DAL CHAND Vs. JUDGE LABOUR COURT

JUDGEMENT

(1.) In this group of special appeals the controversy which is often raised is where termination of service is found to be invalid, reinstatement as a matter of course should be awarded or compensation would be an adequate relief. The question is neither new nor raised for the first time. It crops up every time when the order of termination or dismissal of the workman is held to be illegal on account of victimization or on certain technical grounds. It is of course true that ordinarily relief against illegal termination of service is reinstatement but there are exceptions to the general rule, where a Labour Court in exercise of its discretion can award compensation in lieu of reinstatement. No hard and fast rule can be laid down as an exception to general rule of reinstatement. There are catena of decisions of Apex Court and this Court which provide enough guidelines in such matters. It is vehemently argued by Mr. R.S. Saluja learned counsel for the appellant that the learned Judge presiding over the particular Labour Court while exercising its discretion as a practice has been refusing the reinstatement and awarding the compensation in lieu thereof as a practice by providing stereo type reasons. Mr. C. S. Kotwani learned counsel appearing for the respondents has taken a serious objection to the contention. Be that as it may, both the learned counsel in all fairness have placed before us the various decisions of the Apex Court dealing with the controversy. Before proceeding to deal with the case referred to, it would be appropriate to get acquainted with Section 11-A of the Industrial Disputes Act .which empowers the Industrial Tribunal or Labour Court to award any other relief such as compensation instead of reinstatement.

(2.) In Indian Iron & Steel Company Ltd. & Anr. v. Their Workmen reported in AIR 1958 SC 130 : 1958-I-LLJ-260, the Supreme Court while considering the power to interfere with the management's decision to dismiss, discharge or terminate the services of a workman, observed that in cases of dismissal on misconduct, the Tribunal does not, however, act as a Court of appeal and substitute its own judgment for that of the management and the Tribunal will interfere only when there is a want of good faith, victimization, unfair labour practice etc. on the part of management. This led to insertion of Section 11-A in the Industrial Disputes Act, 1947. It is relevant to mention that the International Labour Organization, in its recommendation concerning " Termination of employment at the initiative of the employer" adopted in June 1963, recommended that a worker aggrieved by the termination of his employment should be entitled to appeal against the termination, among others, to a neutral body such as arbitrator, a Court, an arbitration committee or a similar body and that the neutral body concerned should be empowered to examine the reasons given in the termination of employment and the other circumstance relating to the case and to render a decision on the justification of the termination. The International Labour Organization further recommended that a neutral body should be empowered (if it finds that the termination of employment was unjustified) to order that the worker concerned, unless reinstated with unpaid wages should be paid adequate compensation or afforded some other relief. In accordance with these recommendations it was considered that the Tribunal's power in an adjudication proceeding relating to discharge or dismissal of a workman should not be limited and that the Tribunal should have the power, in cases wherever necessary to set aside the order of discharge or dismissal and direct reinstatement of the workman on such terms and conditions, if any as it thinks fit or give such other relief to the workman including the award of compensation or any lesser punishment in lieu of discharge or dismissal as the circumstances of the case may require. Thus, Section 11-A was introduced by way of amendment in the Industrial Disputes Act which reads as follows:

(3.) The first case referred to by the learned counsel is Hindustan Steels Ltd., Rourkela v. A. K. Roy & Ors. reported in AIR 1970 SC 1401 : 1969 (3) SCC 513 : 1970-I-LLJ-228. In the said case a workman A.K. Roy was admitted as a trade apprentice. On completion of his training he was appointed as skilled workman in the year 1958. On December 9, 1960 he was: served with an order by which his services were terminated. He was removed from the service because of the adverse police report. The order of termination was found to be illegal by the Tribunal. The said finding was confirmed by the High Court. On appeal by the Company, the special leave was granted only on the limited question as to whether the Tribunal was in the circumstances of the case justified in directing reinstatement. The Apex Court held that the discretion is vested with the Tribunal to award compensation instead of reinstatement if the circumstances of the particular case are unusual or exceptional so as to make reinstatement inexpedient or improper. The Apex Court observed as follows at p. 234 of LLJ: