by amendment Act 36 of 1956, the expression “the workmen concerned in such dispute” that appeared in the earlier version of the section had not been altered. Accordingly, the construction that the tribunal would place upon the

In this case the Court examined the meaning of the expression “workmen concerned in such dispute” that appears in section 33(1)(a) of the Industrial Disputes Act. The Court noted that, although the section had been amended by Act 36 of 1956, the specific wording “the workmen concerned in such dispute” had not been altered and therefore the original wording continued to control the construction even after the amendment. The appellant argued that the principal industrial dispute involved the dismissal of seven apprentices who were employed by the appellant, and that only those seven apprentices could be described as the workmen concerned in the dispute. Accordingly, the appellant maintained that the respondent, who was not one of those seven apprentices, was not a workman concerned in the dispute and therefore his termination could not be regulated by the provisions of section 33(1)(a). The Court observed that, at first glance, limiting the phrase to those workers who were directly or actually involved in the dispute seemed reasonable. However, when the Court considered the overall scheme of the Act and the effect of its other material provisions, it concluded that such a narrow construction could not be sustained. The Court first referred to the definition of “industrial dispute” contained in section 2(k), which describes an industrial dispute as any dispute or difference between employers and workmen that is connected with employment, non‑employment, terms of employment, or conditions of labour of any person. The Court reiterated the settled principle that, for a dispute to qualify as an industrial dispute under the Act, it must be sponsored by a group of workmen or by a union representing them; the number of workmen represented need not constitute a majority. An individual grievance alone cannot, by itself, become an industrial dispute; it must be a collective dispute between the employer on one side and the employees acting collectively on the other. This essential collective character of an industrial dispute, the Court held, must be kept in mind while interpreting the material clause in section 33(1)(a).

The Court then turned to section 18 of the Act, which deals with the persons to whom tribunal awards are binding. Section 18(3) provides that an award of a tribunal which has become enforceable shall bind (a) all parties to the industrial dispute, (b) any other parties summoned to appear in the proceedings as parties to the dispute unless the tribunal records that they were summoned without proper cause, and (c) where a party mentioned in sub‑paragraphs (a) or (b) consists of workmen, all persons who were employed in the establishment or part of the establishment to which the dispute relates on the date of the dispute, as well as all persons who subsequently become employed in that establishment or part. The Court explained that this provision makes it clear that an award arising from an industrial dispute, even if the dispute was initiated by a minority union, binds not only the immediate parties but also every employee of the relevant establishment or part at the date of the dispute and any employee who later joins that establishment. Consequently, the circle of persons bound by an award is considerably wider than the parties to the dispute itself. The Court emphasized that this broader reach of section 18 reinforces a wide‑ranging interpretation of “workmen concerned in such dispute” because the purpose of section 33 is to preserve the status quo during the pendency of an industrial dispute and to prevent any action that might create fresh discord. A narrow reading that limits “workmen concerned” only to those directly involved would undermine the legislative intent to maintain harmony throughout the whole establishment during the dispute.

It was observed that the award bound not only the parties to the industrial dispute but also those who might later become employees of the establishment or any part thereof. Consequently, the group of persons affected by the award was considerably broader than the immediate parties to the dispute. The Court noted that this broader reach was important for interpreting the words used in section 33(1)(a). In doing so, the Court emphasized that the purpose of section 33 had to be kept in view. The Legislature, by enacting section 33, intended to guarantee that an inquiry into an industrial dispute would be fair and satisfactory and would not be disturbed by any act of the employer or the employee that could create a new source of disharmony between them. While an industrial dispute was pending, the Court said, the existing situation should be preserved and no additional cause of discord should be introduced. Because preserving the status quo was the objective of section 33, the Court held that a narrow reading of the words in section 33(1)(a) would undermine that purpose. If the term “workmen concerned in the dispute” were restricted only to those who were directly or immediately involved, the employer would be free to change the conditions of employment for the remaining workers, which would inevitably generate further complications that the provision sought to avoid. Likewise, allowing other employees to raise separate disputes would also be undesirable. Therefore, the Court concluded that the central aim of section 33 conflicted with the narrow construction advocated by the appellant. From a purely grammatical standpoint, there was no justification for assuming that the workmen mentioned had to be directly or immediately concerned, and the Court found no basis for adding the extra qualification of direct or immediate concern that the narrow reading required. When determining which workmen could be said to be concerned in an industrial dispute, the Court considered the essential condition for the raising of such a dispute. If an industrial dispute could be raised only by a group of workmen acting individually or through their union, it was difficult to deny that all those who sponsored the dispute were concerned in it. The Court observed that this interpretation was consistent with the definition provided in section 2(s) and with the provisions of section 18 of the Act. Accordingly, the Court was not prepared to hold that the expression “workmen concerned in such dispute” could be limited solely to those workmen who were directly concerned with the particular dispute. In the Court’s opinion, the expression encompassed all workmen on whose behalf the dispute had been raised as well as those who would be bound by any award made in the dispute. The Court also noted that the construction of the relevant clause had previously generated divergent opinions.

In this matter, the Court observed that although there were differing opinions expressed in various industrial courts, the overall consensus among those courts favoured the broader interpretation of the clause that the Court had advocated. The Court referred to the decision in Eastern Plywood Manufacturing Co. Ltd. v. Eastern Plywood Manufacturing Workers’ Union, where the appellate tribunal identified the conflicting viewpoints and held that a narrow reading of the clause could not be justified. The Court noted that the High Court of Madras had reached a similar conclusion, as recorded in Newtone Studios Ltd. v. Ethirajulu (T.R.). Conversely, the Court recognised that the Bombay High Court, in The New Jehangir Vakil Mills Ltd., Bhavnagar v. N.L. Vyas & Ors., had adopted the narrow construction of the same provision. However, the Court explained that, for the reasons previously set out, the Bombay view did not withstand a fair and reasonable construction of the clause. Accordingly, the Court concluded that the appellant’s case could not succeed. The appeal was therefore dismissed, and the appellant was ordered to pay costs. The final order therefore dismissed the appeal and awarded costs to the respondent.