The Management of Ultramarine and Pigments Ltd.,25-B SIPCOT,Ranipet v. The Presiding Officer,Labour Court, Vellore

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 18-8-2009CORAMTHE HONOURABLE MR. JUSTICE N. PAUL VASANTHAKUMARWRIT PETITION NO.7879 OF 2001The Management of Ultramarine and Pigments Ltd.,25-B SIPCOT,Ranipet....PetitionerVs.1.The Presiding Officer,Labour Court, Vellore.2.R. Narasimhan...RespondentsWrit Petition filed under Article 226 of the Constitution ofIndia praying for the issuance of a Writ of Certiorari calling forthe records of the first respondent in I.D.No.431/94 and quash theaward dated 4.1.2001.For Petitioners : Mr.Ravifor M/s.T.S.Gopalan & Co.,1st Respondent:Labour CourtFor 2nd Respondent: Mr.R.RajaramO R D E RThe prayer in this writ petition is to quash the award made inI.D.No.431 of 1994 dated 4.1.2001 on the file of the Labour Court,Vellore.2.The case of the petitioner-management as could be seen fromthe affidavit in support of the writ petition are as follows:(a)The second respondent was employed as Supervisor in thepetitioner Soap Factory at Ranipet. During April, 1999, themanagement placed orders with the manufacturers at Mumbai for supplyof certain machineries in connection with the expansion of themanufacturing activities at Ranipet. According to the petitioner,the second respondent was involved in various manufacturing https://hcservices.ecourts.gov.in/hcservices/ activities in the factory and in order to ensure proper execution ofthe work order given to the manufacturer at Mumbai, and also tosurvey and inspect the machineries, the management decided to sendcompetent technicians to Mumbai for certain period.(b)The second respondent and two others were found fit for theabove job and on 2.8.1994 they were issued with orders deputing themto Mumbai. The second respondent was required to report before thepetitioner's Mumbai office Manager on or before 8.8.1994.(c)It is claimed in the affidavit that the second respondentrefused to accept the said order and sent a letter on 8.8.1994 bystating that he was working in the factory at Ranipet for the pastseven years and as per the Model Standing Orders, there was noprovision to transfer employees like him, who are paid consolidatedsalary and it is not possible for him to maintain his family atRanipet, while staying at Mumbai and therefore he requested to posthim at Rnipet itself.(d)The management sent a reply stating that as per clause 6 ofthe order of appointment, the second respondent is liable fortransfer anywhere in India and the second respondent was sent for thepurpose of inspection and survey the equipments and directed thesecond respondent to report at Mumbai.(e)Again, the second respondent sent a letter on 16.8.1994 andobjected the said transfer and requested to permit him to work atRanipet. On 20.8.1994, the management once again directed the secondrespondent to report at Mumbai, failing which he would be liable fordisciplinary action.(f)The second respondent having not reported for duty atMumbai, a show cause notice was issued on 23.8.1994, calling upon thesecond respondent as to why he should not be dismissed from servicefor his refusal to attend to work at Mumbai. The second respondentsent a reply on 29.8.1994 and reiterated his stand. As the secondrespondent refused to obey the transfer order, on 30.8.1994 he wasdischarged from service. The second respondent raised I.D.No.431 of1994 before the first respondent by contending that he was victimisedfor his Trade Union activities and prayed for reinstatement withbackwages and continuity of service. The management filed counterstatement and denied the same. 3.Before the Labour Court, the second respondent examinedhimself as a witness and marked 26 exhibits on his side. On behalfof the management, the then Works Manager was examined as MW-1 andExs.M-1 to M-53 were marked. The Labour Court, by award dated4.1.2001, directed the petitioner management to reinstate the secondrespondent with backwages and continuity of service with cost ofRs.1,000/-. https://hcservices.ecourts.gov.in/hcservices/

