March 16 v. SUTI MILL MAZDOOR UNION & Ors.

BHAG\l'A1'I J.-This is an appeal by special leave from a decision of the [Jabour Appellate Tribunal of India, Calcutta, confirming an award made by the Regional Conciliation· Board (Textiles & Hosiery), Kanpur, in an industrial dispute between the appel- lants and the respondents, · s.c.R. SUPREME OOLiRT REPOR'rs 781 l d 3 h' l and Othm. Bhay11)ati J. 1953 - Athsrton West <l) 0 Ltd ".. · Si.ti Mill The' respondents 2. 3 and 4 were employees of the respondent 2 was employed appellants, d 4 d 1 ' c enca ca re w 1 e respon ents , an were em- ployed as wrapping boy and piecer respectively and their service conditions were governed by the stand- ing orders of the Employers' Association of Northern l1fozdoor Union India, Kanpur, of which association the appellants were members. · There was a theft in the canteen within the mill premises between the night of January 6 and 7, 1950, and some money belonging to the appellants invested iu the canteen account was stolen from the safe. A report of the theft was made to the police authorities and an investigation was made by the police as well as the appellants in the matter with no result. The management of the appellants thereafter took action against one J. P. Gurjar, who was in charge of the canteen in connection with the losses of money from the account of the canteen and after the completion of the enquiries terminated his services. An indus- trial dispute in respect of the non-employment of the said .J. P. Gurjar arose between the parties which dis- pute was at the material time taken in appeal before the Industrial Court (Textiles & Hosiery), Kanpur. During the pendency of those proceedings, some time in August, 1950, the respondent 4 made a confession in regard to the said theft implicating the respond- ents 2 and 3 also therein. On the 29th August, 1950, the management of the appellants presented to the respondents 2, 3 and 4 c]large-sheets in respect of the 30th the said theft and suspended them on August, 1950, from their senice. They also made an application on the 2nd September, 1950, to the Addi- tional Regional Conciliation Officer, Kanpur, asking for permission to dismiss the respondents 2, 3 and 4. 'rhe Additional Regional Conciliation Officer, Kanpur, instituted an enquiry, heard the respondents 2, 3 and 4, considered the evidence which was led before him by the appellants as well as the respondents 2, 3 and 4 and made an order on the 12th October, 1950, according to the appellantA permission for the dismisrnl of the ·782 SUPREME COURT REPOR'fS [i953J 1953 respondents 2, 3 and 4. The respondel'lts 2, 3 and 4 Ath t-w t , were accordingly dismissed from _their employ bv the appell:a.nts with effect from the 13th October, 1950. er on co. Ltd. es u. .. • Maz oor nion • . v. ' vfu,u An industrial dispute thereupon arose between the appellants and respondents 2, 3 and 4 in respect of the d d an respon - ent l, a registered trade union, of which the respond 8a"1 a dOth•,.,. non-employmentot respon ents2,3au n Bhagwoti J. en ts 2, 3 and 4 were . members, ultimately-moved the_ Regional Conciliation Board ('11extiles and Hosiery), Kanpur, ou the 1st November, 1950, challenging the propriety and bona fides of the appellants in termina ting the services of respondents 2, 3 and 4. d 4 d The appellants filed their written statement on the 25th November, 1950, contending inter alia that the dismissal was fully justified, regular and proper, having been made in accordance with the permission accord ed by the Additional Regional Conciliation Officer. 'fhe only issue which was canvassed before Regional Conciliation Board was whether any or all of the three workmen named in the application dated the 1st November, 1950, hits/have been wrongfully dismissed and if so, to what relief is he/they entitled. The Board consisted of three members, Shri R. P. Maheshwari, CJiairman, and Shri B. B. Singh and Shri J. K. Bhagat, Members. Shri J. K. Bhagat was not present on the last date of the hearing and the award was therefore signed on the 20th April, 1951, by Shri R. P. Maheshwari and Shri B. B. Singh. Under the terms of the award the Board held that the dismissal was wron.