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1985 DIGILAW 992 (ALL)

Obeetee Pvt. Ltd. , Mirzapur v. State of U. P

1985-10-14

B.D.AGARWAL

body1985
ORDER B.D. Agarwal, J. - The petitioner is a private limited company engaged in the manufacture and sale of handmade woollen carpets. It had factories at Mirzapur, Gopepur (P.O. Gopiganj,district Varanasi) and Guriya (P.O. Thatra, district Varanasi) besides branches at different places. On July 20,1979 the petitioner took policy decision to transfer certain categories of employees from the Mirzapur to the Gopepur (P.O. Gopiganj) factory on ground inter alia that embossing and clipping of carpets had been stopped in Mirzapur factory since that had become uneconomic. The 44 workmen represented by the Sanyukt Kalim Mazdoor Sabha (respondent No. 3) covered under the order of transfer were drawn from the categories of embossers, clippers, binders, repairers, designers and labourers. A general notice for transfer was pasted on July 20, 1979, followed by intimation to the Assistant Labour Commissioner, U.P. Individual orders of transfer were issued on 13th Aug., 1979, and in some cases on 1st Oct., 1979. The workmen agitated against this and went on strike. The district authorities, it appears, intervened whereupon the petitioner offered in writing dated 5th March, 1980, that it shall arrange for regular bus service from Mirzapur to Gopepur and back and further : That the Management shall do its best to introduce the proposed bus service at its earliest but in the meantime the workmen concerned are advised to use their own conveyance. The expenses incurred in this behalf will be met by the Management at the rate of Rs. 4/- per day for the number of days they attend the duty". In Paras 6 and 7 thereof the company stipulated : '6. That the aforesaid arrangement will not prejudice the right of transfer of the workmen by the Management from one Factory/Office or arrangement prejudice the proceedings in the arbitration of any present or future industrial dispute. 7. That this arrangement is made only for the period lying between today and the date of award of the Arbitration proceedings." 2. This letter of the petitioner addressed to the City Magistrate, Mirzapur is Annexure `4' to the writ petition. The offer contained therein was accepted for the workmen concerned. The strike was thereupon ,withdrawn and the workmen concerned joined at Gopipur factory with effect from March 6, 1980. An arbitration agreement had been entered into on Feb. 5, 1980; this, however, was not published and did not fructify. The offer contained therein was accepted for the workmen concerned. The strike was thereupon ,withdrawn and the workmen concerned joined at Gopipur factory with effect from March 6, 1980. An arbitration agreement had been entered into on Feb. 5, 1980; this, however, was not published and did not fructify. The concession which the petitioner had agreed to on 5th of March 1980, was withdrawn by it unilaterally on 10th May, 1980, in the form of a letter addressed to the City Magistrate (vide Annexure `5' to the writ petition). The State Government thereafter under order dated Sept., 8, 1981, made reference under S. 4K of the U.P. Industrial Disputes Act, 1947, to the Industrial Tribunal (1) U.P. at Allahabad of the following industrial dispute : Kya Seva Yojkon Dwara Parishist Men Ankit 44 Shramikon Ka Asthanantaran Mirzapur Isthit Factory Se Gopiganj Isthit Factory Ko Kiya Jana Uchit Tatha/Vaidhanik Hai? Yadi Nahi To Sambandhit Shramik Kya Labh/Anutosh (Relief) Pane Ke Adhikari Hai Tatha Anya Kis Vivran Ke Sath". 3. In the award given on Oct. 20,1984, the Tribunal found that there was no proof of victimisation or unfair labour practice on the part of the employer. The notice, it was , observed, did not mention that there was stoppage of work at the Mirzapur factory. The order of transfer was found to be vitiated on ground that there was no provision in support contained in the Standing Orders; there was no such term in the order of appointment nor did the petitioner establish the existence of any such practice. Having reached this finding the Tribunal took up for consideration the relief to be granted. It took note of the fact that the workmen concerned had joined and started working in the Gopipur factory, the Mirzapur concern had ceased to be a factory the employers had earlier to purchase peace offered to arrange transport of pay Rs. 4/- per day to each workmen as travelling/conveyance allowance the daily expense involved in this would come to Rs. 5/-per day and accordingly directed that the 44 workmen who had been transferred by the company from its Mirzapur factory to Gopiganj and have not been provided residential accommodation at Gopiganj should be paid conveyance/transport allowance @ Rs. 5/-per day of work performed at Gopiganj factory. 4. Aggrieved, the company has preferred this writ petition under Article 226 of the Constitution. 5/-per day of work performed at Gopiganj factory. 4. Aggrieved, the company has preferred this writ petition under Article 226 of the Constitution. Affidavits have been exchanged between the parties. With the consent of the parties' counsel this is being disposed of finally at the preliminary hearing. 