4.The said award passed by the first respondent-Labour Courtis challenged in this writ petition on the ground that theappointment order given to the second respondent empowers themanagement to transfer him and the second respondent having failed toobey the transfer order, he was discharged from service. It is alsocontended in the affidavit that transfer being an incidence ofservice and the management having discharged the second respondentfor disobedience of the transfer order, the Labour Court was notjustified in setting aside the said order and ordering reinstatementwith all benefits.5.The learned counsel for the management during the course ofthe arguments submitted that he is not pressing the first issueraised before the Labour Court with regard to the maintainability ofthe Industrial Dispute and the second respondent can be treated as aWorkman as he was not having any managerial/administrative powers.The said submission made by the learned counsel for the management isrecorded. Insofar as the other issue as to whether the secondrespondent can be transferred to any other place and the saidtransfer power having been vested with the management in terms of theappointment order and the second respondent having been deputed toMumbai and the said order having not been obeyed, the management wasleft with no option except to discharge the second respondent'sservice. The learned counsel also submitted that there is novictimisation and therefore the interference made by the Labour Courton that ground is perverse and the same can be interfered with bythis Court. The learned counsel for the petitioner management madean alternate submission to award compensation in case this Courtfinds that the order of the Labour Court is sustainable.6.The learned counsel for the second respondent submittedthat on 8.5.1995 the Union was formed and the second respondent waselected as Executive Member of the Union and he being a low paidemployee, namely Shift Supervisor, was ordered to be transferred toMumbai due to his Union activities along with three other persons.The learned counsel further submitted that one person who wastransferred to Mumbai, on being resigned from the Union membership,was retained at Ranipet. The learned counsel also submitted that thesecond respondent was not competent to inspect the machineries to bepurchased by the management as he is only a B.Sc. Chemistry graduateand was given training only in mixing of chemicals for themanufacture of soaps/surf and the Ranipet factory is manufacturingSunlight Bar Soap and Vim Bar soap and Surf/Vim powder for the multi-national company called 'Hindustan Lever' and that he has notechnical expertise to find out the working of the machineries, etc.Insofar as the contention of the management that the order oftransfer was temporary and for a limited period, it was argued thatno period is mentioned in the transfer order and no special allowancewas also sanctioned. According to the learned counsel, the LabourCourt found that there was victimisation on the part of the https://hcservices.ecourts.gov.in/hcservices/ management and without conducting any enquiry, the second respondentwas discharged from service, and taking note of the above facts theaward was passed in favour of the second respondent and there is noperversity in the said findings.7.I have considered the rival submissions of the learnedcounsel for the petitioner as well as second respondent.8.The second respondent was appointed in the petitioner SoapManufacturing Company by order dated 14.7.1988 and he was designatedas Packing Supervisor. In the order of appointment it is stated thatthe second respondent agreed to serve in any of the petitioner'ssister concern/branches/subsidiaries within the territory of India.Even according to the petitioner-management, there is no branch orsubsidiary office available at Mumbai to manufacture soap ordetergent, for posting the second respondent as Packing Supervisor.9.The reason stated for transferring the second respondentwas to survey the equipments under manufacture by the suppliers. Itis the specific case of the second respondent that he being a B.ScChemistry graduate, was trained only for the manufacture of soapsi.e., mixing of chemicals and he is not well-versed or trained toinspect and survey the equipments/machineries.10.It is not in dispute that he became the Executive Committeemember of the newly formed Trade Union, which was formed on 8.5.1994.Ex.W-6 was marked by the second respondent to prove the same. TheOffice bearers of the Trade Union viz., the second respondent and twoothers were transferred/deputed to Mumbai office. It is admitted bythe management witness No.1 during cross-examination deposed that thesecond respondent and two others were deputed/transferred and all thethree persons failed to report for duty at Mumbai. One P.Sivakumar,who was also deputed to Mumbai, on being resigned from the membershipof the Union, was allowed to serve at Ranipet. The second respondenthas filed Ex.W-4 dated 8.5.1994 in support of his contention that theEmployees' Union was formed and a resolution copy has been marked.The learned counsel for the petitioner management submitted that inthe transfer order, the second respondent was offered special pay,however, the transfer order dated 2.8.1994 which is marked as Ex.M-11nowhere states that special pay is ordered to the second respondent,while he was ordered to report for duty before the Mumbai OfficeManager. The only thing stated in the said order is that he cancollect advance of Rs.450/- for travelling and other expenses onsuspense account. Thus, the contention raised by the managementstating that the second respondent was offered additional or specialpay, while he was deputed to Mumbai office is untenable. Admittedly,the second respondent was paid a sum of Rs.1,400/- per month and hehas expressed his inability to reside at Mumbai, while retaining hisfamily at Ranipet. https://hcservices.ecourts.gov.in/hcservices/

11.It is also claimed by the petitioner management that thedeputation/transfer was for a limited period. From the perusal of thetransfer order dated 2.8.1994 (Ex.M-11), it is clear the period ofdeputation/transfer is not mentioned. For proper appreciation, thetransfer order dated 2.8.1994 is extracted hereunder,"ULIRAMARINE & PIGMENTS LIMITED,MANUFACTURERS OF DETERGENTS & ULTRAMARINE BLUE2.8.94Mr.R.NarasimhanJunior Shift SupervisorWe understand from our suppliers at Bombay thatthe equipments for which we have placed orders aregetting ready and they have advised us to makearrangements for stage by stage inspection of theequipments. We have decided to depute the three ofyour viz. (1) Mr.B.Sivakumar, (2) Mr.G.T.Sivakumar (3)Mr.R.Narasimhan, to Bombay to inspect and survey theequipments under manufacture and fabrication by oursuppliers. Further instructions in this regard willbe given to your by our Bombay office when your reportthere.You are requuired to report to our Bombay officeManager Mr.V.R.Manohar, on or before 8.8.94. In viewof this, you may collect your advances from thecompany and get relieved on Wednesday the 3rd August,94. Each of you may collect Rs.450/- for yourtravelling and other expenses on suspense account.You may render proper account to our Bombay office."It is not disputed by the management that M/s.B.Sivakumar,G.T.Sivakumar and the second respondent herein weretransferred/deputed to Mumbai and all the above persons are membersof the Union. Admittedly no other non-member of the Union have beendeputed/transferred to Mumbai. 12.Taking note of the above undisputed facts, the Labour Courtrecorded its findings that there is victimisation by the managementand the second respondent was discharged from service with undulyhaste with clear determination of mind, without conducting anyenquiry. The Labour Court also found that compensation in lieu ofreinstatement will not be the adequate relief as it will give wrongsignal to other employers to victimise their employees. The LabourCourt also found that the second respondent proved that he was notgainfully employed during his non-employment period and consequentlyordered reinstatement with backwages and continuity of service. https://hcservices.ecourts.gov.in/hcservices/ There is no perversity in the findings given by the Labour Court,warranting interference under Article 226 of the Constitution ofIndia.13.The contention of the learned counsel for the petitioner-management that the second respondent having been appointed in atransferable post, is bound to report for duty at Mumbai, when he wasgiven order of transfer/deputation. The Labour Court gave a findingthat the Mumbai Office may not be a branch office as there was nomanufacturing process carried on, and it is only an administrativeoffice and therefore the second respondent, who was selected asPacking Supervisor, has no duty to perform in the administrativeoffice at Mumbai.14.Though transfer is an incidence of service, taking intoconsideration the facts and circumstances of this case, where thereis no manufacturing process carried on at Mumbai, the transfer orderissued to the second respondent cannot be treated as an order oftransfer simplicitor. The management also cannot sustain the orderon the ground of exigency in service, particularly, when it isestablished before the Labour Court that only three persons, whobecame office bearers of the Union alone were transferred to Mumbaiadministrative office. 15.The alternate submission made by the learned counsel forthe petitioner-management that the second respondent may be given alumpsum in lieu of reinstatement also cannot be sustained in view ofthe fact that the second respondent has not involved in anymisappropriation or committed any delinquency and thereby themanagement lost its confidence on him. In the counter statementfiled before the Labour Court, though a plea is raised that themanagement had lost confidence on the second respondent, the saidplea was not proved by any acceptable evidence before the LabourCourt and the Labour Court having came to the conclusion that thereis victimisation on the part of the management, as rightly observedby the Labour Court, if the alternate plea of compensation in lieu ofreinstatement is ordered, it will give wrong signal to themanagements