The Buckingham And Carnatic Co. Ltd vs Venkatiah And Anr
Rewritten Version Notice: This is a rewritten version of the original judgment.
Court: Supreme Court of India
Case Number: Civil Appeal No. 874 of 1962
Decision Date: 2 August 1963
Coram: P.B. Gajendragadkar, K.N. Wanchoo, K.C. Das Gupta
In this case the Supreme Court of India heard a petition filed by The Buckingham and Carnatic Company Limited against Venkatiah and another. The judgment was delivered on 2 August 1963. The bench that decided the matter consisted of P B Gajendragadkar, K N Wanchoo and K C Das Gupta. The reported citations are 1964 AIR 1272 and 1964 SCR (4) 265, with later citations R 1968 SC 33 and R 1979 SC 582. The dispute concerned provisions of the Industrial Disputes Act relating to standing orders, termination of service for an employee absent without leave, and the rule that an employer may not dismiss or punish an employee during a period of sickness, as well as sections 73(1) and (2) and section 85(d) of the Employees’ State Insurance Act, 1948, together with Standing Orders No 8(ii) and 13(f) and Regulations 53 to 86.
The factual background was as follows. The respondent, Venkatiah, obtained a six‑day leave but failed to report for duty when the leave expired and did not send any request for an extension. Subsequently he sent two letters to the appellant together with a medical certificate issued by a Civil Assistant Surgeon, claiming that he was ill for a period of almost two months. The appellant’s medical officer could not verify that the employee had been ill for the entire two‑month period. Because the explanation for his prolonged absence was unsatisfactory, the appellant refused to reinstate him. During the same interval Venkatiah applied to the Regional Director of the Employees’ State Insurance Corporation and obtained cash sickness benefit for the period covered by the surgeon’s certificate. Dissatisfied with the appellant’s refusal, the respondent’s union referred the matter to the Labour Court, which directed the appellant’s management to restore Venkatiah to his former position. The appellant then filed a writ petition in the High Court; the writ was dismissed by the single judge. The respondent appealed to a Division Bench of the High Court under the Letters Patent. The Division Bench allowed the appeal and restored the Labour Court’s award.
On appeal before this Court the appellant argued that the circumstances fell squarely within Standing Order 8(ii) and that the High Court erred in holding that the appellant’s refusal to condone the absence was unfair, improper or in violation of section 73 of the Employees’ State Insurance Act, 1948. The respondent counter‑argued that he had received sickness benefit for the period in question and therefore no penalty could be imposed for that sickness. The Court held that Standing Order 8(ii) applied to the present case and that the fact that the same conduct was covered by two different standing orders did not affect the applicability of Standing Order 8(ii).
The Court held that the fact that the same conduct was addressed under two different standing orders did not diminish the operation of Standing Order 8(ii) in the present case. It further observed that deciding whether the appellant should have accepted the certificate issued by the Civil Assistant Surgeon was a matter for the appellant’s own consideration; because no allegation of bad‑faith or mala fides was made, the High Court, while exercising its writ jurisdiction, was not entitled to examine the propriety of the Labour Court’s conclusion on that point. In addition, the Court explained that a proper reading of section 73(1) read with subsection (2) of the Employees’ State Insurance Act showed that section 73 could not be invoked against the appellant, since the termination of Venkatiah’s services did not occur during the period of illness for which he received a sickness benefit. Consequently, the High Court was not justified in holding that the dismissal of Venkatiah under Standing Order 8(ii) violated the provisions of section 73(1). Finally, the Court ruled that the view adopted by the Regional Director concerning the effect of the Civil Assistant Surgeon’s certificate under the proviso to regulation 53 was not binding on the appellant, and that, given the construction placed on section 73(1), there was no inconsistency between that statutory provision and Standing Order 8(ii). Thus the Court clarified the limited scope of the High Court’s interference and affirmed the appellant’s discretion under the standing orders.
