Kesoram Cotton Mills Ltd. vs Gangadhar And Ors.

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

Court: Supreme Court of India

Case Number: Not extracted

Decision Date: 4 April 1963

Coram: K.C. Das Gupta, K.N. Wanchoo

The case is styled Kesoram Cotton Mills Ltd. versus Gangadhar and others, decided on 4 April 1963 by the Supreme Court of India. The bench comprised Justice K.C. Das Gupta and Justice K.N. Wanchoo, the judgment being authored by Justice Wanchoo. The matter before the Court consisted of two separate appeals filed by special leave against a single award rendered by the First Industrial Tribunal of West Bengal, and the Court chose to consider them together. Appeal number 425 was lodged by the employer, while appeal number 426 was lodged by the workmen. For the purposes of the judgment the employer is consistently referred to as the appellant and the workmen are referred to as the respondents. The dispute that was referred to the Tribunal by the Government of West Bengal involved two distinct questions. First, the Tribunal was asked to determine the relief, if any, to which the suspended workmen named in list ‘A’ were entitled. Second, the Tribunal was asked to examine whether the termination of the employment of the workmen named in list ‘B’ was justified and, if so, whether those workmen were entitled to reinstatement or compensation. List ‘A’ comprised twenty‑nine workmen, whereas list ‘B’ comprised twelve workmen.

The background of the controversy concerning the suspended workmen, as presented by the appellant, is detailed as follows. Workers in the weaving department began a slow‑down on 28 October 1957 despite having received a warning from management. On 3 November 1957, the doffers in the carding section refused to operate new machines. Workers in the loose‑godown and folding sections initiated their own slow‑downs on 27 October 1957 and 4 November 1957 respectively. Subsequently, on 23 November 1957, the spinning‑department workers adopted slow‑down tactics, engaged in other subversive activities, and abandoned their machines in organized groups, which caused both the forward and reverse processes to become idle. This collective conduct persisted for approximately four weeks, compelling the appellant to lay off a large number of employees without payment of compensation. On 3 December 1957, workers in the dye‑house and printing department commenced an illegal stay‑in‑strike. During the first week of December 1957, workers in the blow‑room and carding sections also went on strike. The strike spread on 9 December to the engineering department, the cotton godown, the bale godown, the canteen, the high‑speed winding unit and the old stores department. In response to these disruptions, the appellant found it necessary to suspend sixteen hundred workers on the grounds of participating in slow‑downs and other alleged misconduct. Thereafter, negotiations were opened between the workers’ union and management, culminating in an agreement dated 23 December 1957. While the precise interpretation of several clauses of that agreement remained contested, it is sufficient to note that the agreement required the workmen to resume their duties and to refrain from any further go‑slow actions, whether undertaken individually or collectively, and to avoid resorting to illegal means to pursue their demands.

It was also agreed that maintenance of discipline was of paramount importance and that both the workmen and the union would at all times cooperate with management in taking appropriate disciplinary action against the workmen for the purpose of preserving discipline in the factory. The agreement further provided that thirty workmen named in annexure “A” would remain suspended pending inquiry and disciplinary action by the appellant. The first term of reference dealt with those thirty workmen who were to remain suspended under the terms of the agreement dated 23 December 1957. The second term of reference concerned twelve workmen whom the appellant claimed to have committed various acts of misconduct that made them liable to dismissal under the standing orders; these twelve were formally charge‑sheeted, inquiries were conducted, and they were dismissed in accordance with the law. Because the dismissals occurred while a dispute was pending before the first industrial tribunal, the appellant filed applications under section 33(2)(b) of the Industrial Disputes Act, 1947, seeking approval of the dismissals. Before the applications could be finally disposed of, the tribunal resolved the pending dispute and issued orders on the applications. The appellant maintained that the dismissals were justified and therefore asserted that no case for reinstatement or compensation arose, a position that was disputed by the respondents and consequently referred for adjudication under the second term of reference. With respect to the first term of reference, the tribunal examined the suspension of twenty‑nine workmen listed in annexure “A”. Although annexure “A” originally named thirty workmen, one had died before the reference could be made, leaving twenty‑nine. The respondents withdrew their case concerning five of those workmen, so the tribunal considered the remaining twenty‑four. The tribunal categorized the twenty‑four workmen into five groups: group I comprised two workmen, group II five workmen, group III thirteen workmen, group IV two workmen, and group V two workmen. Counsel for the appellant did not pursue the appeal for the six workmen in groups I, IV and V; consequently the tribunal’s orders concerning those individuals—namely Govindo (No. 1), Bholanath (No. 8), Khageswar (No. 7), Ramjatan (No.,) Rampujan (No. 26) and Khetrabasi (No. 28) of list “A” attached to the order of reference—were not examined further.

