JUDGMENT
Untwalia, J.
1. The two Civil revision applications filed under Section 115 of the Code of Civil Procedure by the Calcutta Chemical Company Limited and the application under Article 227 of the Constitution (C. W. J. C. 509/67) filed by the employee, Dipak Kumar Barman, arise out of the same proceeding before the Labour Court, Patna, under Section 26 of the Bihar Shops and Establishments Act, 1953 Bihar Act 8 of 1954 (hereinafter called the Act), and hence all these three applications have been heard together and are being disposed of by this judgment. I shall deal with the preliminary objection raised on behalf of the employee as to the maintainability of the two civil revision applications as also the other points which fall for our decision in these cases after I have stated the relevant facts.
2. The Calcutta Chemical Company Limited has got its head office in Calcutta. It has got a branch office at Patna which is undisputedly registered as an establishment under Section 6 of the Act. Barman was employed as a salesman in the Patna branch of the Company. He seems to have been so employed on 28-8-1961. On 7-9-1964, Barman’s case is that he fell ill and applied for three days’ sick leave from 8-9-1964 to 10-9-1964. He had to extend his leave up to 12-9-1964 supported by a medical certificate. The Governing Director of the Company who lives in Calcutta wrote a letter dated 10-9-1964, which is Ext. 1/C in the proceeding, refusing the prayer for leave made by Barman by his letter dated 8-9-1964. Explanation was also asked for, and he was prohibited from resuming his duties till the matter was decided. Barman’s case is that he submitted his explanation on 12-9-1964, a copy of which is Ext. 1/b and prayed for resumption of his duties on the expiry of his leave. He received its reply on 16-9-1964. This letter of the Governing Director is dated 14-9-1964 and is Ext. 1/d. According to the case of the employee, his service was terminated from 8-9-1964. He was offered one month’s pay in lieu of notice and other amenities up to 30-6-1964 in case he did not contest the order contained in Ext. 1/d.
I will do better to quote here in full the contents of Ext. 1/d, a copy of which is Annexure A to the supplementary affidavit filed on behalf of the petitioner in Civil Revision 320 of 1967.
“Your letter dated 12-9-1964 justifying your conduct.
We have reasons to suspect that your sickness is malingering and that you do not want to work any more with the van driver and attendant who were reporting your laxity. Our sales are already down and the Puja market is being neglected.
We do not want to rake up all these things unless we are compelled to and want to give you a chance to work with some other concern after correcting yourself.
Kindly consider your services terminated effective from 8th September, 1964. You will be paid one month’s salary in lieu of this notice and will be entitled to receive other amenities up to 30th June, 1964. All these offers will be considered as withdrawn if there is a contest between us and we will be free to disclose all charges against you.”
3. The case of the employee further was that he had sent a letter on 26-9-64 to the management enquiring the authority and the reasons for his dismissal, but he received no reply. The Labour Court savs in its impugned order that his letter dated 26-9-64 has not been produced. He also alleges to have demanded one month’s pay from the officer in charge of the Patna branch, but payment is alleged to have been refused. He then filed a complaint under Sub-section (2) of Section 26 of the Act on 10-10-1964. On that very date, i.e., 10-10-64, the Governing Director, Mr. K. C. Das, is said to have passed an order of dismissal which is contained in the letter of that date. This letter is said to have been received by the employee later. It is Ext. G in the proceeding and a copy of it is Annexure C to the supplementary affidavit on behalf of the petitioner in Civil Revision 320 of 1967.
It will be of use to quote this letter also:
“For want of any address in your letter dated 26-9-64 we could not reply to your letter earlier which we informed you by our letter No. 4013 dated 1-10-1964 through our Patna Office. We could find one address from our office record and decided to reply to your above letter.
We wanted to give you a chance to work with some other concern after correcting yourself. As such your service was terminated by our letter No. 3309 dated 14-9-1964 wherein we offered you one month’s salary in lieu of notice and other amenities you are entitled to get up to 30th June, 1964. It was also mentioned in the letter that all these offers will be considered as withdrawn in case there is a contest between us. Now as you have refused to receive all these offers and as we presume that you want to enter into a contest with us we hereby withdraw all these amenities offered to you as mentioned in the last paragraph of your letter No. 3309 dated 14-9-1964, and you should consider yourself dismissed from service for gross misconduct effective from 8-9-1964. The matter will now rest with the court of law in case of any litigation. Regarding the heavy damage which the Company had to sustain due to your negligence and misconduct we are at a liberty to realise the amount from you.
