The J. K. Cotton Spinning and Weaving Mills... vs The State Of Uttar Pradesh and Ors

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

Court: supreme-court

Case Number: Civil Appeal No. 157 of 1959

Decision Date: 12 December 1960

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

In the matter titled The J. K. Cotton Spinning & Weaving Mills Co., Ltd. versus The State of Uttar Pradesh and Others, the Supreme Court of India delivered its judgment on the twelfth day of December, 1960. The opinion was authored by Justice K. C. Das Gupta and the bench comprised Justice K. C. Das Gupta together with Justices P. B. Gajendragadkar and K. N. Wanchoo. The petitioner in the proceedings was The J. K. Cotton Spinning & Weaving Mills Co., Ltd., while the respondents were the State of Uttar Pradesh and several other parties. The judgment was formally recorded on 12 December 1960 and is reported in the All India Reporter at page 1170 of the 1961 volume. The citation of the decision also appears in various citator references, including the Annual Federal Reporter entries for the years 1977, 1979, 1980, 1984, 1988, 1991, and the relevant case law citations such as Kanpur Mill Mazdoor Union v. Employers’ Association of Northern India (1952) 1 L.L.J. 195. The substantive issue that the Court examined concerned the application of sections three and eight of the Uttar Pradesh Industrial Disputes Act, 1947 (U.P. 28 of 1947) in the context of a proposed dismissal of workmen while an industrial dispute was pending, and the requirement of obtaining permission under the relevant Government Order dated March 10, 1948.

The Court explained that, under sections three and eight of the Uttar Pradesh Industrial Disputes Act, the Governor had issued a Government Order on 10 March 1948 which set out detailed procedures for the settlement of industrial disputes. Clause 5(a) of that Order authorised, among other things, a recognized association of employers to refer an industrial dispute to the Conciliation Board for adjudication and to obtain an award. Clause 23 of the same Order prohibited any employer from discharging or dismissing a workman during the pendency of an inquiry unless the employer first obtained written permission from the Regional Conciliation Officer. Clause 26 prescribed penalties for any contravention of the prohibition contained in clause 23. In the present case the appellant sought to dismiss certain workmen while an inquiry was still pending. The appellant did not obtain the written permission required by clause 23. Instead, the Employers’ Association of Northern India submitted an application under clause 5(a) to the Conciliation Board requesting that the Board adjudicate the dispute and issue an award that would permit the appellant to dismiss the workmen. The workmen contested the validity of that application, arguing that the appellant had failed to first comply with the procedural requirement of clause 23. The Court held that the application made under clause 5(a) was not maintainable because an employer could not invoke clause 5(a) while an inquiry was pending and clause 23 was in force. The Court observed that if both clauses were applied simultaneously, their effect would be discordant: resorting to clause 5(a) in the circumstances would cause the employer to breach clause 23 and expose the employer to the penalties prescribed in clause 26. The Court further explained that harmony was achieved when clause 5(a) was understood to apply in all cases of dismissal or discharge except where a formal inquiry, as defined by clause 23, was pending. Consequently, clause 23, being a special provision, prevailed over the general authority contained in clause 5(a). The decision affirmed the earlier authority of Kanpur Mill Mazdoor Union v. Employers’ Association of Northern India and rejected the employer’s reliance on clause 5(a) without first securing the requisite permission under clause 23.

In this case the Court referred to the judgments in Brecon (1858) 28 L.J. Ch. 598, Churchill v. Crease (1825) 5 Bing. 177 and United States v. Chase (1890) 135 U. S. 255. The matter was a civil appeal numbered 157 of 1959, arising from a judgment and decree dated 5 January 1956 issued by the Allahabad High Court in Special Appeal No. 205 and Civil Appeal No. 158 of 1959. The appeal was taken by special leave from a judgment and order dated 15 January 1952 rendered by the Labour Appellate Tribunal of India, Allahabad, in Appeal No. Cal. 47 of 1951. The appellant was represented by counsel for the Attorney‑General for India and counsel for the Employers’ Association of Northern India, Kanpur. Separate counsel appeared for respondent No. 5 in Civil Appeal No. 157/1959, for the State of Uttar Pradesh and respondents Nos. 2 and 4 in the same appeal, and for respondent No. 5 in Civil Appeal No. 158/1959. The judgment was delivered on 12 December 1960 by Justice D.A.S. Gupta.

