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Allahabad High Court · body

1977 DIGILAW 222 (ALL)

Pannijee Sugar Mills Mazdoor Sangh, Bulandshahr v. Pannijee Sugar and General Co

1977-04-07

S.MALIK, YASHODA NANDAN

body1977
JUDGMENT Yashoda Nandan, J. - This appeal by the Trade Union of the respondent-concern and some of the workmen thereof is directed against the judgment of a learned single Judge in a petition under Art. 226 of the Constitution quashing in part the permission granted by the Labour Commissioner, Uttar Pradesh, under Cl. J (5) of the Standing Orders applicable to the respondent-company. 2. The material facts giving rise to the writ petition and this appeal are that M/s. Pannijee Sugar and General Mills Co., Bulandshahr hereinafter referred to as the Company-carries on the business of manufacturing sugar by vacuum-pan process. On the 12th Feb. 1967 it applied to the Labour Commissioner, Uttar Pradesh, who figured as opposite-party No. 1 in the writ petition, for grant of permission to extend the period of compulsory leave of its permanent workmen for a period of four months up to a maximum of six months commencing from 9th May, 1967. This application was made in exercise of the right of the Company under Cl. J (5) of the Standing Orders governing the conditions of employment of workmen in vacuum-pan sugar factories of Uttar Pradesh. The material provisions of the Standing Orders may be extracted for ready reference. Clause `A' of the Standing Orders which deals with definition opens by saying that "In these Standing Orders unless there is anything repugnant in the subject or context", and then defines `season' as follows: "5. "Season" means the period commencing from the date when the crushing commences till the date when crushing ends............." Clause `J' of the Standing Orders, which is relevant for the purposes of the present case, reads as follows: "J- Temporary stoppage of work and playing. off of workmen for technical or trade reasons. 1. The management of a factory may at any time or times in the event of a fire catastrophe, breakdown of machinery or stoppage of the power supply, epidemic, riot, civil commotion or shortage of the raw materials or any other cause beyond the control of the management stop any machines or department or departments wholly or partially for any period or periods without notice. In the event of a stoppage of any machine or department under this order during working hours, the workmen affected, shall be notified by a notice put up on the notice board as soon as practicable as to when the work will be resumed and whether they are to remain or leave the factory. 2 .................... 3 .................... 4 .................... 5. After the close of a season the management may send the permanent workmen on compulsory leave for a period not exceeding two months if the season was of less than 90 days' duration. Provided that in exceptional circumstances beyond the control of the management e. g., breakage of machinery, disease in sugarcane and abnormally short season due to short supplies of cane, etc., the aforesaid period of compulsory leave may, with the express previous written permission of the Labour Commissioner, U. P. previously obtained be extended by the management up to a maximum of six months. Provided............... Provided further that during the period of compulsory leave the workmen concerned shall be entitled to fifty per cent of their consolidated wages. In addition, every workman living beyond ten miles of the factory will be entitled to single fare from the factory to the place of his residence going on compulsory leave and also for returning to the factory for resuming work. The fare will be given according to the class to which the workmen concerned belong in accordance with the rules of the factory, and shall be paid within one month of the expiry of the period of compulsory leave. At least a week's written notice shall be given to the workmen concerned before sending them on compulsory leave. In such notice the names of the workmen to proceed on compulsory leave, and the dates of its commencement and termination shall be specified. In sending the workmen on compulsory leave, the junior most shall first be sent. The management may make exceptions tor this on grounds of efficiency by recording; their reasons in writing .......................... Explanation; A season will be deemed to be "abnormally short" if crushing operations in a factory last for less than eighty percent of the standard number of days of crushing assumed and/or announced by Government or by any other statutory authority before the start of the season." 3. Explanation; A season will be deemed to be "abnormally short" if crushing operations in a factory last for less than eighty percent of the standard number of days of crushing assumed and/or announced by Government or by any other statutory authority before the start of the season." 3. In the present case it does not appear that any standard number of days of crushing was assumed or announced by the Government or any other statutory authority before the start of the seasons with which we-are concerned. 