Regarding your Provident Fund money you may apply to the Trustees, Calcutta Chemical Co. Ltd. Provident Fund, declaring that you are no ‘longer in our service and have ceased all connections with us.”
4. The employer, on receipt of the notice of the petition filed by the employee under Section 26 of the Act, in the first instance, sent a show cause by post which was received in the office of the Labour Court at Patna on 29-10-64. It is not necessary to refer to any statement in this show cause. The employer filed a petition on 8-2-65 taking a preliminary objection in regard to the jurisdiction of the Labour Court to entertain the application filed by the employee. The objections raised by the employer were repelled by the Labour Court by its order dated 13-3-1965. The Company filed Civil Revision 371 of 1965 from the said order. A rule was issued, but finally the proceeding in the Labour Court which was at one time staved in the civil revision was not stayed. It was allowed to go on. The management thereafter filed two written statements in the court below. The main written statement was filed on 10-12-65. According to its case, the work of Barman was never satisfactory. He neglected to carry out the instructions of the management while on tour by not submitting daily business reports, weekly account, arrival and departure reports and stock returns. He retained heavy cash balances. He drew daily allowances from the 10th to the 14th January, 1963 on false report, which fact he admitted in his letter dated 4-3-63 at an enquiry, a copy of which is Ext. A in the proceeding. Reports of misappropriation were received against Barman in July, 1964 by Mr. Ashit Roy Chowdhury (D. W. 3). It was found that Barman had taken some stock to his home which was declared to be damaged but was not returned. After the enquiry Barman returned those articles and they were entered in the Stock Register. These facts were admitted by Barman in a statement signed by him (Ext. A/1 dated 13-8-64).
Barman left the station on or about 15-8-64 without permission and applied for leave for 17-8-64 and 18-8-64 from Dalsingsarai a place in the district of Darbhanga. Barman was to go on tour on 8-9-64, but he absented himself and was found absent from his house. He sent his application for leave on the ground of illness which was reported to be a pretending illness, as he was found moving in the town. Barman’s further acts of misconduct in misappropriating the goods returned by Shyam Sundar Store of Pehri on Sone and Ayub & Sons of Gaya also came to light between the dates 14-9-64 and 10-10-64, and so also he was dismissed. Barman never demanded one month’s pay and that his letters dated 29-9-64 and 30-9-64 had been replied. The management, therefore, was justified in both its orders in terminating the service of Barman.
5. Barman filed a long rejoinder to the written statements filed by the Company. He denied all the charges levelled against him. He pleaded that if he was really guilty of allegedly gross misconduct, he must have been charge-sheeted. On the contrary, he was given several special increments for his good service. He submitted that the last paragraph of his statement before Mr. P. N. Chatterjee (D. W. 1) was written by him under coercion and intimidation and at his dictation. He alleged that some times some articles were left in the van due to short delivery and those used to be returned to the purchaser in the next trip. Mr. Ashit Roy Chowdhury is alleged to have been satisfied by the explanation given by him, and the matter ended. According to Barman, no permission for leaving station on holidays was necessary. His further plea was that the management was not entitled to dismiss him when the matter of discharge was sub judice in the labour Court.
6. When the matter of adducing evidence before the Labour Court came, Barman raised an objection before it that the Company must adduce evidence only on the points of allegations made in the letter of dismissal or discharge elated 14-9-64 and it should not be allowed to adduce evidence in support of its case as made out in its written statements. The Labour Court overruled this objection of the employee by its order dated 8-6-66. Barman filed Civil Revision 1052 of 1966 which was finally heard and dismissed by the sitting singly, on 6-2-67. The parties
thereafter adduced their evidence, on a consideration of which the Labour Court has held that the Governing Director had no reasonable cause for terminating the service of or dismissing Barman from 8-9-64. Hence, the Court has directed his reinstatement from 8-9-64 with all the benefits under the terms and conditions of his service, excepting his salary and any special emolument. The Court has also awarded him compensation in the shape of his six months pay at the undisputed rate of Rs. 189 per month which he was drawing on 8-9-64. The compensation in the shape of six months’ pay only has been granted by saying in the order dated 28-2-67 that the Court did not find it just and proper to grant him his entire wages for the idle period as compensation and also because in its opinion it was not empowered to grant him his entire back wages as compensation, under Section 26 (5) (b) of the Act.