The two appeals raised the question whether an application filed by the Employers’ Association of Northern India, Kanpur, on behalf of the J. K. Cotton and Weaving Mills Co., Ltd., a member of the Association, could be maintained in relation to the proposed termination of service of certain members of its Watch and Ward staff. The Court first outlined the long and complicated procedural history that led the matter to its present stage. The application asserted that it was made under clause 5(a) of the Government order dated 10 March 1948, as amended by a subsequent order of 15 May 1948. That order had been issued by the Governor of the United Provinces under the authority granted by clauses (b), (c), (d) and (g) of section 3 and by section 8 of the Uttar Pradesh Industrial Disputes Act, 1947.

In the application the employer reported that a series of thefts of dhoties had occurred in the mill. It further stated that the management concluded that such a situation could not continue if the Watch and Ward staff performed their duties with vigilance, correctness and honesty. Accordingly, the management claimed that it had lost confidence in the honesty of the Watch and Ward staff and decided to terminate the services of all persons employed in that capacity. The employer indicated that it intended to recruit new workers from the employment exchange and, instead of giving notice of termination, would pay the affected persons twelve days’ wages in accordance with Standing Order No. 17A. The prayer in the application was that the Board record an award allowing the J. K. Cotton and Weaving Mills Co., Ltd. to terminate the services of all members of the Watch and Ward staff whose names were listed in Annexure A.

While the application was still before the Board, the applicant withdrew the request concerning five of the workmen. Regarding the remaining workmen, the Board first dismissed a preliminary objection raised on their behalf that it lacked jurisdiction to entertain the application. After rejecting that objection, the Board declared that it would not serve the interests of either party or of the industry to permit the remaining twenty‑seven watch and ward staff members, referred to as sepoys, to continue their employment with the mill. Consequently, the Board issued an award allowing the appellants to terminate the services of these twenty‑seven sepoys, providing compensation in accordance with rates it had specified: the award granted each dismissed worker fifteen days of full wages, additional compensation for those who had completed one year of service, and a graduated additional amount for longer periods of service.

Both parties subsequently appealed the Board’s order to the Industrial Court. The Industrial Court affirmed the Board’s determination that it possessed jurisdiction, but it observed that the procedure employed by the employers’ association was defective because the mills had failed to apply to the Regional Conciliation Officer for the discharge of the sepoys in question. On the merits, the Court held that the evidence supported the Board’s conclusion that management had lost confidence in the watch and ward staff and that, in view of the applicable Standing Orders, the services of the staff should be terminated pursuant to those orders. Accordingly, the Court modified the Board’s award by directing that the services of the twenty‑seven sepoys be terminated in accordance with the Standing Orders, but that the workers would not receive the additional compensation that the Board had prescribed.

The dismissed workmen then appealed to the Labour Appellate Tribunal of India. Relying on an earlier decision of its own in Kanpur Mill Mazdoor Union v. Employers’ Association of Northern India, the Tribunal held that the application filed under clause 5(a) of the Government Order was not maintainable. On that basis, the Tribunal allowed the appeal and set aside both the Board’s award and the Industrial Court’s modification.

Following the Tribunal’s order, J K Cotton and Weaving Mills Co., Ltd. filed an application under article 226 of the Constitution in the High Court of Judicature at Allahabad, seeking a writ of certiorari to obtain the Tribunal’s records and to quash the Tribunal’s order. Mr Justice Chaturvedi, before whom the application was heard, held that the application under clause 5(a) of the Government Order was maintainable and that the Tribunal had erred in holding otherwise. However, he expressed the view that the petition was barred by undue delay and consequently dismissed it on that ground. In the Letters Patent appeal filed by the company against this decision, the Union representing the workmen raised a preliminary objection that the Allahabad High Court could not call for the records and set aside the Tribunal’s order because the records were located in Calcutta and therefore beyond the Court’s reach.