The appeal before the Civil Appellate Jurisdiction was numbered 874 of 1962 and arose from the judgment and order dated 15 January 1962 issued by the Madras High Court in Writ Appeal No. 82 of 1959. The appellant was the Buckingham & Carnatic Co. Ltd., a corporation incorporated under the Companies Act with its registered office in Madras. The company operated a textile mill in Madras city employing fourteen thousand workmen. The respondent was Venkatiah, whose case was supported by the Madras Labour Union. On 10 January 1957 Venkatiah was granted a six‑day leave; accounting for intervening holidays, the leave expired on 18 January 1957. He failed to report for duty on 19 January as required and remained absent without leave, without sending any communication to the appellant requesting an extension. On 11 March 1957 he wrote to the appellant stating that after reaching his village near Kanigiri he had suffered fever and dysentery and had been treated by the Civil Assistant Surgeon, Kanigiri. The letter was accompanied by a certificate from that surgeon which stated that Venkatiah suffered from chronic malaria and dysentery from 15 January to 7 March 1957. When he later appeared before the manager of the company, he was directed to undergo examination by the senior medical officer of the appellant. The senior medical officer examined him and was unable to confirm that he had been ill for a period of nearly two months. Acting on that opinion the appellant refused to reinstate Venkatiah, and when Venkatiah pressed for reinstatement, the appellant informed him on 23 March 1957 that his explanation for his absence was unsatisfactory and that he could not be taken back. The appellant treated the case under Standing Order 8(ii). Meanwhile, Venkatiah applied to the Employees’ State Insurance Corporation and, on or about 15 June 1957, obtained a cash sickness benefit for the period covered by the surgeon’s certificate. The Regional Director accepted the certificate as alternative evidence and directed that payment be made to him to the extent permissible under the Act, resulting in a payment of Rs. 82‑14‑00. Despite this, the appellant continued to refuse to take him back.
In this case, the management of the appellant called Venkatiah to appear before its senior medical officer for an examination. The officer examined him and reported that he could not verify that Venkatiah had been ill for nearly two months as claimed. Relying on that medical opinion, the appellant refused to readmit Venkatiah to his former position. When Venkatiah requested reinstatement, the appellant notified him on 23 March 1957 that his request could not be granted because the explanation he gave for his unauthorized absence was unsatisfactory. The appellant dealt with Venkatiah’s situation under Standing Order No 8(ii) of its own Standing Orders. Meanwhile, Venkatiah applied to the Employees State Insurance Corporation for sickness benefit. Around 15 June 1957 he received a cash benefit that corresponded to the period covered by the medical certificate issued by the Civil Assistant Surgeon of Kanigiri. The Regional Director who considered Venkatiah’s application accepted the surgeon’s certificate as alternative evidence and directed that the payment be made to the extent permissible under the relevant Act, resulting in a payment of Rs 82‑14‑00 to Venkatiah. After the appellant continued to refuse to readmit him, the workers’ union representing Venkatiah raised his grievance, and the dispute was referred to the Labour Court at Madras as industrial dispute (S.P.O. No A‑5411 of 1958). Before the Labour Court, the appellant argued that the reference to the Court was invalid and contended that the termination of Venkatiah’s services was justified. The Labour Court rejected the appellant’s preliminary objection concerning the validity of the reference. It observed that, if the dispute were examined solely on the basis of the Standing Orders, the appellant would have been entitled to act as it did, because it had relied on the opinion of its medical officer regarding Venkatiah’s alleged illness. When that medical opinion was challenged before the Court, the Court noted that such an attack was easy to make but declined to accept the criticism in the absence of any strong evidence showing that the medical officer had been prejudiced against the worker or motivated by a desire to victimise him. Nonetheless, the respondent succeeded before the Labour Court principally on the ground that the appellant’s decision not to reinstate Venkatiah conflicted with the provisions of section 73 of the applicable Act. Consequently, the Labour Court directed the appellant’s management to reinstate Venkatiah within two weeks of the award’s commencement, without liability for back‑wages, and to ensure continuity of his service. Following that award, the appellant filed two writ petitions in the Madras High Court, seeking to have the award set aside (W.P. No. 716 of 1958). The writ petition was allowed by Justice Balkrishna Ayyar, who held that section 73 of the Act did not apply to the case and concluded that the Labour Court’s award was essentially based on sympathy for Venkatiah rather than on the merits of the dispute.