The tribunal’s order listed the workmen who were identified in list ‘A’ attached to the order of reference. Regarding the five workmen classified in group II – namely Gangadhar (No 2), Ramchandra (No 3), Babaji Nayak (No 4), Pahraj (No 5) and Shankdardas (No 6) – the tribunal directed that each of them be reinstated in his position with effect from the date on which the award became operative. In addition, the tribunal ordered that the appellant should pay each of the five workmen compensation equal to fifteen months’ wages, representing the period during which they had been suspended. The appellant has raised an objection to this portion of the tribunal’s judgment.

Turning to group III, the tribunal concluded that nine of the thirteen workmen in that group should be dismissed, while the remaining four – Gulzarali (No 18), Farid (No 16), Din Mohd. (No 17) and Mohd. Islam (No 24) – should be reinstated. The reason the tribunal examined the question of dismissal for any of the workmen listed in list ‘A’ was that the appellant had filed an application under section 33(1)(b) of the Act seeking the tribunal’s permission to dismiss the twenty‑nine workmen. The appellant now contests the tribunal’s decision to reinstate these four individuals, arguing that there was no justification for treating them differently from the nine dismissed workmen, since the evidence before the tribunal was identical in all thirteen cases. Finally, the tribunal interpreted the agreement dated 23 December 1957 to mean that all twenty‑four workmen who remained before the tribunal should receive wages for twelve months covering the period of their suspension, regardless of whether they were ultimately dismissed. The appellant has also taken issue with this interpretation and the attendant order.

We begin our analysis with the matter of the five workmen in group II. The appellant’s arguments on this point are twofold. First, the appellant maintains that these workmen were charged with engaging in “go‑slow” tactics, specifically by causing unnecessary stoppage of spindles, and that documentary evidence exists which substantiates this charge. The appellant contends that the tribunal’s finding that there was no proof of such tactics is perverse and contrary to the evidence. Second, the appellant alleges that each of the five workmen faced additional allegations of misconduct beyond the “go‑slow” charge, yet the tribunal failed to consider any of the evidence relating to those other allegations and rendered no findings on them. Consequently, the appellant argues that the tribunal should have remanded the case for a fresh hearing on the additional misconduct charges, rather than issuing its present order.

In support of its position, the appellant referred to extracts taken from registers identified as Exhibits AA and AA‑1, which had been produced before the tribunal. These extracts were set out in the special leave petition filed by the appellant. The appellant relied on these extracts to demonstrate the alleged spindle stoppages and to bolster the claim that the workmen had engaged in the prohibited “go‑slow” conduct.

In the petition, the respondents argued that the document presented in the special leave petition was not an extract from Exhibits AA and AA‑1. They claimed it was a fabricated document intended to mislead the Court at the time the appeal was admitted, and therefore they urged that the special leave should be withdrawn. The contested extract referred to four workmen—Paharaj, Shankdardas, Gangadhar and Babaji—and concerned spindle stoppage occurring between 10 November and 23 November 1957. Acting on the respondents’ allegation, the Court ordered the original registers to be produced and examined. After reviewing the registers, the Court concluded that the extract reproduced in the special leave petition was not a faithful copy of Exhibits AA and AA‑1 as would be expected of a mere excerpt. Although the numerical data on spindle stoppage in the extract corresponded with the figures recorded in the registers, the registers did not contain the names of the individuals who operated the four machines whose stoppage was listed in the extract. The extract, however, assigned those names to the four workmen, asserting that they were on duty on the dates specified, and referred to some evidence to support that claim. Assuming for argument’s sake that those workmen indeed manned the machines on the indicated dates, the Court identified another serious discrepancy. Paharaj had been charge‑sheeted on 17 November and suspended immediately, so he could not have worked after that date, yet the extract shows him continuing on the machines until 23 November. Moreover, a significant spindle stoppage was recorded on the machine that the extract says Paharaj was operating after his suspension, which could not have been the case. A similar situation arose with Shankdardas, who was also charge‑sheeted and suspended on 17 November; the extract nevertheless records his presence on the machines from 18 to 23 November, and the most serious stoppage occurred during that period. Babaji was charge‑sheeted on 18 November and suspended at once, but the extract lists him as operating a machine from 19 to 23 November, coinciding with a major stoppage that must have been caused by someone else. Gangadhar was charge‑sheeted on 22 November and suspended immediately, yet the extract implies that he worked on 23 November. The Court therefore strongly disapproves of the way the extract was employed in the special leave petition to create a misleading impression. Nevertheless, the Court does not think that this sole ground warrants revoking the special leave that had been granted.