The Labour Appellate Tribunal of India held that the records in question were situated in Calcutta and therefore lay outside the jurisdiction of the Court. The learned judges who heard the appeal accepted this objection and dismissed the appeal. Nevertheless, they issued a certificate pursuant to Article 132(1) and Article 133(1)(c) of the Constitution. Subsequently, the company secured special leave from this Court to appeal directly against the order of the Labour Appellate Tribunal of India. Consequently, two appeals were before the Court – one arising from the certificate granted by the High Court and the other based on the special leave conferred by this Court – and both were jointly heard. The principal issue, as previously indicated, centered on whether an application filed under clause 5(a) of the Government order was maintainable.

The Government order, issued by the Governor of the United Provinces under the powers bestowed by the U. P. Industrial Disputes Act, 1947, contained detailed provisions governing the settlement of industrial disputes. Clause 1 provided for the constitution of Conciliation Boards consisting of three members, while clause 2 authorised the appointment of conciliation officers for specified areas. Clause 5 set out the essential rules for commencing proceedings before the Boards and described two methods for initiating such proceedings. The first method, identified as clause 5(b), required a written order from the Provincial Government to investigate a matter where an industrial dispute had arisen or was likely to arise. The second method permitted an employee, a recognised association of employers, a registered trade union of workers, or, where no registered trade union existed, up to five representatives duly elected by a majority of the workmen in the industry, to move the Board to inquire into an industrial dispute by filing a written application. Clause 5(a) was quoted in full as follows: “5(a). Any employee or recognised association of employers or registered Trade Union of workmen or, where no registered trade union of workmen exists in any particular concern or industry, the representatives not more than five in number of the workmen in such concern or industry duly elected in this behalf by a majority of the workmen, in such concern or industry as the case may be, at a meeting held for the purpose, may by application in writing move the Board to enquire into any industrial dispute. The application shall clearly state the industrial dispute or disputes which are to be the subject of such inquiry.” Clause 10 dealt with the constitution of industrial courts for specified areas, and clause 12 provided for appeals to this Court against awards made by the Board. Clauses 13 through 22 addressed the powers and procedures of the Board or the Industrial Court and imposed duties on employers to permit certain meetings. Finally, clause 23 contained a special provision concerning the discharge of workmen during ongoing inquiries or appeals.

Clause 23 states that, without the written permission of the Regional Conciliation Officer or the Additional Regional Conciliation Officer concerned, an employer, his agent, or manager may not, during the continuance of an inquiry before a Regional Conciliation Board or the Provincial Conciliation Board, or while an appeal is pending before the Industrial Court, discharge or dismiss any workman. Section 24 provides that every order or direction issued under the provisions of this Government order is final and conclusive. Clause 26 prescribes penalties for contravening or attempting to contravene any provision of the order. The overall scheme of the legislation shows that, while clauses 5(a) and 5(b) supply two modes for initiating proceedings for the settlement of industrial disputes generally, clause 23 creates a special rule that, if an inquiry is proceeding before a Regional Conciliation Board or the Provincial Conciliation Board, or an appeal is pending before the Industrial Court, no workman may be discharged except with the written permission of the Regional Conciliation Officer or the Additional Conciliation Officer involved. Clause 26 further provides that any employer who discharges or dismisses a workman during the continuance of such an inquiry or appeal without the required permission shall be liable to a fine or to imprisonment for a term not exceeding three years, or to both. The severity of the punishment demonstrates the importance that the legislature attached to the directions contained in the order. In determining whether an application under clause 5(a) was maintainable in the present case, two questions arose. The first question concerned whether an industrial dispute comes into existence as soon as an employer decides to dismiss certain workmen and intends to implement that decision. One view holds that the dispute arises only when the aggrieved party—the workmen—object to the proposed dismissal, and that the employer alone cannot declare a dispute exists before the workmen have had an opportunity to object. The opposite view, which was adopted by the High Court judge, contends that the mere proposal by the employer to dismiss workmen creates a circumstance of contemplated non‑employment that falls within the meaning of “industrial dispute.” The second question was whether the provisions of clause 23 of the order prohibit an application under clause 5(a) while an inquiry before the Regional Conciliation Board or the Additional Conciliation Board is ongoing, or while an appeal before the Industrial Court is pending. There is no dispute that on 13 June 1950, when the application under clause 5(a) was filed, an inquiry was indeed pending before a Conciliation Officer. It appears that on 9 July 1949 the Governor of the United Provinces had issued an order directing the Labour Commissioner or a nominated Conciliation Officer to restart the adjudication proceedings between the J. K. Cotton and Weaving Mills Company and S. N. Shukla, a dismissed employee of the concern, and that the adjudicator was ordered to submit his award by 15 August 1949, with subsequent extensions of the deadline.