In this matter, the learned judge observed that the Labour Court’s award had been based on sympathy for Venkatiah rather than on the substantive merits of the case, and consequently the judge set aside that award. The respondent subsequently questioned the correctness of the judge’s decision by filing a Letters Patent Appeal before a Division Bench of the Madras High Court, designated as Appeal No. LPA 82 of 1959. The Division Bench allowed the respondent’s appeal, thereby restoring the award that had been originally passed by the Labour Court.
The Division Bench held that section 73 of the Industrial Disputes Act was applicable to the facts of the present case and that the appellant’s refusal to reinstated Venkatiah constituted an illegal act. The Bench further observed that, in refusing to take Venkatiah back, the appellant had failed to fulfil its duty to examine Venkatiah’s explanation in a reasonable manner, and that this failure introduced a defect in the decision to deny his reinstatement. In other words, according to the Division Bench, the management’s action violated the provisions of section 73 of the Act and was not fair.
Against this judgment, the appellant approached this Court, presenting a certificate issued by the Madras High Court under Article 133(1)(c) of the Constitution. Counsel for the appellant argued that Venkatiah’s situation fell squarely within the scope of Standing Order 8(ii) and that the High Court erred in holding that the appellant’s refusal to condone Venkatiah’s absence was unfair, improper, or in contravention of section 73 of the Act.
Before proceeding further, the Court examined the text of Standing Order 8(ii). The Order states: “Absent without Leave: Any employee who absents himself for eight consecutive working days without Leave shall be deemed to have left the Company’s service without notice thereby terminating his contract of service. If he gives an explanation to the satisfaction of the management, the absence shall be converted into leave without pay or dearness allowance. Any employee leaving the Company’s service in this manner shall have no claim for re‑employment in the Mills. But if the absence is proved to the satisfaction of the Management to be one due to sickness, then such absence shall be converted into medical leave for such period as the employee is eligible with the permissible allowances.”
This Standing Order is part of the certified Standing Orders that were revised by an arbitration award between the parties in 1957. The relevant clause clearly indicates that when an employee falls within the first part of the provision, the defaulting employee is deemed to have terminated his contract of service. The first provision of clause (ii) operates on the premise that an absence of eight consecutive days without leave leads to the inference that the employee intended to terminate his contract of service. The certified Standing Orders constitute the applicable terms and conditions of service in a statutory format and they bind the parties at least as
In this case the Court observed that certified standing orders function much like private contracts that contain similar terms and conditions of service. The Court noted that, under common law, a conclusion that an employee has abandoned or relinquished service is not readily drawn. Such a conclusion may be reached only when the duration of the employee’s absence and the surrounding circumstances justify a legitimate inference that the employee intended to abandon his position. The Court emphasized that abandonment is fundamentally a question of intention and that intention cannot be imputed to an employee without sufficient evidence. However, the Court held that when the parties have expressly agreed to the terms and conditions of service and those terms are incorporated into certified standing orders, the ordinary doctrines of common law or equity do not control the analysis. Instead, the court must interpret the wording of the standing order itself. Accordingly, the Court read the first part of Standing Order eight, clause two, as inevitably meaning that any employee who is absent for eight consecutive days without leave is deemed to have terminated his contract of service and thereby to have relinquished or abandoned his employment. The Court further explained that the latter part of the same clause allows the employee to give an explanation for the absence, and that if the management finds that explanation satisfactory, the period of absence will be treated as leave without pay or as dearness allowance.