In reviewing the extract set out above, it became clear that the appellant’s claim that the tribunal had plainly mis‑understood exhibits AA and AA‑1 could not be sustained. The tribunal had provided reasons for concluding that the alleged go‑slow by the five workmen was not proved, and those reasons were not insufficient to support the conclusion it reached. One point noted by the tribunal revealed a deficiency on the part of the appellant’s company. Although charge‑sheets for the five spinning‑department workmen were issued on 17, 18 and 22 November, the appellant’s written statement before the tribunal asserted that the workers had begun slow‑down tactics and other subversive acts only from 23 November 1957. This statement was surprising in view of the earlier charges and suggested that the appellant did not possess an accurate factual picture. The same allegation reappeared in the application under section 33(1)(b) filed four months after the written statement, again claiming that the spinning‑department workers had started go‑slow on 23 November and engaged in subversive conduct. While the appellant attempted, through its evidence, to show that the slow‑down began earlier, the tribunal, finding that evidence unconvincing, refused to accept it. Consequently, the appellant’s assertion that the tribunal’s view was perverse and contrary to the two registers previously cited must fail.

The next contention raised by the appellant concerned the tribunal’s alleged failure to consider evidence relating to other charges against the same group of workmen. It is correct that the final paragraph of the award concerning these five individuals stated that the appellant had not proved the go‑slow allegation and said nothing about the remaining charges. However, a careful reading of the tribunal’s entire discussion shows that it examined the oral testimony of all witnesses concerning the other charges and found that testimony not worthy of acceptance, even though it did not expressly phrase the conclusion in those exact words. Overall, the tribunal’s reasoning indicates that it evaluated the full body of evidence, including that pertaining to the additional charges, and concluded that such evidence was insufficient to establish liability. Thus, the tribunal did consider the entire evidentiary record and rejected both the go‑slow allegation and the other charges on the same evidentiary footing.

In the judgment, it was observed that the tribunal had erred in the way it expressed its conclusion concerning the five workmen of group II. The tribunal’s final paragraph mentioned only that the allegation of go‑slow tactics had not been proved, and it failed to comment on the other charges that had been raised. Nevertheless, a careful reading of the whole award showed that the tribunal had indeed examined the evidence relating to those additional charges and had decided that such evidence was not worthy of acceptance. The narrow focus on go‑slow in the concluding sentence was explained as a result of the parties before the tribunal concentrating almost exclusively on the go‑slow allegation, thereby ignoring the other accusations. This pattern was illustrated by the situation of some workmen in group III, where, despite the absence of a go‑slow charge, evidence on go‑slow was still discussed and the tribunal concluded that those workmen were guilty of that charge. Consequently, the tribunal’s limited conclusion was a reflection of the narrow issues that were raised, not an omission of consideration. The Court therefore held that there was no basis for remanding the matter to examine the other charges against the five workmen, as the tribunal had already considered all the evidence and found it unacceptable. Accordingly, the appeal concerning the five workmen in group II was dismissed.

The Court then turned to the four workmen placed in group III, whose names had been previously recorded. These workmen were alleged to have, on various dates in October 1957, incited their co‑workers to reduce the speed of work. The tribunal examined the entire body of evidence presented against them and chose not to rely on it for a principal reason. In the case of Gulzarali, the tribunal noted the absence of any written report against him, a circumstance that differed from the other cases. For the remaining three workmen, the written reports that were eventually produced were presented very late and, more importantly, lacked the endorsement of the weaving master that was required for such documents, unlike the reports prepared by the Assistant weaving master. Because of these deficiencies, the tribunal found the evidence insufficient and therefore did not place reliance on it. The Court concluded that the tribunal had not erred in its assessment of the evidence and that the appeal against the decisions affecting these four workmen must likewise fail.

Finally, the Court addressed the broader challenge to the tribunal’s order that awarded twelve months’ wages to all twenty‑four suspended workmen whose cases had been before it. The discussion proceeded to consider the relevant clauses of the agreement dated 23 December 1957, which governed the suspension, wage entitlement, and dispute‑resolution procedures applicable to the workmen.

In this case the Court examined four specific provisions of the agreement dated 23 December 1957 that were relied upon by the respondents. The first provision, identified as paragraph 1(b), stated that charge‑sheets filed against any workman who was permitted to return to duty under paragraph 1 would not be withdrawn, and that the suspension of those named in Annexure A would remain in force and their orders of suspension would continue pending the enquiry described later in the agreement. The second provision, numbered clause 7, declared that any workman who was suspended would not be entitled to wages or any form of compensation for the period of suspension. It further provided that the suspended workmen were prohibited from raising any dispute or making any claim concerning either the suspension period or any lay‑off period, in any shape or form. Clause 8, while stating that it was without prejudice to the other provisions of the agreement, sought to settle finally all claims or issues relating to the suspension orders, the lay‑off orders issued by the company, any loss of earnings due to a slowdown in production, and any disciplinary action taken by the company; it bound all workmen to the agreement and barred any worker from making any demand or claim on those grounds. The third provision, clause 9, reiterated that the workers listed in Annexure A would remain suspended pending enquiry and disciplinary action by management, and indicated that management would attempt to reach an amicable settlement with the Union concerning the disciplinary action; if settlement failed, the dispute would be referred to the tribunal for resolution.

The Court then turned to the tribunal’s interpretation of clause 7. The tribunal had held that clause 7, which denied any wages or compensation to suspended workmen, applied only to those who were allowed to resume work under the first clause of the agreement and not to the workmen who remained suspended under clause 9. The appellant contested this view, arguing that clause 7 should also cover the workers who stayed suspended under clause 9, and thus such workers were not entitled to any compensation for the entire period of their suspension, whether before or after 23 December 1957. The Court accepted the appellant’s contention that clause 7 was intended to apply to all suspended workmen, irrespective of whether they returned to work under the first clause or remained suspended under clause 1(b). However, the Court read clause 7 in conjunction with clause 8 and concluded that both provisions were limited to suspensions that existed up to the date of the agreement and did not extend to suspensions occurring after that date. Accordingly, the Court held that clause 7’s prohibition on raising disputes or making claims related to the suspension period could only refer to past suspensions and not to any future lay‑off or suspension that might arise.

The Court observed that clause 7 prohibited any workman from raising a dispute or making a claim concerning the suspension or lay‑off period in any form. The Court held that this provision could only refer to suspensions or lay‑offs that had already occurred; it could not have been intended to apply to any lay‑off that might happen in the future. The Court noted that although clause 9 continued the suspension of thirty workmen, that suspension was pending an enquiry and disciplinary action. Accordingly, the Court could not read clauses 7 and 9 together as covering future suspensions unless the agreement contained clear language to that effect. The Court explained that, as a matter of ordinary law, a workman may be suspended while an enquiry and disciplinary procedure are pending. If the enquiry proves misconduct, the workman is dismissed and is not entitled to wages for the period of suspension. Conversely, if the enquiry results in reinstatement, the workman becomes entitled to full wages for the suspension period together with reinstatement, unless the employer imposes a lesser punishment by withholding part of the wages for that period. The Court referred to the decision in The Straw Board Mfg. Co. v. Govind ([1962] Supp. 3 S.C.R. 618), where it was observed that if a tribunal does not approve the employer’s action, that action fails and the workman is deemed never to have been dismissed, remaining in the service of the employer. From that principle, the Court inferred that a workman fully exonerated after an enquiry remains in the employer’s service and is entitled to his full wages for the suspension period. Consequently, when clause 9 envisaged suspension pending enquiry and disciplinary action, it also contemplated the corresponding consequences: if the enquiry leads to dismissal, the workman receives no wages for the suspension period; if the enquiry leads to reinstatement, the workman is entitled to full wages for that period, or to reduced wages only if the employer imposes a punishment less severe than dismissal. The Court found no language in clause 7 that would remove this legal consequence that follows an enquiry and disciplinary action. Therefore, the Court concluded that clause 7 must be limited to the suspension period up to the date of the agreement and should not be read as applying to future suspensions. For future suspensions, the Court held that clause 9 alone governs, and it inherently includes the enquiry, disciplinary action, and the resulting wage entitlement depending on the outcome, in the absence of any provision to the contrary.

In considering the effect of clause 9 of the agreement for future periods, the court observed that if the parties had intended that workmen who remained suspended under clause 9 would receive no wages for any future period even after being fully exonerated by an inquiry, the agreement would have contained an explicit provision to that effect within clause 9 itself. Because such a provision was absent, the court held that clause 7 was limited to the period up to the date of the agreement, including the grace period provided in clause 1 for workmen to resume their duties, and did not extend to future periods. Accordingly, the tribunal was not unjustified in awarding wages for the suspension period that fell after the date of the agreement to those workmen whom it reinstated. The appellant’s claim that the tribunal acted improperly with respect to those reinstated therefore failed. The court indicated that it would now turn to the matter of the nine workmen who had been permitted to be dismissed when it examined the appeal filed by the workmen.

Turning to the second term of reference, the court found that inquiries had been conducted in the cases of the five workmen concerned. The respondents contended that those inquiries breached the principles of natural justice because the witnesses were not examined‑in‑chief before the inquiry officer. The factual record showed that, at each inquiry, the witnesses were first presented with their previously prepared signed statements, which were then read aloud to them. The witnesses were asked to confirm the correctness of the statements and to affirm their signatures. The same statements were subsequently read to the workmen who were charged, and the workmen were invited to cross‑examine the witnesses. No copies of the witnesses’ statements were ever provided to the workmen. The tribunal concluded that this procedure was open to objection, was contrary to the principles of natural justice, and that the witnesses ought to have been examined‑in‑chief in the presence of the workmen whose cases were being considered. The court reiterated the requirements of natural justice as articulated in The Union of India v. T. R. Verma [(1958) S.C.R. 499], quoting: “Rules of natural justice require that a party should have the opportunity of adducing all relevant evidence on which he relies, that the evidence of the opponent should be taken in his presence, and that he should be given the opportunity of cross‑examining the witnesses examined by that party, and that no materials should be relied upon against him without his being given an opportunity of explaining them. If these rules are satisfied, the enquiry is not open to attack on the ground that the procedure laid down in the Evidence Act was not strictly followed.” The court further referred to the observations in State of Mysore v. S. S. Makapur, quoting: “When the evidence is oral, normally the examination of the witness will in its entirety, take place before the party charged, who will have full opportunity of cross‑examining him. The position is the same when a witness is called, the statement given previously by him behind the back of the party is put to him, and admitted in evidence, a copy thereof is given to the party, and he is given an opportunity to cross‑examine him. To require in that case that the contents of the previous statement should be repeated by the witness word by word, and sentence by sentence, is to insist on bare technicalities, and rules of natural justice are matters not of form but of substance. In our opinion they are sufficiently complied with when previous statements given by witnesses are read over to them, marked on their admission, copies thereof given to the person charged, and he is given an opportunity to cross‑examine them.”

In this case, the Court observed that the person against whom an inquiry is held must be afforded a full opportunity to cross‑examine any witness. The Court explained that the same principle applies when a witness is called and a prior statement, which was originally recorded without the presence of the party, is later put to the witness and admitted as evidence. The Court stated that a copy of that prior statement must be given to the party and that the party must be allowed to cross‑examine the witness about it. The Court further held that it would be unreasonable to require the witness to repeat the contents of the prior statement word for word and sentence for sentence; such a requirement would amount to a mere technicality, because the rules of natural justice are concerned with substance rather than form. In the Court’s view, the rules are satisfied when prior statements are read to the witnesses, marked as admitted, copies of those statements are handed to the person charged, and the person charged is permitted to cross‑examine the witnesses.

The Court noted that the appellant argued that the rules of natural justice are identical whether they govern inquiries under Article 311 or domestic inquiries conducted by management into alleged misconduct by workmen. The Court agreed that the rules of natural justice do not vary from one tribunal to another. However, the Court emphasized that the purpose of those rules is to protect the position of the person subject to the inquiry, enabling that person to meet the charges properly. Consequently, the Court said that the nature of the inquiry and the status of the person against whom it is held influence the minimum requirements of natural justice. For example, where lawyers are permitted before a tribunal and the party is represented by counsel, a mere reading of the material to be used in the inquiry may sometimes be sufficient, as noted in New Prakash Transport Co. v. New Suwarna Transport Co. [1957] S.C.R. 98. In contrast, the Court observed that in a domestic industrial inquiry where lawyers are not allowed, something more than a simple reading of statements is necessary to safeguard the industrial worker’s interests. The Court took judicial notice that many industrial workers are illiterate and that even union representatives may be absent to defend them. In such circumstances, reading a prepared statement quickly and then asking the workman to cross‑examine would defeat the purpose of natural justice, which requires a genuine opportunity to defend oneself. Accordingly, the Court concluded that, in domestic industrial inquiries, management should examine witnesses from beginning to end in the presence of the workman, because oral examination, though longer than a mere reading, more fully conveys the evidence to the person against whom the inquiry is held.

In this matter the Court observed that an oral examination of witnesses during a domestic inquiry generally takes longer than a mere reading of written statements, but it presents the evidence more clearly to the person against whom the inquiry is being held. Consequently, the Court expects that, as a rule, a domestic inquiry conducted by management should involve the direct examination of witnesses from beginning to end in the presence of the employee who is the subject of the enquiry. The Court also recognised the argument advanced by the appellant that the core principles of natural justice cannot vary from one tribunal to another. Accordingly, the Court acknowledged that, although not the norm, an alternative method of conducting a domestic inquiry may be permissible in exceptional cases, provided it follows the approach laid down in the Shibavasappa case. The Court stated that, at a minimum, when witnesses are not examined in‑chief throughout the enquiry, the employee charged must be furnished with copies of the witnesses’ statements well before the enquiry commences. “Well in advance” was explained to mean that such copies should be supplied at least two days prior to the start of the inquiry. The Court further held that if this requirement is not fulfilled and the witnesses are still not examined fully in‑chief, the essential principle of natural justice—that the person charged must have a reasonable opportunity to defend himself—cannot be said to be satisfied in a domestic industrial inquiry. In the present case, the Court found that the tribunal had merely read the prepared statements to the workmen who were charged and then asked them on the spot to cross‑examine the witnesses. The workmen were naturally unable to do so. On these grounds, the Court agreed with the tribunal—though for different reasons—that the enquiry had failed to comply with the principles of natural justice. Accordingly, the Court affirmed the tribunal’s order that the inquiries were vitiated by the disregard of natural‑justice rules. The Court added, however, that despite this finding, the tribunal had still terminated the service of four of the five workmen and reinstated only one, and that this aspect would be examined later when the Court considered the appeal of the workmen.