4. On the 10th April, 1967 the Company, which had already sent its workmen on compulsory leave for a period of two months in exercise of its right under the main part of Cl. J-5 applied again to the Labour Commissioner for extension of the period of compulsory leave of its permanent workmen by four months more on the ground that on account of exceptional circumstances beyond the control of the management the concern had had an exceptionally short season of only 45-working days. This was in continuation of its previous application dated 12th Feb. 1967' setting out reasons why extension of the period of compulsory leave under the first proviso to sub-cl. (5) of the Standing Order `J' as set out above was required. The two applications made by the Company taken together disclosed a number of reasons in addition to the abnormal shortness of the duration of the crushing season 1966-1967. It was claimed therein that the Company had suffered heavy losses and was unable to work to full capacity due to shortage of supply of sugarcane for reasons beyond the control of the company. The Company also stated that it had been making every possible effort but in vain to procure cane from every source. It was pointed out that it had been paying high salaries to its technical staff and claimed that it had the highest pay-sheet as compared with other factories of the same capacity because it had been employing a large number of workmen. It appears that the second application made by the Company was made in answer to the reply filed on behalf of the workmen. A copy of the reply filed on behalf of the workmen is not on record, although the contentions advanced have been referred to in the order passed by, the Labour Commissioner. 5. It appears that the second application made by the Company was made in answer to the reply filed on behalf of the workmen. A copy of the reply filed on behalf of the workmen is not on record, although the contentions advanced have been referred to in the order passed by, the Labour Commissioner. 5. On the 2nd May, 1967, the Labour Commissioner passed a detailed order in which the contentions put forward by the Company on the one hand and those by one workman sought to be affected on the other were elaborately set out. It was mentioned that the workmen alleged that the Company was mismanaged and it was contemplating to close down the sugar-factory and this had made the cane-growers divert sugar-cane supplies to other factories. The contentions put forward by the parties on the question whether the duration of the season could be computed by applying what was called the "institute formula" by dividing the number of actual crushing hours by 22 could be used were considered. The Labour Commissioner held, for reasons stated by him, that the formula could not be used in view of the fact that the crushing `season' has been defined in the Standing Orders itself. The Labour Commissioner found that the crushing season of the Company was 69 days and not 45 days as claimed by the employers. He further held that it had not been proved that the management intentionally avoided purchases of available cane. The Labour Commissioner took the view that, "Having regard to the main portion of Cl. J (5) it is apparent that the period of 90 days or a little less can in no circumstances be taken to be abnormally short period which has got to be substantially less than 90 days, because if the period is only a little less than 90 days it would fall under the main portion of Cl. J (5) and not to proviso thereof. In the present case, the total duration of the season as defined in Cl. J. (5) of the Standing Orders is 69 days. This period is substantially less than 90 days. Keeping in view the difficulties of the management on account of short and intermittent cane supplies I consider that some relief should be given to this factory. In the present case, the total duration of the season as defined in Cl. J. (5) of the Standing Orders is 69 days. This period is substantially less than 90 days. Keeping in view the difficulties of the management on account of short and intermittent cane supplies I consider that some relief should be given to this factory. I, therefore, allow the employers to extend the period of compulsory leave by IV2 months from the date the period of two months compulsory leave on which the workmen have been sent by the management ends in the factory". 6. By means of the writ petition, the Company challenged the legality of the order passed by the Labour Commissioner in as far as he had permitted the grant of compulsory leave only for a period of IV2 months, though the Company had asked for permission for the maximum period permissible under Cl. J (5). 7. Before the learned single Judge as well as before us, it was strenuously contended that the only function of the Labour Commissioner, while acting under Cl. J (5) as quoted above, was to find out on the material produced before him as to whether there were "exceptional circumstances beyond the' control of the management" justifying the management extending the period of compulsory leave upto a maximum of six months, It was contended that once it was found by the Labour Commissioner that there was justification for the Company on account of an abnormally short "season" to send its workmen on compulsory leave, it was purely a managerial function to decide the number of days for which the workmen shall be sent on. compulsory leave upto a maximum of six months. It was urged that the management was in the best position to know its needs and its difficulties for determining the period for which the workmen needed to be sent on. compulsory leave and the Labour Commissioner's jurisdiction ended Once he had arrived at the conclusion that there were exceptional circumstances beyond the control of the management which had resulted in an abnormally short season. compulsory leave and the Labour Commissioner's jurisdiction ended Once he had arrived at the conclusion that there were exceptional circumstances beyond the control of the management which had resulted in an abnormally short season. This contention, for very sound reasons, was repelled by the learned single Judge who held that the Labour Commissioner was empowered not only to decide as to whether there were exceptional circumstances beyond the control of the management which had resulted in an abnormally short "season" but also to decide the number of days upto which the workmen could be sent by the management on compulsory leave. 