This latter provision functions as a proviso to the initial rule, because it requires the employer to give the employee an opportunity to explain the unauthorized absence before the inference of relinquishment of service is given effect. The Court stated that when the explanation is accepted as satisfactory by the management, the presumption of termination of the contract of service is displaced, and the period of absence is instead classified as leave without pay or as dearness allowance. Conversely, the Court observed that if the management does not consider the employee’s explanation satisfactory, the original inference arising from the first part of the clause remains operative, and the employee is deemed to have terminated his contract of service, resulting in the termination of the master‑servant relationship between the parties. The Court clarified that the remaining portions of the standing order are not the subject of consideration in the present appeal. The Court also noted that the same eight‑day unauthorised absence is characterised as misconduct under clause thirteen, sub‑clause f, of the standing orders, which deals with both single and habitual unauthorised absences. Accordingly, the Court explained that the effect of the standing orders is that an unauthorised absence of more than eight consecutive days may give rise either to termination of the contract of service under Standing Order eight, clause two, or to the imposition of penalties for misconduct after a proper enquiry is conducted as required by the relevant standing order. The Court further held that the fact that the same conduct is addressed in two separate standing orders does not preclude the application of Standing Order eight, clause two, to the case at hand.
In the case before the Court, it was observed that the appellant was not obligated to treat the employee’s absence as misconduct under Standing Order 13(f) and consequently was not required to conduct an inquiry before terminating the employee’s service. The Court noted that dismissal on the ground of misconduct under Standing Order 13 could carry different and potentially more severe consequences than termination of service that might arise under Standing Order 8(ii). Nevertheless, the Court held that if Standing Order 8(ii) applied, it could not be said that the appellant’s reliance on Standing Order 13(f) defeated the appellant’s case under Standing Order 8(ii); this point was not seriously contested. The High Court, according to the record, had concluded that the appellant had acted unfairly by rejecting the employee’s claim that he was ill and by refusing to accept the medical certificate he produced in support of that claim. The Court first examined whether that conclusion was correct. It was already established that the Civil Assistant Surgeon had, on 7 March 1957, issued a certificate stating that the employee, Venkatiah, had suffered from chronic dysentery from 15 January to 7 March 1957 and that, as of that date, he was completely recovered and fit to resume duty on 9 March 1957. The certificate was issued at the end of treatment and explicitly affirmed his fitness to rejoin work on 9 March 1957. When the appellant’s Medical Officer examined Venkatiah on 22 March 1957, the Medical Officer could not confirm that the employee had been ill for a period of nearly two months. The High Court described the Medical Officer’s certification as vague. The Court, however, interpreted that certificate as a courteous indication by the Medical Officer that, based on his own examination on 22 March, he was unable to corroborate the earlier certificate issued by the Civil Assistant Surgeon. The High Court’s impression of vagueness, the Court said, stemmed from the appellant’s Medical Officer’s attempt to observe professional courtesy toward the certificate on which Venkatiah relied. Apart from this consideration, the Court found that the High Court should not have re‑examined the Labour Court’s conclusion on that point. The Labour Court had expressly rejected the respondent’s criticism of the appellant’s Medical Officer’s conduct and had held that, had the issue been decided solely under Standing Order 8(ii), the appellant would have prevailed. Consequently, the Court saw little basis for the respondent’s grievance against the Labour Court’s finding to be upheld by the High Court while exercising its writ jurisdiction under Article 226 of the Constitution. Ultimately, the decision on whether the appellant ought to have accepted the Civil Assistant Surgeon’s certificate was a matter for the appellant’s own discretion.