The Governor of the United Provinces issued an order directing the Labour Commissioner of the United Provinces, or a Conciliation Officer nominated by that Commissioner, to restart the adjudication proceedings between J. K. Cotton and Weaving Mills Co. and S. N. Shukla, who had been dismissed from the concern. The Adjudicator was instructed to complete the adjudication and to submit his award by fifteen August 1949. Subsequent orders extended this deadline, first to fifteen November 1949, then to thirty‑first March 1950, thereafter to thirty June 1950, and finally to thirty September 1950. At the time these extensions were made, the Governor lacked the authority to issue such orders, rendering them invalid; they were later validated by the provisions of section three of the Uttar Pradesh Act XXIII of 1953. The learned Attorney‑General did not dispute that on thirteen June 1950, when an application under clause five‑a was filed, an enquiry was indeed pending before a Conciliation Officer. Consequently, before the management could issue any order discharging or dismissing its workmen, clause twenty‑three required that it first obtain permission for such action from the Regional Conciliation Officer. The issue then arose whether, notwithstanding the requirement of clause twenty‑three, the employer could make, and the Board could entertain, an application under clause five‑a concerning the proposed dismissal. For analytical purposes the Court assumed that an industrial dispute arose as soon as the employer decided to dismiss workmen and that the employer could normally file an application under clause five‑a in such a dispute. If the Board decided against the employer and denied permission, no difficulty would follow. The difficulty emerged when the Board, on such an application, granted the employer the requisite permission to dismiss his workmen. Under clause twenty‑four, that order, unless modified on appeal, would become final and conclusive and could not be questioned by any party, meaning that the workmen would be unable to challenge its correctness except in the manner prescribed by the Government order itself. However, if the employer, relying on the permission, proceeded to discharge or dismiss his workmen, he would plainly contravene the provisions of clause twenty‑three and would become liable to the severe penalty prescribed in clause twenty‑six‑a, which could include imprisonment for up to three years. To eliminate this apparent inconsistency, the learned Attorney‑General proposed applying the rule of harmonious construction and holding that clause twenty‑three would not apply when an order is made on an application under clause six‑a. Assuming that an application under clause five‑a could be made…