8. Of course the management still retains the option of recalling its workmen even within the maximum period allowed by the Labour Commissioner but the period must by necessity be determined by the management. We are in complete agreement with the conclusion arrived at by the learned single' Judge on this aspect of the case. 9. Learned counsel appearing for the respondent-Company urged that power of the management under the first proviso to Cl. J (5) of the Standing Orders was in all respects akin to its right to "lay-off" its workmen or to "retrench" them as defined in Section 2 (r) and Section 2 (s) of U. P. Act No, XXVII of 1947. In either case the workmen affected had merely the right to compensation in accordance with Section 6-K in one case and to retrenchment benefits as provided for by Section 6-N in the other. Similarly once the Labour Commissioner found under the first proviso to Cl. J (5) of the Standing Orders that because of reasons beyond the control of the management the "season" had been abnormally short the period for which the management chose to send its workmen on compulsory leave, provided the maximum did not exceed six months, was completely in the discretion of the management. In each of these cases the discretion was a managerial function not subject to interference unless the management was found to have acted mala fide. In each of these cases the discretion was a managerial function not subject to interference unless the management was found to have acted mala fide. It was further contended that if the management during the pendency of any conciliation proceedings before a Conciliation Officer or a Board or any proceedings before an arbitrator or a Labour Court or Tribunal or National Tribunal in respect of an industrial dispute took action against a workman under Section 33 (b) of the Industrial Disputes Act, 1947, the Labour Court can withhold permission' only if it finds that there has been victimisation of the affected workmen on unfair labour practise. On coming to the conclusion that there has been no victimisation or unfair labour practise the Labour Court cannot interfere with the discretion of the management in respect of the punishment imposed. Similarly it was urged that once the Labour Commissioner finds that there was justification for exercise by the management of the right under the first proviso to Cl. J (5) of the Standing Orders, the determination of the number of days for which the workmen are to be sent on compulsory leave becomes a purely managerial function not subject to any control. No parallel, in our opinion, can be drawn between the right of the management to `lay-off or `retrench' its workman and exercise of the power under Cl. J. (5) of the Standing Orders. The Act in such cases does not provide for any prior permission being obtained by the management as it does in the case of Cl. J (5) of the Standing Orders. Similarly no comparison is justified with the permission contemplated by Section 33 (b) of Act No. 14 of 1947 as it stands amended and the permission provided for by Cl, J (5) of the Standing Orders. In the first case the permission merely removes a bar on the exercise of the ordinary power of the master over its servants while in the other the language employed requires a determination by the Labour Commissioner on the question as to whether there were exceptional circumstances beyond the control of the management which had resulted in an abnormally short "season' but also of the period for which compulsory leave was justified in the circumstances of a given case. 10. 10. Having repelled this part of the contention of the learned counsel representing the Company, the learned single Judge went on to hold that while exercising powers under Cl J (5), the Labour Commissioner acted in a quasi-judicial capacity. He held that "it is only upon a careful examination of the facts and circumstances of the case that the Labour Commissioner should arrive at a decision at variance with the estimate of the Management as regards the period for which the permanent workmen may have to be placed on compulsory leave." It was held that: "In other words, the Labour Commissioner, in acting as the sanctioning authority, has the power to determine what the maximum period of compulsory leave should be, but he should base his decision with regard to the duration of the maximum period upon a fair examination of relevant facts and circumstances placed before him. This can only be shown to have been done by passing an order which gives reasons in support of the particular period sanctioned because the Labour Commissioner acts, in my opinion, quasi-judicially in exercising the power conferred by the proviso". In the view of the learned single Judge, the order passed by the Labour Commissioner does not disclose that he has applied his mind to the relevant circumstances justifying his granting permission to the Company to send its workmen on compulsory leave only for a period of 1 months, though the Company had desired the extension of the period of compulsory leave by a period of four months. The learned single Judge consequently found that while the finding that there were exceptional circumstances justifying grant of permission was not open to any exception, that part of the order by which sanction for compulsory leave was confined to a period of one month and a half was legally unjustified. In the view of the learned single Judge, the order of the Labour Commissioner confining sanction of compulsory leave to a period of one month and a half over and above the two months' compulsory leave already granted by the Company in exercise of powers under the main provision of Cl. J (5) was severable from that portion of the order by which the Labour Commissioner concluded that there were exceptional circumstances beyond the control of die management justifying grant of permission. J (5) was severable from that portion of the order by which the Labour Commissioner concluded that there were exceptional circumstances beyond the control of die management justifying grant of permission. The learned single Judge consequently allowed the petition in part and quashed only that part of the order of the Labour Commissioner which dealt with the period for which extension of leave was permitted, leaving the rest of the order intact. It was noticed by the learned single Judge that the Standing Orders required "express previous written permission of the Labour Commissioner, U.P. previously obtained...........". He held that since he was quashing only that part of the order by which the period of compulsory leave was permitted, there was no non-compliance with the requirements of the first proviso to Cl, J (5) of the Standing Orders. 