The Company feeling aggrieved by the order of the Labour Court has preferred Civil Revision 320 of 1967 and the employee filed Civil Revision 341 of 1967 from the same order. The application by the employee which was registered as Civil Revision 341 of 1967 was also labelled as an application under Article 227 of the Constitution, besides being one under Section 115 of the Code. Rule was issued in Civil Revision 341 of 1967 as such, but when all the Civil revisions came up for hearing before me on 31-7-67, Mr. B. G. Ghose appearing for the petitioner in Civil Revision 341 of 1967 stated that since the application had also been labelled as one under Article 227, the case should go before a Division Bench for hearing. I asked him to elect as to whether the application should be treated as one under Section 115 of the Code or under Article 227 of the Constitution. He elected that the application should be treated as one under Article 227. I directed the application to be converted into and registered as civil writ jurisdiction case and further directed all the cases to be placed before a Division Bench for hearing. Thus, the two civil revisions and Civil Revision 341 of 1967 on being converted into and registered as C, W. J. C. 509 of 1967 have eventually come before us for hearing and disposal.
7. Mr. B. C. Ghosh appearing for the employee opposite party in the two civil revision applications filed by the employer took a preliminary objection that the Labour Court is not a Court subordinate to the High Court within the meaning of Section 115 of the Code. Hence, the applications in revision filed by the employer are not maintainable. The employee himself had challenged as stated above, the order dated 8-6-66 of the Labour Court in this proceeding by filing Civil Revision 1052 of 1S66. The application was entertained and disposed of as such. Even that apart, there is no doubt, and this position could not be disputed that the Labour Court, the prescribed authority under the Act, is a Court, in view of the Full Bench decision of this Court in Arjun Rautara V. Krishna Chandra, AIR 1942 Pat 1 (FB). Mr. Ghose, however, submitted that it is not a Court subordinate to the High Court, within the meaning of Section 115 of the Code. In the first instance, in view of the decisions of this court in Abdul Razak v. Kuldip Narain, AIR 1944 Pat 147 and A. Hasan v. Md. Shamsuddin, AIR 1951 Pat 140, I am inclined to take the view that the Labour Court is a Court subordinate to the High Court. Even assuming it to be not so, since all the cases were placed before and have been heard by a Division Bench, it makes no difference whether the applications are under Section 115 of the Code or under Article 227 of the Constitution. To all intents and purposes, the scope of the applications under Section 115 of the Code or Article 227 of the Constitution is not very different. The same view was expressed in another Bench decision of this Court in Imperial Tobacco Co. v. Asst. Labour Commr., Patna, AIR 1967 Pat 153. I, therefore, overrule the preliminary objection raised on behalf of the employee.
8. Mr. K. D. Chatterji appearing for the Company submitted that the Labour Court has assumed jurisdiction in this case by wrongly deciding the two points of objection raised before it by the employer. His submission was that the party to the proceeding was the Calcutta Chemical Company Limited which has got its head office or registered office in Calcutta beyond the jurisdiction of the Labour Court, Patna. The Patna branch office or the officer in charge of that office was not made a party to the proceeding. In that view of the matter, the case as instituted by the employee was not entertain-able by the Labour Court, Patna. I do not find any substance in this point. Learned counsel drew our attention to the definition of the word “employer” in Sub-section (5) of Section 2:
“Employer means a person who owns or exercises ultimate control over the affairs of an establishment and includes a manager, agent or any other person in the immediate charge of the general management or control of such establishment.”