Turning to the appeal filed by the workmen‑respondents, the Court noted that their first contention was that the tribunal had erred completely in allowing the dismissal of nine workmen listed in “list A” of the order of reference. The nine workmen named were Hanif (No. 10), Narayan (No. 11), Khalil (No. 12), Abdul Subhan (No. 13), Bhagwan Singh (No. 15), Ram Ekbal (No. 19), Mangroo (No. 20), Satish (No. 21) and Raja Ram (No. 22). The workmen‑respondents argued that these nine individuals, who were placed in group III, had been charged solely with the offence of inciting other workers to slow down work, and that no charge of “go‑slow” had been made against them personally. They maintained that the sole allegation against them was the alleged incitement and that no evidence or finding existed to show that they themselves had engaged in a go‑slow. The Court indicated that it would have to examine the evidence and findings for each of the nine workmen to determine whether this contention was correct.

The tribunal admitted testimony that the nine workmen listed in group III had actually engaged in a go‑slow themselves and it recorded a finding to that effect. On that basis the tribunal allowed their dismissals. The respondents argued that the tribunal never found any evidence that these workmen had incited other employees to reduce the pace of work, and that no proof existed of the specific charge of incitement levelled against them. They contended that, because the charge of incitement was not proven, the workmen could not be dismissed on a charge that had never been established, and that the tribunal had ignored the charge that had indeed been framed but not proved. Consequently, the Court needed to examine the record of each workman individually to determine whether the respondents’ contention was correct.

With respect to the first workman, Hanif, the award indicates that although the finding section contains a suggestion that Hanif was personally guilty of a go‑slow, the tribunal was aware that the charge against him was for inciting his co‑workers to slow down. Evidence was placed before the tribunal showing that Hanif moved about the department encouraging other workers to reduce their output, and the tribunal considered and accepted that evidence. The tribunal’s ultimate conclusion was that Hanif had been properly charge‑sheeted by the appellant and that the appellant was therefore entitled to dismiss him. Accordingly, it cannot be said that there was an absence of evidence supporting the charge framed against Hanif, nor can it be said that the tribunal failed to find the charge proved, even though there is a hint in the discussion that Hanif might also have taken part in a go‑slow. The tribunal’s finding that Hanif had incited other workers satisfied the criteria of misconduct under standing order 22(k), which permits dismissal. For these reasons, the Court saw no basis to interfere with the tribunal’s order in Hanif’s case. The next workman, Narayan, was likewise charged with incitement. The tribunal’s discussion began by stating that Narayan was charged with encouraging other workers to slow down and cited evidence that he had toured the department urging workers to operate only two looms instead of four, resulting in low production. The tribunal appeared to accept this evidence and, although it concluded that Narayan had taken part in a deliberate go‑slow, the award’s discussion shows that the tribunal was also satisfied that he had incited fellow workers to reduce their pace. In view of these findings, the Court found no reason to disturb the tribunal’s dismissal order against Narayan.

In the matter of the workman identified as Narayan, the tribunal’s award initially gave the impression that his dismissal was based on his own participation in a deliberate go‑slow. The charge against him was that he circulated among the employees and urged them to work on only two looms instead of the required four, thereby lowering overall production. The narrative portion of the award made clear that the tribunal was satisfied that Narayan had not only taken part in the slow‑down himself but had also incited other workers to reduce their pace. While the tribunal’s final wording seemed to focus on personal misconduct, the factual finding accepted by the tribunal was that he had actively encouraged his co‑workers to work less. On the basis of this combined factual determination, the Court found that there was no substantive ground to interfere with the tribunal’s order in Narayan’s case.

The next case concerned the workman named Khalil. He faced the same charge of inciting other employees to slow down work. Evidence was presented showing that Khalil had indeed urged his fellow workers to reduce the number of looms they operated, and the tribunal accepted this evidence as proved. The award discussed Khalil’s conduct primarily as incitement, yet at the conclusion the tribunal held that the appellant had succeeded in establishing that Khalil himself had indulged in go‑slow tactics, leading to a decline in production. Consequently, the tribunal permitted his dismissal on the grounds of the misconduct of slowing down as detailed in the charge‑sheet. The tribunal’s language did not expressly separate incitement from personal go‑slow, but the entire discussion demonstrated that the tribunal’s factual finding was that Khalil had encouraged others to work slower. The Court therefore held that the lack of precise wording did not merit interference with the tribunal’s order.

