Order.-The petitioner is the 2nd accused in C.C. No. 273 of 1976. He was convicted by the learned Chief Judicial Magistrates, Quilon, under section 29 of the Industrial Disputes Act, 1947, and was sentenced to pay a fine of Rs. 200, in default of which he was to undergo simple imprisonment for two weeks. He was further directed to pay a sum of Rs. 2,500 to P.W. 2 in terms of the conciliation settlement. The 1st accused who is alleged to be the managing partner of Brothers Union Tile Works, Eravipuram, Quilon, was acquitted. The conviction and sentence were confirmed in appeal by the learned Sessions Judge. 2. The case for the prosecution is that the petitioner in his capacity as manager of the firm of which the 1st accused was alleged to be the managing partner, entered into a conciliation agreement with P.W. 3 who was the then District Labour Officer, Quilon. Exhibit P-1 is the agreement. In accordance with the agreement a sum of Rs. 2,500 is payable to P.W. 2 who is one of the workmen of the firm. This sum has not been paid either by the firm or by the petitioner who is a signatory to Exhibit P-1. 3. Section 29 of the Industrial Disputes Act, 1947, reads: “29. Penalty far breach of settlement or award.-Any person who commits a breach of any term of any settlement or award, which is binding on him under this Act, shall be punishable with imprisonment for a term which may extend to six months, or with fine, or with both, and where the breach is a continuing one, with a further fine which may extend to two hundred rupees for every cay during the breach continues after the conviction for the first, and the Court trying the offence, if it fines the offender, may direct that the whole or any part of the fine realised from him shall be paid by way of compensation, to any person who in its opinion, has been injured by such breach.” This section thus imposes a punishment upon any person who commit; a breach of settlement. Section 32 says: “32.
Section 32 says: “32. Offence by companies, etc.-Where a person committing an offence under this Act is a company, or other body corporate, or an association of persons (whether incorporated or not), every director, manager, secretary, agent or other officer or person concerned with the management thereof shall, unless, he proves that the offence was committed without his knowledge or consent, be deemed to be guilty of such offence.” Accordingly when an offence under section 29 is committed by a firm the manager thereof is deemed to be guilty of the offence so as to attract the penalty under section 29. It is not only the manager who is deemed to be guilty, but also any person concerned with the management of the firm. Consequently every partner of the firm is deemed to be guilty. 4. In the case of the 1st accused, however, the learned Magistrate held that there was no evidence to find her guilty. The prosecution did not challenge that finding. Consequently the petitioner who is the manager of the company alone stands convicted. 5. Counsel for the petitioner Shri. Sudhakara Prasad contends that the conciliation settlement (Exhibit P-1) is not valid in so far as it was not signed by a duly authorised agent of the firm. He says that there was no evidence to show that the petitioner was authorised to sign the settlement. He also contends that it was not prepared in the proper form. He relies upon rule 59 of the Kerala Industrial Disputes Rules, 1957. This rules reads as follows: "59. Memorandum of settlement.- (1) The settlement arrived at in the course of conciliation proceedings shall be in Form ‘H’ and the settlement arrived at otherwise than in the course of conciliation proceedings shall be in form H. (2) The settlement shall be signed by- (a) in the case of an employer, by the employer himself, or by his authorised agent, or when the employer is an incorporated company or other body corporate, by the agent, manager or other principal officer of the corporation. (Italics supplied) 6. Exhibit P-1 shows that it is prepared in accordance with Form H. I do not see any substance in the contention that it is not so.