In this case the Court observed that allowing an employer to create a dispute by relying on his own proposed order of dismissal creates a clear inconsistency between clause 5(a) and clause 23, and that the rule of harmonious construction must therefore be applied. The Court cautioned, however, that harmonising provisions does not mean destroying either of them. It explained that, when interpreting statutes, courts always presume that the legislature inserted every part for a purpose and that the legislative intention is for each part to have effect; the same presumption must be extended to rules made by a rule‑making authority. The Court then examined the construction suggested by the learned Attorney‑General and found that, under that view, an employer could simply make an application under clause 5(a) on the allegation that a dispute has arisen concerning a proposed dismissal and thereby escape the requirements of clause 23 in every case. If every employer, for any reason, preferred to proceed under clause 5(a) instead of filing an application under clause 23, the latter provision would become a dead letter. The Court stressed that such a construction, which would defeat the intention of the rule‑making authority embodied in clause 23, must be avoided if at all possible. It noted that clause 23 was enacted with a definite purpose, similar to section 33 of the Industrial Disputes Act before its amendment, although there are some differences. The rule‑making authority, the Court observed, intended to prevent the resurgence of fresh disputes between employers and workmen when a dispute was already pending, and that purpose would be directly defeated if a fresh dispute were allowed to be raised under clause 5(a) in exactly those situations where clause 23 is meant to apply. The Court therefore held that complete harmony could be achieved by allowing clause 5(a) to apply in all other cases of proposed dismissal or discharge, except where an inquiry is pending within the meaning of clause 23. This approach also accords with another well‑known rule of construction that general provisions yield to special provisions. The Court rejected the Attorney‑General’s suggestion that this rule of construction applies only to a conflict between a general provision in one Act and a special provision in another Act and cannot be used to resolve a conflict between general and special provisions within the same legislative instrument. The Court found no support for that suggestion in any principle or authority. It affirmed that the rule that specific provisions prevail over general ones is not an arbitrary doctrine created by lawyers or judges, but arises from the common understanding that when the same legislator gives two directions—one covering a broad class of matters in general and another directed at only a subset of those matters—the intention is that the latter, more specific directions should govern the subset.

In discussing the appropriate rule of construction, the Court referred to the authority cited in Pretty v. Solly, which is reproduced in Craies on Statute Law, p. 205, 5th Edition. In that passage Romilly, M.R., articulated the rule that when a particular enactment and a general enactment exist in the same statute, and the general provision, if interpreted broadly, would override the particular one, the particular provision must remain operative while the general provision is to be applied only to those remaining portions of the statute to which it properly relates. The Court noted that this principle has been applied repeatedly to resolve conflicts between different provisions of the same legislative instrument, mentioning, for example, De Winton v. Brecon, Churchill v. Crease, United States v. Chase and Carroll v. Greenwich Insurance Company as illustrative authorities.

Applying that rule of construction, the Court explained that whenever a specific provision and a general provision are in conflict, the specific provision prevails and the general provision applies solely to matters not covered by the specific provision. Accordingly, the Court held that clause 5(a) of the Government Order could not be given effect in a situation where the special provisions of clause 23 were applicable. In the facts before the Court, an inquiry was already pending before a Conciliation Officer; therefore clause 23 governed any discharge or dismissal of a workman, and the employer was not permitted to rely on clause 5(a). Because the Board could not entertain an application based on clause 5(a) in those circumstances, the Court found it unnecessary to address the subsidiary question of whether an industrial dispute, as defined in clause 5(a), arises at the moment an employer decides to dismiss workmen and intends to implement that decision.

Based on those conclusions, the Court affirmed the view of the Labour Appellate Tribunal of India that the application filed under clause 5(a) on 13 June 1950 was not maintainable. The Tribunal’s decision to set aside the awards of the Conciliation Board and the Industrial Court was therefore deemed correct, and the appeal against that Tribunal order was dismissed. The Court further observed that the appellate Bench of the High Court, in the writ petition, had relied on a preliminary objection that the records of the Labour Appellate Tribunal, being situated in Calcutta, could not be reached by any writ issued by the Allahabad High Court; the Court cited the authorities (1858) 28 L.J. Ch. 598, (1828) 5 Bing. 177, (1890) 135 U.S. 255 and (1905) 199 U.S. 401 in support of that point. Since the application under clause 5(a) was unlawful, the appellant, on the merits, was not entitled to any writ, and consequently the appeal against the High Court’s order was also dismissed. The Court noted that it was unnecessary to consider the remaining issue of whether the High Court was correct in its preliminary objection.

The Court noted that it did not adopt the view expressed by the lower tribunal concerning the preliminary objection and therefore chose not to give any opinion on that matter. As a result of this decision, the Court ordered that both appeals be dismissed. In addition, the Court directed that the costs of the proceedings be awarded to the respondent who had lodged the contest. The judgment further specified that only a single set of hearing fees should be payable in respect of the matters before it. Accordingly, the Court affirmed that the appeals were dismissed and that the costs and the hearing fee direction applied as stated.