5. Learned counsel for the petitioner urged that the Tribunal is not right in observing that the notice dated July 20,1979 did not mention that there was shortage of work in the Mirzapur factory and hence it could not be accepted that this was the cause for general transfer. In para 23 of the award, it would appear, the notice in question is misquoted. The text of the notice is contained in Annexure I to the writ petition, the respondent's learned counsel does not dispute before me the authenticity thereof. The notice does mention "also because of shortage of work in the Mirzapur Factory". The observation made in this award consequently in this behalf is incorrect. This however does not materially affect the award adversely for the reason that, as will presently appear, the transfer has been found to be bad in law on other grounds though it has been held that there is no proof of victimisation or of hostile pick and choose. 6. The other contention of the learned counsel is that transfer of workmen from one factory to another is implied right of the petitioner in capacity as the employer. It is difficult to subscribe to this as an abstract proposition. Admittedly, there were three distinct registered factories situate at three different places owned by the company. The standing orders are silent in the matter of transfer of workmen from one factory to another. In the order of appointment relating to the concerned workmen it is undisputed. There was no mention at all to the effect that their services were liable to be transferred from the Mirzapur factory to another factory. It was argued that on the initial appointment there was no express earmarking of the workman to this particular factory. Nonetheless there was no indication given to the workmen in any shape or form prior to the general notice dated July, 20, 1979 that transfer from Mirzapur factory to another factory shall form part of the conditions of employment; ever since the workmen joined they worked at the Mirzapur factory. Nonetheless there was no indication given to the workmen in any shape or form prior to the general notice dated July, 20, 1979 that transfer from Mirzapur factory to another factory shall form part of the conditions of employment; ever since the workmen joined they worked at the Mirzapur factory. The factories elsewhere were run by different sets of employees; there existed adequate justifiable basis for the understanding impliedly, though not expressly denoted, that there were workmen scheduled for the specific concern wherein they were appointed. In fact on the petitioner's own showing before the crisis allegedly arose in the Mirzapur factory in or about 1978-79, the employer themselves did not have in contemplation the shifting of this lot of workmen to a different factory. The Gopepur factory, it may be emphasised, is not a branch of the Mirzapur unit, the employer is common undoubtedly but that itself does not constitute the determining factor. The true contractual position is revealed, in my opinion, from the conduct of the parties right from the time the appointment was given in each case till the decision was taken on or about July 20, 1979 to make the transfer. It is not that transfer has been sought by the workmen : this is brought about without their consent. Upon the facts and circumstances of the instant case, it is clear to my mind that the petitioner had no right statutory or contractual to affect the transfer en masse. 7. There was a feeble attempt made before the Tribunal, it appears, to justify the transfer on the footing of alleged past practice. In paras 11 and 13 of the written statement filed by it, the petitioner claimed that its right in this behalf is made out by the past practice (Annexure 8). The burden evidently lay upon the petitioner to establish the existence of such practice. All that was done in this respect was to produce a list of 94 transfers affected during a course of as many as 32 years. The Tribunal has for cogent reasons discarded this list as of no worth. There was neither consistency nor any systematized regularity suggested by this list. All that was done in this respect was to produce a list of 94 transfers affected during a course of as many as 32 years. The Tribunal has for cogent reasons discarded this list as of no worth. There was neither consistency nor any systematized regularity suggested by this list. Notice was made pointedly of the fact that it did not mention the dates/year of transfer it pertained to different branches - the cases of shifting from the Mirzapur factory being very few; there was no disclosure of the circumstances in the background whereof those transfers were done. The petitioner advisedly refrained from filing the list in this Court. By no standard could these sporadic acts of transfer spread over such long span be taken to prove a common practice. 8. From the authorities I do not find it laid down that in the field of industrial jurisprudence the right to transfer a workman from one factory to another be treated as implicit. There is, it will appear, no recognition given to such right as an abstract proposition divorced from the facts and circumstances of each case. The decision in Kundun Sugar Mills v. Ziauddin AIR 1960 SC 650 on which both sides rely throws a flood of light on this controversy. The argument advanced was that the right to transfer an employee by an employer from one of his concerns to another is implicit in every contract of service. The Supreme Court took note of the fact that though the same persons owned both the Mills they were two different concerns. The only connection between the two was, as in the case before us, the identity of ownership and, but for it, one had nothing to do with the other. The two mills were situate at