CHANDRA TEXTILES PRIVATE LIMITED COIMBATORE Vs. N PALANISWAMI

JUDGEMENT

(1.) THE first respondent was employed as a Turner in the mechanical Section of the appellant's Mills. THE appellant framed four charges against the first respondent, and, after a domestic enquiry, dismissed him from service on 4th September, 1971. THE first respondent raised an industrial dispute which was referred for adjudication to the second respondent, and it was taken on file as I. S. No. 81 of 1972. THE Second respondent, without going into the merits of the case, rejected the claim of the first respondent by order dated 19th October, 1972 on the ground that the first respondent had not made a demand against the Management claiming reinstatement and that there was no industrial dispute. After making a demand, the first respondent raised a dispute against and it was referred to the second respondent for adjudication, by the Government on 23rd August, 1974, which was numbered as I. D. No. 79 of 1974. Against the reference, the appellant filed a writ petition in W. P. No. 3498 of 1974 in this Court, questioning the competence of the Government to make a reference in view of the earlier order of the second respondent. THE said writ petition was dismissed on 16th November, 1976. THEreafter, the second respondent considered the matter on merits and found that none of the charges framed by the Management was proved. It was also observed by the Second respondent in the Award that it was most inequitable and unjust for the management to have dismissed the first respondent from service. THE fact that other workmen similarly placed like the first respondent were reinstated by the management, was also referred to by the second respondent. However, while considering the relief to be granted to the first respondent, the second respondent refused to grant the relief of reinstatement on the ground that the first respondent was absent from service for a long time and that the management had to make consequential arrangements and that if the reinstatement was to be ordered, it would cause untold hardship to the Management. It is better to reproduce the relevant observation of the second respondent in its award; "in view of the long absence, naturaly, the management has to make consequential arrangements and therefore, if the petitioner, who has put in four years of service is now ordered to be reinstated after a lapse of about six years, certainly there will be untold hardship to the Management. " * THE second respondent ordered the appellant to pay a sum of Rs. 10, 000/- to the first respondent in lieu of reinstatement besides any amount lawfully due to the first respondent from the Management on account of gratuity, bonus, etc. Incidentally, it may be pointed out that in one sentence the second respondent refers to the sum of Rs. 10, 000/- as an EX GRATIA payment by the Management.

(2.) THIS Award was passed on 18th June, 1977. On 13th october, 1977 the appellant sent a letter to the first respondent along with a cheque in his favour for Rs. 10, 538. 91 being the amount awarded by the Labour court plus bonus for 1970 and 1971. To this letter, the first respondent sent a reply on 24th October, 1977 in the following terms : "the averments in your letter are incorrect. Under protest and without prejudice to my right to file a writ I have accepted your cheque for Rs. 10, 538. 91. The acceptance of the cheque will not in any way affect my right to claim benefits for an order of reinstatement with back wages and continuity of services. I am taking all required steps to file a writ to get appropriate reliefs. " * I am entitled to gratuity and your cheque is not in full settlement of this claim. The acceptance of the cheque is not full and final settlement. Still you are liable to pay gratituty. My service is not four years. In any event, I reserve right to take appropriate action for all my reliefs in due course of time. You please note that there is no full and final settlement. You are also informed that I am accepting the cheque under protest and without prejudice to my rights. Kindly acknowledge receipt of this letter.

(3.) THE next decision relied upon by learned counsel for the appellant is that reported in Krishna Reddy and Co. v. Thimmiah (1983) I. MLJ. 467. That case also related to the specific performance of a contract. THE principle of estoppel had to be considered with reference to the acceptance of the refund of the advance money paid by the purchaser under the contract. THEre, the vendor's counsel wrote to the counsel for the purchaser that his client did not propose to keep the contract for sale alive and that he could not execute any agreement or sale. Along with that letter, he returned a sum of rs. 13, 000/- paid as advance of sale consideration. This amount was received without prejudice by the purchaser. THE question arose before the Division bench whether the receipt of the refund of advance without prejudice would preclude the purchaser from enforcing the contract at a later stage. It was held by the division Bench that the use of the words'without prejudice'would not help the purchaser and he must be taken to have accepted the refund amount there by waiving his right to enforce the contract. THE relevant observations relied upon by learned counsel for the appellant are in paragraph 34 of that judgment and they are as follows :" * We are of the view that some principle applies to the case on hand. THE second respondent had already stated that he was not intending to execute the draft contract for sale and that the contract was no longer in existence. Assuming that Exhibit P-1 amounted to a concluded contract for sale, the first respondent has accepted the refund amount of Rs. 13, 000/-knowing full well that the second respondent has cancelled the contract. In the context, therefore, the mere conditional acceptance by the use of the words "without prejudice" to his rights under the contract for sale cannot, in any manner, derogate from the fact that he had acquiesced in the breach of the contract committed by the second respondent. As was observed in Deod marcraft v. Meux (1825-I Cer. and P. 347), what was of importance was what the first respondent did and not what he said. THE first respondent had received the money back and the effect of it cannot be taken away by the words'without prejudice'which he said. "learned counsel laid stress upon the words underlined and argued that in this case, the mere fact that the first respondent had sent a letter on 24th October, 1977 stating that he was accepting the cheque under protest, would not take away the effect of acceptance of the amount. According to learned counsel, the conduct of the first respondent in encashing the cheque without returning the same to the management would prevent him from challenging the correctness of the award passed by the Labour Court.