(Italics supplied) 6. Exhibit P-1 shows that it is prepared in accordance with Form H. I do not see any substance in the contention that it is not so. That the petitioner signed Exhibit P-1 in his capacity as manager is not disputed, for he has described himself in that document as the manager of Brothers Union Tile Works. However, Counsel points out that rule 59(2) shows that a settlement shall be signed by the employer or by his authorised agent. It is only when the employer is an incorporated company or other body corporate that the requirement of authorisation is not needed. Counsel submits that a firm being not a body corporate is at best an employer, and consequently the manager who is an employee cannot put his signature to a settlement without specific authorisation. This is an ingenious argument. No authority is cited in support of this proposition and I am told there is none directly in point. 7. Any person who commits a breach of any term of any settlement or award which is binding upon him under the Act shall be punishable as provided under section 29. Where the offence is committed by an association of persons like a partnership, the manager or any person concerned with the management of the firm is deemed to be guilty as provided under section 32. If an offence has been committed under the Act, section 32 leaves no doubt that the manager of a firm, as in the case of any partner thereof, is deemed to be liable unless the offence was committed without his knowledge or consent. The question, however, is whether any offence has been committed. If the agreement did not come into effect for the reasons stated by the petitioner’s Counsel, no offence arose under the Act by a breach of the terms of such instrument notwithstanding that it was signed by the petitioner. Exhibit P-1 shows that it was signed by the petitioner in his capacity as the manager of the firm. His capacity to do so was not questioned either by the partners or any other person connected with the management of the firm or by the District Labour Officer who is the other signatory to the agreement. The petitioner held himself out as the duly authorised representative of the firm and he was accepted as such by all persons concerned. 8.
The petitioner held himself out as the duly authorised representative of the firm and he was accepted as such by all persons concerned. 8. Rule 59 cannot be read to mean that even where the manager of a firm has voluntarily put this signature to an instrument in his capacity as the representative of the firm, he cannot escape from the consequences flowing from the violation of the terms of the agreement by the mere fact that the authorisation required under rule 37 was not obtained. In my view rule 59 has to be, to the extent possible, read harmoniously with section 32; for it could not have been the intentions of the rule-making authority to cut down the amplitude of the section which it could not do. If so read, even a partnership firm can be represented by its manager for the purpose of signing a conciliation agreement, whether or not there is a specific authorisation to that effect, when the manager has, as in the present case, held himself out as the duly authorised agent and was accepted as such by all persons concerned. When such an instrument is signed by its manager, the firm as well as the manager will be bound by it and any violation thereof will attract the penal provisions under the Act. Of course it would have been desirable had the rule been framed with greater clarity so as to include a partnership but the lack of clarity in the rule cannot be taken advantage of by the petitioner who held himself out as the duly authorised agent and when the section itself admits of no doubt. 9. The petitioner, in the circumstances of this case, is guilty of the offence punishable under section 29 read with section 32 of the Act. 10. The Public Prosecutor fairly concedes that the direction of the Courts below in regard to the payment of Rs. 2,500 by the 2nd accused is invalid, for, it is contrary to the provisions of section 29. I agree that it is so, and the direction has to be set aside. 11. It is unfortunate that in a case of this kind the prosecution failed to discharge its duly in so far as the partners of the firm are concerned. There is no evidence as to who are the partners of the firm.
I agree that it is so, and the direction has to be set aside. 11. It is unfortunate that in a case of this kind the prosecution failed to discharge its duly in so far as the partners of the firm are concerned. There is no evidence as to who are the partners of the firm. There is no evidence that the 1st accused as the managing partner. The learned Magistrate acquitted the 1st accused because of total absence of evidence to indicate that she was the managing partner. Her acquittal was affirmed by the learned Sessions Judge and the prosecution did not pursue the matter further. If the present petitioner, who is the 2nd accused, is to be convicted, as he must be for the reasons which I indicated earlier, he would be liable to pay Rs. 200 out of his pocket and there is no guarantee that he will be reimbursed by the firm of which we have no knowledge at all from the evidence on record. Counsel for the petitioner rightly points out that once convicted he has the further liability in the case of a continuing offence to pay a sum of Rs. 200 per day as penalty. 12. There is no evidence to suggest that the petitioner is not a person of good character and reputation. In fact the evidence suggests that he is a person with a sense of responsibility, for, has he not readily put his signature to the conciliation agreement in good faith? I am of the view that in the circumstances of this case and in the interest of justice the petitioner should be released in terms of section 360, Criminal Procedure Code, on condition that he enters into a bond without sureties for a period of six months to the satisfaction of the Chief Judicial Magistrate, Quilon. It is accordingly ordered and the sentence passed against the 2nd accused is set aside. The direction with regard to the payment of Rs. 2,500 is also set aside in so far as the 2nd accused is concerned. The criminal revision petition is disposed of in the above terms.