different places with accounts separately maintained and governed by different service conditions, though they happened to be under the common management; therefore, they were treated as two different entities. The decision reached by the Supreme Court as stated in para 4 of the report was :- The question of law raised in this case must be considered in relation to the said facts. The argument of the learned counsel for the appellant that the right to transfer is implicit in every contract of service is too wide the mark. The decision reached by the Supreme Court as stated in para 4 of the report was :- The question of law raised in this case must be considered in relation to the said facts. The argument of the learned counsel for the appellant that the right to transfer is implicit in every contract of service is too wide the mark. Apart from any statutory provision, the rights of an employer and an employee are governed by the terms of contracts between them or by the terms necessarily implied therefrom. It is conceded that there is no express agreement between the appellant and the respondents where under the appellant has the right to transfer the respondents to any of its concerns in any place and the respondents, the duty to join the concerns to which they may be transferred. If so, can it be said that such a term has to be necessarily implied between the parties when the respondents 1 to 4 were employed by the appellant, the latter was running only one factory at Amrohe. There is nothing on record to indicate that at that time it was intended to purchase factories at other places or to extend its activities in the same line at different places. It is also not suggested that even if the appellant had such an intention, the respondents 1 to 4 had knowledge of the same. Under such circumstances, without more, it would not be right to imply any such term between the contracting parties when the idea of starting new factories at different places was not in contemplation. Ordinarily the employees would have agreed only to serve in the factory then in existence and the employer would have employed them only in respect of that factory. The matter does not stop there. In the instant case, as we have indicated, the two factories are distinct entities, situate at different places and, to import a term conferring a right on the employer to transfer respondents 1 to 4 to a different concern is really to make a new contract between them." 9. The existence of inherent right in every employer to transfer his employee to another place was not upheld. The existence of inherent right in every employer to transfer his employee to another place was not upheld. It is true, as urged for the petitioner, that therein the transfer directed was to a new mill not in existence at the time of the appointment, but the ratio underlying is that, such a term may not be necessarily implied between the parties in a case where the entities are distinct and transfer from one to another might not possibly have been in contemplation when the employees agreed to serve in a particular factory. And it is this which in my view governs the present case. 10. The distinction which their Lordships in Kundan Sugar Mills ( AIR 1960 SC 650 ) (supra) drew from other decisions is also instructive in this behalf. The case in Alexandre Bouzourou v. Otteman Bank AIR 1930 PC 118 was distinguished on ground that there the Bank with its branches was one unit and the records clearly indicated that transfer was one of the ordinary incidents of service in the Bank. This applies equally in relation to Syndicate Bank Ltd. v. Its Workmen (1966) 1 Lab LJ 440 : ( AIR 1966 SC 1283 ) and Canara Banking Corporation Ltd. v. Vittal (1963) 2 Lab LJ 354(SC)(cited before me. In both these cases the principle laid was that the Bank Management was in the best position to judge how to distribute its employees between the different branches. The case in (1956) 1 Lab LJ 343 (LATI - Mad) was distinguished as in that case labour was recruited in the plantations without any differentiation being made between factory and field workers and it had been the common practice prevailing for several years to transfer the factory workers to the field and vice versa. In S. N. Mukherjee v. Kemp and Co. Ltd. 1954 Lab AC 903 (Bom) also the decision rested on assumption that the business was one unit with branches in different places. The instant being not a case of transfer to a branch of the principal unit, this stands on different footing. 11. In S. N. Mukherjee v. Kemp and Co. Ltd. 1954 Lab AC 903 (Bom) also the decision rested on assumption that the business was one unit with branches in different places. The instant being not a case of transfer to a branch of the principal unit, this stands on different footing. 11. In Management of Hotel Imperial, New Delhi v. Hotel Workers' Union, AIR 1959 SC 1342 in a case of suspension of workman it was said by Wanchoo, J. as he then was delivering the judgment on behalf of the Court : Ordinarily, therefore the absence of such power either asan express terms in the contract or in the rules framed under same statute would mean that the master would have no power to suspend a workman and even if he does so in the sense that he forbids the employees to work he will have to pay wages during the so-called period of suspension. Where, however, there is power to suspend either in the contract of employment or in the statute or the rules framed thereunder, the suspension has the effect of temporarily suspending the relation of master and servant with the consequence that the servant is not bound to render service and the master is not bound to pay". 