11. We have heard learned counsel for the parties and have gone through the orders passed by the learned single Judge and are of the opinion that the order passed by the Labour Commissioner gives such reasons as are possible to be given for exercise of the powers under the first proviso to Cl. J (5) of the Standing Orders in question. 12. Under the main part of Cl. J (5) the management is at complete liberty, without the intervention of a third party, to send its workmen on compulsory leave if the crushing season is of less than 90 days' duration. This clearly discloses that if the crushing season falls short of 90 days by a very narrow 'margin the maximum period for which the management can send its workmen on compulsory leave is confined to a period of 60 days. If for instance the crushing season is of 89 days or so, it would clearly be a case covered by the main part of Cl. J (5) and the management in exercise of its managerial function is at liberty to send its workmen on compulsory leave for a period not exceeding 60 days. The crushing season could be characterised as abnormally short only if i the crushing season is far below the 90 days contemplated by the main provision of Cl, J (5). J (5) and the management in exercise of its managerial function is at liberty to send its workmen on compulsory leave for a period not exceeding 60 days. The crushing season could be characterised as abnormally short only if i the crushing season is far below the 90 days contemplated by the main provision of Cl, J (5). 'The only relevant factor for consideration in determining the period of permission in our opinion would be the number of days by which the "season" has fallen short of 90 slays provided for in the opening paragraph of Cl. J (5). It is evident that if the crushing "season" is in the neighbourhood of 90 days there would be no occasion for attracting the first proviso thereof. The only relevant factor consequently, in our opinion, is the gap between the actual crushing season of a particular company seeking permission under the first proviso to Cl. J (5) and 90 days. In the instant case, it was found by the Labour Commissioner, and has not been disagreed to by the learned single Judge, that the crushing season of the respondent-company during the relevant season was 69 days which was only about 20 days less than the period contemplated by the main part of Cl. J (5). The Labour Commissioner apparently had in mind the fact that the crushing season of the respondent-Company during the relevant season had fallen short only by 20 days of the period laid down in the main part of :C1. J (5). In this background the Labour Commissioner was perfectly justified, in our view, in refusing to grant permission to the Company to extend the period of compulsory leave for the maximum period permissible under the first proviso to Cl. J (5) and limiting it to the period of one month and a half. We find ourselves unable to agree with the view taken by the learned single Judge that the Labour Commissioner while confining his permission to a period of one month and a half acted either arbitrarily or unreasonably. In our view the only relevant consideration has been taken into account by the Labour Commissioner. 13. We find ourselves unable to agree with the view taken by the learned single Judge that the Labour Commissioner while confining his permission to a period of one month and a half acted either arbitrarily or unreasonably. In our view the only relevant consideration has been taken into account by the Labour Commissioner. 13. There is yet another reason why we are inclined to allow this appeal and set aside the order of the learned single Judge, A part of the order can be considered to be separable from another part thereof only if the two parts can stand separately and independently of each other. A permission under the first proviso to Cl. J (5) without containing the period for which permission is granted cannot be considered a "permission' within the meaning of the first proviso to Cl. J (5). The mere finding that "there were exceptional circumstances beyond the control of the management" justifying extension of the period of compulsory leave would be meaningless without the period for which the compulsory leave is sanctioned being determined therein. If the learned single Judge's order were allowed to stand, the result would be that the Labour Commissioner will now again determine the period for which the company is to be permitted to extend the compulsory leave. The order under the first proviso will consequently obtain completion only on re-determination of the period of compulsory leave already granted to it in exercise of powers under the main part of Cl. J (5). The requirement of the first proviso to Cl. J (5) however, is that the permission to extend the period of compulsory leave must be previous to the commencement of the compulsory leave permitted by the Labour Commissioner. The writ petition consequently, in our opinion, had already been rendered in-fructuous since it was impossible to comply with the first proviso to clause J (5) of the Standing Orders, as quoted above. 14. For the reasons given above, we allow this special appeal and set aside the orders of the learned single Judge. Parties shall bear their own costs. Interim orders, if any, are hereby vacated.