~ful and that the respondents 2, 3 and 4 were entitled to reinstatement as also to the full wages, including dearness allowance from the date of their suspension to the date they were taken back on duty. The appellants preferred an appeal to the Labour Appellate 'l'ribunal of India, Calcutta. The appeal was heard on the 16th August, 1951, and the Labour the appeal of the Appellate Tribunal dismissed appellants. The appellants obtained special leave from this Court and filed the present appeal. S.C.R. SUPREME COURT REPORTS 783 · d · d d · . h woB - Athe..ton West .t Co. Ltd. v. Snti Mill Two conte:etions were urged by Shri C. K. Daph- tary who appeared for the appellants before us-(1) · h an moperat1ve as it was t at t e a.war was vo1 made by only two members of the Board, the third, member, Shri J. K. Bhagat not having been present at the last hearing and not having signed the same Mazdoor Union and (2) that the Additional Regional Conciliation Officer having given the written permission for dis- missal of repondents 2, 3 and 4 no industrial dispute could arise by reason of the non-employment of res- pondents 2, 3 and 4 and the Regional Conciliation Board had therefore no jurisdiction to entertain the application made before it by respondent 1 on behalf of the respondents 2, 3 and 4 and the award of the Regional Conciliation Board ordering the reinstate- ment of respondents 2, 3 and 4 was therefore without jurisdiction, void and inoperative and the Labour Appellate Tribunal was in error in confirming the same. BhagwatiJ. and Others. In support of his first contention Shri C. K. Daph tary relied upon clause 4 and ·clause 7, sub-clause (3) of the G. N. No. 781 (L)/XVIII, dated 10th March, 1948, issued by the United Provinces Government regarding the constitution of Regional Conciliation Boards and Industrial Courts for the settlement of industrial disputes within the State. Clause 4-" No business may be transacted at any meeting of any Board unless all the three members are present 'I. Clause 7 (3)-" Where no amicable settlement can be reached on one or more issues the Board, if all the members thereof agree or if they do not so agree, the majority of the members agreeing or if no two mem bers agree, the Chairman alone, shall record an award and the reasons for such award, on the issues on which the parties were unable to reach an amicable settlement." Shri C. K. Daphtuy therefore urged that Shri J. K. Bhagat not having been present at the last meeting of the Board and not having signed the 784 SUPREME COURT REPORTS [1953] 0 19sa - - award the award could not be lawfully made by the Chairman and the other member who were present Atherto•~~est & and who signed the award and the award was therefore Shri c._ P. Varma who void and represented the respondent 1 before us however drew Mazdoo,. Unioii our attention to the Government Order No. 388(11)/ and Others. XVIII/37 (LL) /50 dated 2nd March, 1051, which \ . . suti Mill inoperative. Bhagwati J. amended the abol'e clauses 4 and 7(3). Clause 4 as amended provides:- " (1) Notice of every meeting of the Board shall be , given to the members by the ChairmBn in advance. (2) If apart from the Chairman either or both the other members fail to attend any meeting of the Board of which notice has been given to them, the Chairman may transact the business of the Board without the presence of the absent member or mem bers; and no such business or proceedings of the Board shall be held invalid merely by reason of the fact that either one or both of the members were not present at the meeting." Clause 7 (3) as amended provides: - "Where no amicable settlement can be reached on one or more issues, if all the members present agree the Board or if they do not so agree the majority of the members agreeing or if no two rnembero present agree or if only the Chairman is present, he alone, shall record an ·award and the reasons for such award on the issues on which the parties were unable to reach an amicable settlement." ' 'fhese amendments in the 'clauses 4 and 7 (3) are enough in onr opinion to repel the contention of Shri C. K. Daphtary that the absence of Shri J. K. Bhagat from the last meeting and also his non-parti cipation in the making and signing of the award rendered the award void and inoperatiYe. 'l'he Board was empowered under the amended clauses 4 and 7(3) to act in the absence of Shri J. R. Bhagat and the award 11s it was made and signed by the two remain ing members, viz., Sbri R. P. Maheshwari and Shri B. B. Singh, was lawful and binding on the partie~. S.C.R. SUPREME COURT REPORTS 785 In support· of his second contention Shri C. K. 1968 Daphtary relied upon clauses 23 and 24 of the Govern-A'h -m • ei·ton '"st <! N ment ot1 cat10n ated the 10th March, 1948, above 00• Ltd. referred to. v. 'fi d · · . 