to discharge/dismiss their employees, who are genuinelyventilating their grievance to get their statutory rights andbenefits according to the Labour Welfare Legislations.16.In the decision reported in (1975) 1 SCC 574 : 1975 (1) LLJ262 (L.Michael v. M/s.Johnson Pumps India Ltd.) in paragraphs 19, 21and 22 (in SCC) it is held thus,"19................. The law is simplythis: The Tribunal has the power and, indeed, theduty to X-ray the order and discover its truenature, if the object and effect, if the attendantcircumstances and the ulterior purpose be to https://hcservices.ecourts.gov.in/hcservices/ dismiss the employee because he is an evil to beeliminated. But if the management, to cover up theinability to establish by an enquiry,illegitimately but ingeniously passes an innocent-looking order of termination simpliciter, suchaction is bad and is liable to be set aside. Lossof confidence is no new armour for the management;otherwise security of tenure, ensured by the newindustrial jurisprudence and authenticated by acatena of cases of this Court, can be subverted bythis neo-formula. Loss of confidence in the lawwill be the consequence of the Loss of Confidencedoctrine.20.......................................21.................. We are constrainedto express ourselves unmistakably lest industrialunrest induced by wrongful terminations based onconvenient loss of confidence should be generated.22. Before we conclude we would like to addthat an employer who believes or suspects that hisemployee, particularly one holding a position ofconfidence, has betrayed that confidence, can, ifthe conditions and terms of the employment permit,terminate his employment and discharge him withoutany stigma attaching to the discharge. But suchbelief or suspicion of the employer should not bea mere whim or fancy. It should be bona fide andreasonable. It must rest on some tangible basisand the power has to be exercised by the employerobjectively, in good faith, which means honestlywith due care and prudence. If the exercise ofsuch power is challenged on the ground of beingcolourable or mala fide or an act of victimisationor unfair labour practice, the employer mustdisclose to the Court the grounds of his impugnedaction so that the same may be tested judicially."In the decision reported in (2001) 9 SCC 609 (Kanhaiyalal Agrawal v.Factory Manager, Gwalior Sugar Co. Ltd.) the question with regard toloss of confidence by employee was considered. In paragraph 9 it isheld as follows:"9. Substantial contention on the merits ofthe case by the employer in these appeals is thatthe finding of loss of confidence in the employeeby the Labour Court has been reversed in appeal bythe Industrial Court on unreasonable grounds. Whatmust be pleaded and proved to invoke the aforesaid https://hcservices.ecourts.gov.in/hcservices/ principle is that (i) the workman is holding aposition of trust and confidence; (ii) by abusingsuch position, he commits acts which results inforfeiting the same; and (iii) to continue him inservice would be embarrassing and inconvenient tothe employer or would be detrimental to thediscipline or security of the establishment. Allthese three aspects must be present to refusereinstatement on the ground of loss of confidence.Loss of confidence cannot be subjective based uponthe mind of the management. Objective facts whichwould lead to a definite inference of apprehensionin the mind of the management regardingtrustworthiness or reliability of the employeemust be alleged and proved. Else, the right ofreinstatement ordinarily available to the employeewill be lost."17.The plea raised by the learned counsel for the petitionerthat the second respondent was temporarily posted/deputed to Mumbaialso cannot be sustained in the absence of any such reason stated inthe order of transfer, which is extracted above.18.It is well settled in law that transfer order can beinterfered with only when any statutory violation or mala fide orvictimisation is proved. Here in this case, the victimisation isproved before the Labour Court and the management has also shownundue hasteness in discharging the second respondent, without evenconducting any enquiry by framing regular charges. The attempt madebefore the Labour Court to sustain the order of discharge was rightlyrejected by the Labour Court.19.On the basis of the above findings, I hold, no case is madeout to interfere in the award passed by the Labour Court, warrantinginterference.The writ petition is dismissed. No costs. vr Sd/- Asst.Registrar/True Copy/ Sub.Asst.Registrar https://hcservices.ecourts.gov.in/hcservices/ ToThe Presiding Officer, Labour Court, Vellore.+ 1 cc to T.S. Gopalan & Co, Sr.39347/09+ 1 cc to Mr. R.Rajaram, Advocate SR.39492/09.PRE-DELIVERY ORDER INW.P.No.7879 of 2001TM(CO)EU 31.8.2009.