The subsequent case involved the workman Abdul Subhan. The charge against him was likewise for inciting other workmen to slow down, specifically by persuading them to operate only two looms instead of four. The tribunal accepted this evidence and, in its concluding remarks, stated that the appellant had proved Abdul Subhan’s involvement in go‑slow tactics, leading to the permission of his dismissal. Although the tribunal’s final expression of its finding used wording that could be described as inappropriate, the substantive determination was that Abdul Subhan had incited his colleagues, thereby effecting a slow‑down. The Court therefore saw no reason to disturb the tribunal’s finding. Finally, the case of Bhagwan Singh was considered. He was charged with inciting other workers to reduce their output, and evidence was introduced that he moved around the weaving shed urging weavers not to handle more than two looms when four looms were expected. The tribunal accepted this evidence and, in its conclusion, stated that Bhagwan Singh had engaged in the misconduct of deliberate go‑slow tactics. Once again, the Court observed that the tribunal’s wording was not ideal, but the factual finding that Bhagwan Singh had incited other workers to slow down was clear. Accordingly, the Court found no justification for interfering with the tribunal’s order in his case.

In the matter concerning Bhagwan Singh, the tribunal’s language was noted to be improper, yet the factual finding was that he had indeed incited fellow workers to reduce their work pace. The higher authority therefore found no justification for altering the tribunal’s order regarding Bhagwan Singh. A similar assessment was applied to the case of Ram Ekbal, whose circumstances and evidentiary record mirrored those of Bhagwan Singh exactly. Because the evidence and the nature of the allegation were identical, the higher authority likewise concluded that there was no ground to disturb the tribunal’s decision in Ram Ekbal’s case.

The next individual considered was Mangroo, who faced an accusation of encouraging other employees to slow their work. Evidence presented showed that Mangroo moved through the weaving‑shed urging weavers to operate two looms rather than the required four. The tribunal accepted this evidence but articulated its conclusion in language that suggested Mangroo had directly engaged in the “go‑slow” conduct described in the charge‑sheet, thereby justifying his dismissal. The reviewing authority held that while the tribunal’s phrasing was inappropriate, the substantive finding was that Mangroo had incited others to adopt a slower work pace. It was observed that the tribunal appeared to equate the act of incitement with personal participation in deliberate go‑slow tactics, which led to the improper wording. Nonetheless, the essential determination was that Mangroo was guilty of incitement, and consequently, there was no reason to interfere with the tribunal’s finding concerning him. The subsequent cases of Satish and Raja Ram were treated in a comparable manner. Both men were charged with inciting fellow workmen to slow down, and the tribunal’s evidence supported these charges. Although the tribunal’s wording again suggested that the individuals had personally engaged in go‑slow tactics, the higher authority concluded that the true finding was one of incitement. Accordingly, the tribunal’s orders against Satish and Raja Ram were left undisturbed. The respondents additionally argued that the tribunal should have awarded full wages to the workers listed in “list A,” who were ordered reinstated, rather than the fifteen months’ wages actually granted. The authority affirmed the settled principle that, under the relevant legal framework, the tribunal’s award of wages was proper.

In the ordinary relationship of master and servant, the authority to suspend a servant without wages cannot be read into a standard contract of service unless the contract itself expressly contains such a term or a statutory provision governs the contract. The Court referred to the decision in The Management of Hotel Imperial New Delhi v. Hotel Workers’ Union to illustrate this principle. No clause in the standing orders presented to the Court authorized the appellant in the present case to withhold wages while suspending a workman. Nevertheless, the Court noted that, as held in The Hotel Imperial case, where Section 33 of the Industrial Disputes Act removes the employer’s power to dismiss an employee without the permission of an industrial tribunal, the employer may nevertheless suspend the employee pending the tribunal’s inquiry and decision. In such circumstances, a term permitting suspension may be implied in the employment contract, and the effect of the tribunal’s permission would be to terminate the contract, thereby relieving the employer of any further wage liability from the date of suspension. Conversely, if the tribunal refuses permission, the employee remains entitled to all wages from the suspension date onward. Applying this reasoning, the Court concluded that for those workmen ordered to be reinstated there could be no justification for denying wages from the date of suspension, which, for the workmen listed in ‘A’, began on 24 December 1957 in accordance with the agreement dated 23 December 1957. Consequently, for the fifteen workmen in list ‘A’ who were ordered to be reinstated, the Court found no basis to limit their wages to the fifteen months previously awarded. The respondents’ appeal concerning these fifteen workmen was therefore allowed, and the tribunal’s order was varied so that the workmen will receive full wages dating from 24 December 1957.