0"" ] C h A ' eg10na 111cer or t e ']' onm iat1on Clause 23 :-" Sa,ve with the written permission of " Sduti Mum maz oor nion th R e ss1Stant and Others. Regional Conciliation Officer concerned irrespective of the fact whether an enquiry is pending before a Regio-nal Conciliation Hoard or the Provincial Con- ciliation 13oara or an appeal has been filed before the Industrial Court, no employer, his agent or manager, shall discharge or dismiss any workmen during the continuance of an enquiry or appeal and pending the· issue of the orders of the State Government upon the findings of the said Court ......... " Bhagwati J. .. Clause 24 :-"(1) Except as hereinbefore provided every order made or direction issued under the provi sions of this Order shall be final and conclusive and shall not be questioned by any party thereto in any proceeding ......... " Shri C. K. Daphtary contended that the order made by the Additional Regional Conciliation Officer on the 12th October, 1950, giving the appellants permis sion to dismiss respondents 2, 3 and 4 was final and conclusive in regard to the appellants' right to dis their employ and their dismissal miss them from accordingly by the appellants could not be the founda tion of any industrial dispute which could be referred to the Regional Conciliation Board at the instance of respondent 1. He further contended that if no in dustrial dispute could thus arise the Regional Conci liation Board had no jurisdiction to entertain the same and the award made by the Board was therefore without jurisdiction, void and inoperative and could not also be con firmed by the T~abour Appellate Tribu nal. We are unable to accept this contention. The Government Notification dated 10th March, 1948, was issued by the Governor of the United Provinces in e)l:ercise of the powers conferred by cla, uses (b), (c), 786 SUPREME COURT REPORTS (1953] Athorton B · f . k suti Mill Co. Ltd. v. (d) and (g) of est provided for section 3 and section 8 of the Board. in which the Board for enquiry and 1953 -w & United Provinces Industrial Disputes Act, 1947. It the constitution by the Provincial b Government of such num er of Conciliation Boards as might be deemed necessary for the settlement of M•zdoor Union industrial disputes consisting of three members of .,.a Others. which one was to he the Conciliation Officer for the area; one was to be representative of the employers ' - t . J b h ,,agwa • • e t e representative o wor men, and one was to the area being the the Conciliation Officer '11he order provided .Chairman of industrial disputes may for the mode · be referred to manner in which the enquiry was to be conduc, ed. It also provided for the constitution by the Provincial Government of such number of Industrial Courts as it might be necessary consisting of a President assisted by such equal number of assessors as the .President might determine representing employers and em ployees. Provision was made for appeals to such Industrial Courts from the awards of the Board and also for the hearing of the said appeals. After mak ing further provision for the procedure to be adopted before the Boards as well a.s the Industrial Courts, the Order by clause 23. above mentioned imposed a ban ou the discli.arge or dismissal of any workman by the employer, his agent or manager during the pe':l. dency of an enquir1' before the Regional Conciliation Board or the Provincial Conciliation Board or of an . appeal before the Industrial Court except with the written permission of the Regional Conciliation Offi cer or the Assistant Regional Conciliation Officer concerned and by clause 24 made every order or direction issued under the provisions of the said Government Order final and conclusive except as thereinbefore provided. It is clear that clause 23 imposed a ban on the dis charge or dismissal of any workman pending the en quiry of an industrial dispute before the Board or an appeal before the Industrial Court and the employer, his agent or manager could only discharge or dismiss ' S.C.R. SUPREME COURT REPOR'fS 787 11 ~ - _ 1 est ~ 00• Ltd. v. Suti Mill 41 . 1968 Offi 1 C d E h. /<Cr on cer concerne . · 1 · onc1 1at10n to remove the ban the workman with the written permission of the Regional Conciliation Officer or the Assistant Regio- . f ven 1 sue written permission was forthcoming the employer, his agent or manager might or might not discharge or dismiss the workman and the only effect of such Mazdoor Union written permission would be and Others. against the discharge or dismissal of the workman Bhagwati J. during the pendency of those proceedings. The Re- gional Conciliation Officer or the Assistant Hegional Conciliation Officer concerned would institute an en- quiry and come to the conclusion whether there was a prima facie case made out for the discharge or dis- miss:i.l of the workman and the employer, his agent or manager was not actuated by any improper motives or did not resort to any unfair practice or victimisa- tion in the matter of the proposed discharge or dis- miss9'1 of the workman. But he was not entrusted, as the Board or the Industrial Court would be, with the duty of coming to the conclusion whether the dis- charge or dismissal of the workman during pendency of the proceedings was within the rights of the employer, his agent or manager. The enquiry to be conducted by the Regional Conciliation Offi~er