It was observed that the record contains no allegation of bad faith on the part of the appellant, and consequently the Court held that the High Court was not justified in concluding that the appellant had failed to fulfill its obligation under the Standing Orders to give proper consideration to the explanation offered by Venkatiah concerning his absence. The High Court appeared to recognize this circumstance, and in its judgment it stated that its decision would be based on what it regarded as the effect of section 73, even if one were to assume that the worker’s discharge in the present case was automatic by virtue of the operation of Standing Order 8(ii). The Court therefore indicated that it would now address that particular aspect of the case. Before proceeding, however, the Court referred to an argument presented on behalf of the respondent by counsel Mr Dolia, who submitted that it would be anomalous if the appellant were permitted to reject Venkatiah’s claim that he had been ill during the relevant period, when that claim had already been accepted by the Corporation and relief had been granted to him under section 73 and the regulations made thereunder. Mr Dolia relied on the fact that Venkatiah had satisfied the authorities responsible for administering the provisions of the Act that he was ill during the period in question, and that he had actually received assistance on that basis, so that, for purposes of the Act, he was deemed to have been ill. Yet the appellant, relying on Standing Order 8(ii), held that Venkatiah was not ill during the same period. Counsel argued that it could not have been the legislature’s intention to permit such a glaring inconsistency, and therefore suggested that the appellant was bound to recognise Venkatiah’s illness for the purposes of the Act, given that the relevant authority had already accepted his claim. While acknowledging that this line of reasoning was prima facie attractive, the Court indicated that before adopting it, it would be necessary to determine whether any specific provision of the Act required the appellant to accept the view taken by the authority under the Act when it decided to give assistance to Venkatiah.
To address that question, the Court quoted the full text of section 73 of the Act, which provides: “Employer not to dismiss or punish employee during period of sickness, etc.—(1) No employer shall dismiss, discharge, or reduce or otherwise punish an employee during the period the employee is in receipt of sickness benefit or maternity benefit, nor shall he, except as provided under the regulations, dismiss, discharge or reduce or otherwise punish an employee during the period he is in receipt of disablement benefit for temporary disablement or is under medical treatment for sickness or is absent from work as a result of illness duly certified in accordance with the regulations to arise out of the pregnancy or confinement rendering the employee unfit for work. (2) No.” The Court noted that the provision expressly prohibits an employer from dismissing or otherwise punishing an employee while the employee is receiving any benefit prescribed under the Act or is absent due to illness certified in accordance with the regulations. The Court thus emphasized that any construction of the provision must be guided by its language, and that the question remained whether the language imposed a mandatory duty on the appellant to accept the determination of the authority that had granted relief under the Act. The Court proceeded to examine this issue in the subsequent discussion.
In this case, the Court noted that the provision stating that a notice of dismissal, discharge, or reduction given to an employee during the period specified in sub‑section (1) shall be valid or operative was being examined. Counsel for the petitioner, Mr. Dolia, argued that because the Act was enacted to confer certain benefits on employees in cases of sickness, maternity, and employment injury, the operative provisions of the Act should receive a liberal and beneficent construction by the court. He emphasized that the legislation is a piece of social legislation intended to grant specified benefits to the workmen to whom it applies, and therefore it would be inappropriate to interpret the relevant provisions in a technical or narrow sense. The Court accepted that this general position cannot be disputed. However, the Court explained that while dealing with the plea raised by Mr. Dolia that the section should be liberally construed, it could not overlook the requirement that such liberal construction must ultimately flow from the words used in the section. The Court observed that if the words in the section are capable of two constructions, one of which clearly assists the achievement of the object of the Act, the courts would be justified in preferring that construction over another that may not further the object of the Act. Conversely, if the wording is reasonably capable of only one construction and is clearly intractable with respect to the construction advocated by Mr. Dolia, the doctrine of liberal construction offers no assistance. Mr. Dolia suggested that the general policy of section 73 is to prevent dismissal, discharge, reduction, or any other punishment being imposed on an employee who is ill, provided that the employee has received a sickness benefit. He indicated that other cases mentioned in the section need not be referred to for the purpose of dealing with his argument. According to Mr. Dolia, the operation of section 73 is confined to cases of illness and it prohibits the imposition of any penalty wherever it is shown that, with respect to the illness in question, the employee has received a sickness benefit. In the present matter, the employee had received a sickness benefit, and therefore, for that sickness, no penalty could be imposed on him. That, in brief, was the contention that Mr. Dolia pressed before the Court. On the other side, counsel for the respondent, Mr. Sastri, argued that the words used in the section are capable of only one construction. He maintained that the section merely prohibits any punitive action being taken against the employee during the period of his illness, and he urged that the prohibition is not confined to punitive action in respect of illness alone but extends to punitive action in respect of all kinds of misconduct, whatever the cause. In his view, the section states that during the period that the employee is ill, no action can be taken against him, irrespective of the reason for that action. Mr. Sastri also contended that the clause “during the period the employee is in receipt of sickness benefit” can cover the