12. The same principle was reiterated in V. P. Gindroniya v. State of Madhya Pradesh, (1970) 1 SCC 362 : (1970 Lab IC 1332) and it was adopted with approval in a case of lay off (Workmen of Firestone Tyre & Rubber Co. of India (P) Ltd., (1976) 3 SCC 819 : (1976 Lab IC 1154)). 13. Learned counsel also cited to his aid an award of the Labour Court, Madras reported in (1960) 2 LLJ 125 (Workmen of Philips (India) Ltd. v. Philips (India) Ltd.). It was observed at page 136 that in cases where the conditions of service have been reduced to writing and they do not contain provisions dealing with transfers or where there are no standing orders or any Other instrument dealing with service conditions liability to be transferred from one place of establishment to another at a different place by the employer or at his instance is an incident of service, that is to say, an implied condition of service and the workmen concerned cannot successfully complain unless he can show that transfer was made by way of punishment. This no doubt supports the submissions made for the petitioner but it is worthy of note that that pertained to an all India organisation claiming right to require its employees to work at such places where it was found more suitable and further the Labour Court giving its award on Dec. 31, 1959 did not have the benefit of the Supreme Court decision in Kundan Sugar Mills, ( AIR 1960 SC 650 ) (supra) dated 9th February, 1960. 14. Upon the finding, therefore, that the petitioner did not establish right to transfer statutory or contractual (express or implied), as found by the Tribunal, the question next to be considered under the terms of the reference was of relief admissible to the workmen. It is argued that the Tribunal may have in such a case nullified the transfer instead of directing payment at the rate of Rs. 5/- per day as conveyance/travelling allowance. On careful consideration I find that the Tribunal has adopted a rational approach. In pursuance to the order of transfer, the workmen had joined their duties on March 6, 1980 acting on the faith of the assurance extended to them by the petitioner in writing dated 5-3-1980 to arrange for transport by bus, or, in the alternative, to pay Rs. 4/- per day against this item. The Mirzapur unit no longer remained a factory and was almost closed down. In such situation to ask the workmen to revert back to Mirzapur would not have been in the interest of either of the parties. The submission then made is that there is no evidence that these 44 workmen reside in Mirzapur and would have, therefore, to travel to Gopupura every day, and, that as appearing from Para 7 of the letter dated 5-3-80 (Annexure 4) extracted above, the offer made by the petitioner extended only up to the date of the award. There is no force in the contention. At no stage did the petitioner dispute that the concerned workmen reside ordinarily within the precincts of Mirzapur or that they shall not have to travel all the way and back each day to their new place of work. Nothing of the kind was asserted before the Conciliation Board or the Tribunal nor was evidence adduced to this effect. At no stage did the petitioner dispute that the concerned workmen reside ordinarily within the precincts of Mirzapur or that they shall not have to travel all the way and back each day to their new place of work. Nothing of the kind was asserted before the Conciliation Board or the Tribunal nor was evidence adduced to this effect. As to the second limb of the argument raised, the offer of the petitioner, dated 5-3-80 does not constitute the basis for the award impugned, it is taken legitimately as a guideline furnishing a reasonable solution. There was evidence independently thereof before the Tribunal to arrive at this finding. Admittedly there is no provision made for residential quarters for these workmen at the site. Hajrat one of the workmen examined before the Tribunal testified that the distance between Mirzapur to Gopiganj is 28 K.M. and that the bus charges are Rs. 2.40 while the tonga costs between Rs. 2.50/-, Rs. 3/- each way (Annexure 10 to the writ petition). Faced with all this the petitioner purchased peace initially by the offer ut. 5-3-1980 which was accepted and acted upon by the other side but later the petitioner chose to resile therefrom on 10th May, 1980 (Annexure 5) a conduct that tells its own story and needs no further comments. In the circumstances the approach adopted by the Tribunal in modulating the relief cannot, be classed as perverse or arbitrary. 15. Learned counsel argued also with some emphasis that the respondents may agree to retrenchment and that the petitioner is prepared to pay off the entire compensation on this score. When the matter was before the Tribunal there was it appears, such a suggestion for the workman but to this the petitioner did not respond. It is now over five years since the workmen were shifted and during this period they have naturally adjusted themselves to the new situation. Moreover, as the respondent's counsel submitted, the petitioner would require permission of the Labour Commissioner for the purpose and it is pointless at this stage to insist upon the respondents agreeing to be retrenched. 16. For the reasons discussed above, the writ petition is devoid of merit and is dismissed. No. 3 shall be entitled to their costs.