or the Assistant Regional Conciliation Officer concerned was not an enquiry into an industrial dispute as to the non-employment of the workman who was sought to be discharged or dismissed, which industrial dispute would only arise after an employer, his agent or manager discharged or dismissed the workman in ac- cordance with the written permission obtained from the officer concerned. l'his was the only scope of the enquiry before the Regional Conciliation Officer or the Assistant Regional Conciliation Officer concerned and the effect of the written permission was not to validate the discharge or dismissal but merely to re- move the ban on the powers of the employer, his agent or manager to discharge or dismiss the work- man during the pendency of the proceedings. Once such written permission wa,s granted by him, tha,t 10• ., 788 SUPREME COURT REPORTS [1953] · l d' 'h 1953 - Atherton West ~ 00 . Ltd. v. Suti Mill order made or direction issued by him w.as to be final , and conclusive and was not to be questioned by any f party thereto Ill any procee mgs. 1 e on y e ect o clause 24(1) was to prevent any party to the pending proceedings from challenging the written permission Mazdoor Union thus granted by the officer concerned. Such written and Others. permission could not be made the subject-matter of Bhaawati J. any appeal at the instance of either party and both the parties would be bound by the order made or direction issued by the officer concerned so far as it gave or refused the permission to the employer, his agent or man11ger in the matter of the proposed dis charge or dismissal of the workman. This was the only scope of the provisions of clauses 23 and 24 (1) above mentioned. Once the written permission was granted by the officer concern ed, the ban against the discharge or dismissal of the workman would be removed and the employer, his agent or manager could in the exercise of his discre tion discharge or dismiss the workman but in that event an industrial dispute within the meaning of its definition contained in section 2(k) of the Industrial Disputes Act, 1947, would arise and the workmen who bad btlen discharged or dismissed would be entitled to have that industrial dispute referred to the Region:1l Conciliation Board for enquiry into the same. That right 9f the workman to raise an industrial dispute could not be taken away in the manner suggested by Shri C. K. Daphtary by having resort to the provi sions of clauses 23 and 24(1) aforesaid. That right \1:as given to the workman by the terms of the Industrial Disputes Act, 1947, and the U.P. Industrial Disputes Act, XXVIII of 1947, and woulii remain un affected by any of the provisions hereinbefore referred to. We are therefore of the opinion that this conten tion of Sbri C. K. Daphtary also fails. \Ve may before concluding advert to one circum stance and that is that even though the Labour App111late Tribunal rightly confined its jurisdicti•m to S.C.R. SUPREME COURT REPORTS 789 . 1958 determining substantial questions of law involved in the appeal, it nevertheless observed that even on the Atl t -w t , es °' f :octs the conclus10ns of the Board were perfectly justified and there was no substance in the appeal on merits as well. The appellants were not heard at all on merits and it was hardly legitimate for the Labour M•zdoor Union Appellate Tribunal sito motu to consider the merits of •nd Others. the appeal and arrive at a finding in regard to the Bhagwati J. If at all the Labour Appellate Tribunal had same. any jurisdiction in regard to the merits it was incum- beut upon it to have heard the appellants in regard to the merits before arriving at a conclusion in regard to the same. ier on 00 . Ltd. v. suti Mill •. The resuH is that this appeal fails and must be dis missed with costs. Appeal dismissed . • Agent for the appellant : S. S. Shukla .. 'rROJAN & CO. LTD. v. RM. N. N. NAGAPPA CHETTIAR. [MEHR CHAND MAHA.TAN and DAS JJ.] 1953 Contract-Damages-Sale of shares-Sale induced by fra11d Jleas11re of damages-Di(ference between price paid and market price on date of sale-Fluctuations of market and sudden closure of Stock Exchange, effect of-Interest on damaues-Practice-Gonflict between pleadings and proof-Decree on alternative claim not set itp in plaint-Legality. Where a person is induced to l)Urchase shares at a certain price by fraud the measure of damages which he is entitled to re· cover from the seller is the difference between the price which he paid for the shares and the real price of the shares on the date on which the shares were purchased. Ordinarily the m"rket rate of the shares on the elate when the fraud was practised would re present their real price in tbe absence of any other circumstance. If, however, the market was vitiated or was in a state of !lux or