The argument advanced by counsel for the respondent was that the expression “during the period the employee is in receipt of sickness benefit” should be interpreted to mean only the time when the employee actually receives the benefit. Accordingly, because Mr Venkatiah did not receive any sickness benefit during the very span of his illness, counsel contended that section 73(i) could not apply to him at all. The Court found this line of reasoning unconvincing. In its view, the phrase “during the period the employee is in receipt of sickness benefit” refers to the period of the employee’s genuine illness and presupposes that, for that period, the employee is entitled to, and has in fact received, the benefit. The Court observed that in most instances the employee applies for and obtains the sickness benefit after the illness has ended. To require that the benefit be paid only while the employee remains ill would render the provision ineffective and unworkable. Therefore, the limitation suggested by counsel for the respondent – that the benefit must be paid contemporaneously with the illness – could not be read into the statutory language.
Turning to the substantive effect of section 73(1), the Court considered the complementary provision in subsection (2), which states that any notice given to an employee during the period specified in subsection (i) is void and has no operative effect. This means that a notice served in that period is invalid, regardless of whether the notice concerns dismissal, discharge, reduction, or any other form of disciplinary action. Consequently, the prohibition embodied in section 73(1) is not limited to actions taken solely on the ground of sickness‑related absence; it extends to punitive measures based on any alleged misconduct that could justify a penalty. The Court acknowledged that the wording of the clause is somewhat clumsy, but its plain purpose is to create a moratorium on all punitive actions while the employee is ill and has received sickness benefit. Accordingly, if the employee is ill and is found to have received the benefit for that illness, no punitive action may be taken against him during that time. Applying this interpretation to the present appeal, the Court concluded that section 73 cannot be invoked against the appellant because the termination of Mr Venkatiah’s services did not occur during the period of his illness for which he had received sickness benefit. There remains, however, another aspect of the question that requires further consideration.
The Court identified the principal question as the proper construction of Section 73(1), which bars an employer from dismissing, discharging, reducing or otherwise punishing an employee. The wording of the provision suggests that the prohibition targets a positive act of the employer, such as an order that dismisses, discharges, reduces or otherwise punishes the servant. Accordingly, when the termination of an employee’s service occurs automatically by operation of a contract or by virtue of a Standing Order because the employee is absent without leave for a specified period, that termination is not the product of any affirmative act or order issued by the employer; consequently, the ban contained in Section 73(1) does not apply to such automatic terminations. Counsel for the respondent, Mr Dolia, argued that the term “discharge” in Section 73(1) should be given a liberal construction and that termination of service even under Standing Order 8(ii) ought to be treated as a discharge within the meaning of the section. The Court declined to accept that contention. In interpreting the true meaning of “discharge” it considered the related provision, Section 85(d), which makes any person who contravenes Section 73 or any regulation by dismissing, discharging, reducing or otherwise punishing an employee liable to imprisonment of up to three months, a fine of up to five hundred rupees, or both. In other words, Section 85(d) renders a breach of Section 73(1) a criminal offence, and it would be unreasonable to ascribe the widest possible meaning to “discharge” in Section 73(1). The term must, in context, be understood as a discharge that results from a decision of the employer embodied in an order he passes. It may, conceivably, also encompass a discharge that the employer effects through a Standing Order, because such a discharge is, in substance, brought about by the employer with the assistance of the Standing Order. Nevertheless, the expression cannot be extended to cover an employee’s abandonment of service that is inferred under Standing Order 8(ii). For that reason, the Court concluded that the High Court was not justified in holding that the termination of Venkatiah’s services under Standing Order 8(ii), which the appellant effected by refusing to reinstate him, violated Section 73(1). Counsel for the respondent further asserted that the appellant’s narrow construction of Section 73(1) would afford employees a very unsatisfactory and inadequate protection, because if the provision only prevents punitive action during the period of illness, it offers little protection overall. The Court recognised the force of that argument but reiterated that the language of the statute, read together with its subsidiary provision, does not support such an expansive reading.