Regarding the five workmen in list ‘B’, the tribunal had ordered the reinstatement of one workman, Hiralal Bhomick, and had awarded him compensation equivalent to fifteen months’ wages. The Court observed that his situation is essentially identical to that of the fifteen workmen in list ‘A’ already considered. Accordingly, the Court held that Hiralal Bhomick is likewise entitled to his full wages from the date his suspension commenced, and not merely the fifteen months’ wages previously ordered. The judgment then turned to the nine workmen from list ‘A’ whose cases had already been examined and who were permitted to be dismissed, as well as to four workmen from list ‘B’ – namely Misra (No. 1), Abdullah (No. 2), … – whose services were allowed to be terminated with effect from the date the award became enforceable. The Court’s analysis of these dismissal cases was to follow, anchored on the principle that the entitlement to wages depends upon the tribunal’s ultimate determination of reinstatement or termination.

In this part of the case, the Court considered two workmen, namely Narayan Tewari (identified as No. 5) and Din Mohd. (identified as No. 6), whose employment was terminated effective from the date on which the tribunal’s award became enforceable. The tribunal had previously awarded twelve months’ wages to the first nine workmen on the list, while the remaining four workmen were granted wages for only one month together with a compensation amount calculated as fifteen days’ average pay for each completed year of service, or for any part of a year that exceeded six months. The respondents argued that, notwithstanding the tribunal’s eventual permission to dismiss these employees or to terminate their services, the workmen should have been paid full wages up to the date on which the award was enforced.

The Court then examined the situation of the nine workmen classified in list ‘A’. It held that their case fell squarely within the precedent set by the Court’s earlier decision in Messrs Sasa Musa Sugar Works (P) Ltd. v. Shobrati Khan [1959] Supp 2 S.C.R. 836. Under clause (9) of the applicable agreement, the suspension of these workmen could continue only while an inquiry and subsequent disciplinary action by management were pending. The same clause further required the management to attempt an amicable settlement with the union concerning any disciplinary measures; if such a settlement could not be reached, the dispute was to be referred to adjudication. The respondents maintained that this provision clearly envisaged an inquiry followed by disciplinary steps, and because the appellant had conducted no inquiry before seeking adjudication and permission to dismiss, the workmen were entitled to receive full wages until the award’s enforcement date. Conversely, the appellant contended that clause (9) merely prescribed an inquiry and disciplinary process, but also allowed for an attempt at settlement, after which adjudication could follow; therefore, the absence of an inquiry was justified. The factory manager, who testified as the last witness, explained that he had discussed the matter with the union secretary and that no settlement could be achieved. He added that management was prepared to hold inquiries, but the union secretary had advised that inquiries would be futile because any final action required prior union consultation. The union secretary, who had testified earlier as the first witness, was not questioned on this issue. Moreover, the application filed on 29 June 1959, seeking permission to dismiss, made no claim that the inquiry was omitted because of the union secretary’s suggestion, nor did the appellant’s written statement allege such a reason. Consequently, the Court found no evidence that the respondents themselves opposed the holding of an inquiry; instead, it concluded that management had sought dismissal without conducting an inquiry, rendering the Sasa Musa precedent fully applicable and entitling the nine workmen to full wages from 23 December 1957 until the date the tribunal’s award permitting dismissal became enforceable.

The secretary of the union had indicated that conducting an inquiry would be useless, and the appellant’s written statement did not contain any allegation to the contrary. Because of this, it was difficult to conclude that the reason no inquiry was held was that the respondents themselves opposed an inquiry. Consequently, the situation was that the management intended to dismiss the workmen without first conducting an inquiry, and the Court found that the decision in Sasa Musa case [[1959] Supp. 2 S.C.R. 836] applied fully to the nine workmen who had been allowed to be dismissed. Those nine workmen were therefore entitled to receive their full wages from 23 December 1957 up to the date when the tribunal’s award permitting dismissal became enforceable.

Next, the Court turned to the matter of the four workmen whose services had been ordered to be terminated. No argument was presented before the Court concerning the order that permitted their termination, and the Court saw no error in the tribunal’s order on that point. The tribunal had observed that, had the inquiry proceedings been defective, the four individuals would have been subject to dismissal as directed by the appellant. Since the tribunal found a defect in the inquiry proceedings, it concluded that the dismissals were not justified. Accordingly, the tribunal proceeded to allow the termination of service for those four workmen under one of the standing orders, and it ordered that they receive wages for a period of one month together with compensation calculated at fifteen days’ average wages for each completed year of service, or any part thereof in excess of six months. The factual matrix of this case differed from that in Sasa Musa case [[1959] Supp. 2 S.C.R. 836]; therefore, the principle laid down in that earlier case did not automatically apply here. In view of these differences, the Court saw no reason to interfere with the tribunal’s order.

In the end, the Court affirmed the tribunal’s award, subject to the modifications described above. The management’s appeal was dismissed, while the workmen’s appeal was allowed only to the extent of granting the wages specified earlier. Both parties were ordered to bear their own costs in the respective appeals. The appeal numbered C.A. 425 of 1962 was dismissed, and the appeal numbered C.A. 426 of 1962 was allowed in part.