The Court observed that the wording of section 73(1) read together with subsection (2) does not support the interpretation advanced by counsel for the petitioner. The Court considered it unreasonable, and perhaps even improper, to give effect to a construction that is based solely on the assumption that the legislature intended to afford a broader protection to employees when such an assumption cannot be derived from the actual language used in the statute. The Court then turned to the authority granted to the State Government under section 96 of the Act to make rules, noting that rules were indeed framed under the Act in 1950. Chapter III of those rules deals with benefit claims, and regulations 53 through 86 in that chapter specifically relate to the certification process and claims for sickness and temporary disablement. Regulation 54 defines the categories of persons who are qualified to issue a medical certificate, while regulation 55 requires that the medical certificate be completed on the prescribed form. Regulation 57 governs the medical certificate issued on first examination, and regulation 58 deals with the final medical certificate. Regulation 63 prescribes the form that must be used to make a claim for sickness or temporary disablement, and it obliges an insured person who wishes to claim a sickness benefit to submit that form to the appropriate local office either by post or by any other method. Regulation 64 provides that if a claimant does not forward the first medical certificate or any subsequent certificate to the appropriate local office within the period specified, the claimant will not be eligible for benefit for the period indicated. In light of these rules, regulation 53 must be interpreted. Regulation 53 mandates that every insured person who claims a sickness benefit must furnish evidence of sickness for each day of illness by means of a medical certificate issued by an Insurance Medical Officer in the form prescribed by the regulations. However, regulation 53 contains a proviso stating that the Corporation may accept other evidence of sickness or temporary disablement where, in its opinion, the circumstances of a particular case justify such acceptance. In the present matter, the Regional Director relied on this proviso and accepted the certificate issued by the Civil Assistant Surgeon, thereby directing that a cash benefit be paid to the employee under section 73(1). The Court found that, given the scheme of these regulations, it is difficult to argue that the view taken by the Regional Director regarding the effect of the Civil Assistant Surgeon’s certificate is binding on the employer. The Court further noted that neither the Act nor the regulations referred to by section 73(1) contain any provision that would require an employer to automatically accept an illness determined by the appropriate authority under the Act when dealing with the employee’s case under the Standing Orders. Consequently, the argument that contradictory outcomes could arise if two different views on an employee’s illness were permitted does not sustain a persuasive basis.
In this case, the Court observed that the contention that a particular employee’s situation creates an inconsistency does not assist the appellant’s position. The Court also reiterated that the argument advanced by the appellant had scarcely any relevance when measured against the interpretation the Court was prepared to give to section 73(1) of the Act. According to that interpretation, the submission made by Mr Dolia that section 73(1) conflicted with Standing Order 8(ii) was found to have no legal merit. Before concluding the matter, the Court added that at the very beginning of the proceedings, counsel for the appellant, Mr Sastri, had expressly told the Court that the appeal was not principally intended to oppose the reinstatement order favoring Venkatiah, but rather to obtain a definitive pronouncement on the true scope and operation of section 73(1) of the Act. In effect, the appellant presented the case as a test case aimed at clarifying the construction of that statutory provision. Consequently, when the Court suggested to Mr Sastri that the appellant, described as a large and prosperous employer, should not resist the reinstatement of a single employee whose matter had reached this Court, the counsel assured the Court that he would advise his client to comply with the terms laid down by the Labour Court for taking Venkatiah back into employment. As a result, the Court allowed the appeal, set aside the order issued by the Division Bench of the Madras High Court, and restored the order originally made by the Single Judge. No costs were awarded to either party, and the final order recorded that the appeal was allowed.