It is true that the Manager of the Patna branch can also be called an employer within the meaning engrafted in Section 2(5) of the Act. But it is not necessary to file the petition of complaint under Section 26 of the Act against the Manager of a particular branch. The Calcutta Chemical Company Limited is a person who owns or exercises ultimate control over the affairs of an establishment, viz., the Patna establishment, which comes within the meaning as defined in Section 2(5), and, as stated above, is a registered establishment under Section 6 of the Act. There is nothing in the Act to indicate that the Labour Court, Patna, while entertaining an application by an employee of the Patna branch of the Company cannot cause a notice to be served on the employer, viz., the Company, under Section 26(5)(a) of the Act. Learned counsel for the Company could not go to the extent of suggesting that merely because the Company has its head office in Calcutta, the Labour Court cannot cause the notice to be served upon it.
I may draw an analogy from the numerous decided cases under Section 20 of the Code of Civil Procedure, wherein it has been held that a corporate body will be deemed to be carrying on a business at a particular place, where it has got its branch office. That being so, the employee of the Patna branch of the Calcutta Chemical Company Limited undoubtedly will have a right to lodge a petition of complaint against the Company itself to claim such relief as he may be entitled to do. If the view canvassed on behalf of the Company is accepted, it will lead to anomalous results. The employee cannot be held to be without remedy. If he initiates proceeding only against the Branch Manager treating him as his employer within the meaning of Section 2(5) of the Act, then no order for payment of money compensation can be passed against the Company. It can be passed only against the Manager who obviously cannot be personally liable for payment of the compensation for the allegedly wrongful dismissal or discharge of the employee concerned.
9. The second submission on behalf of the Company in regard to the point of jurisdiction was that the order dated 14-9-1964 was not an order of dismissal or discharge of the employee, which order was passed only on 10-10-64, but the order dated 14-9-64 was either an offer to bring about the termination of a contract of employment between the employer and the employee or it was a case of pure and simple termination of service under the express or implied term of the contract and hence outside the purview of Section 26 of the Act, as held by a Bench of this Court in Jagdish Vastralaya v. State of Bihar, AIR 1964 Pat 180, to which decision I was a party. I am unable to accept even this argument on the point of jurisdiction. Reading the letter (Ext. 1/d) by itself, it is clear that due to certain reasons mentioned in it, the services of the employee were terminated with effect from 8-9-1964, which is the date from which he had absented himself from the duty on ground of illness, as is his case, or on the ground of pretended illness, as is the case of the employer. The other part of the letter is confined to the payment of one month’s salary in lieu of the notice and to the other amenities up to 30-6-64. The termination of service was not dependent upon its acceptance by the employee. This is further clear from the letter dated 10-10-64 (Ext. G). Both of which letters I have quoted in extenso previously. In the second letter, it was again made clear that the service was terminated by the letter dated 14-9-64, wherein the offer was confined to one month’s salary in lieu of notice and other amenities. I therefore, hold that the employer put an end to the service of the employee by its letter dated 14-9-64.
10. In my opinion, the letter dated 14-9-64 is not such as can be interpreted to be a termination of service simpliciter in exercise of the express or implied terms of the contract of service. Under Section 26 of the Act a ban has been imposed on the employer not to dismiss or discharge from his employment any employee who has been in such employment continuously for a period of not less than six months. The employer, however, can do it for a reasonable cause and by giving such employee at least one month’s notice or one month’s wages in lieu of such notice. The giving of one month’s notice or one month’s wages in lieu of such notice can be dispensed with, if the case comes under the proviso to Sub-section (1) of Section 26 of the Act, that is to say, if the services of an employee are dispensed with on a charge of such misconduct as may be prescribed by the State Government, of which misconduct the employee has been held to be guilty by the employer at an enquiry on satisfactory evidence recorded at such enquiry.
In the case of Jagdish Vastralaya, AIR 1964 Pat 180, it was held:
“I consider that the provision of Section 26(1) of the Act applies only to a case where an employer ‘dismisses’ or ‘discharges’ an employee who has been in such employment continuously for the prescribed period. To put it in other words, Section 26(1) applies to a case where the employee is guilty of a fundamental breach of his duties under the contract of employment. In a case where the employee is guilty of misconduct, wilful disobedience or habitual neglect, it is deemed in law that there is wrongful repudiation of the contract on the part of the employee, and the employer is entitled in such a case to treat the contract as at an end and to summarily discharge or dismiss the employee. In my opinion, Section 26(1) of the statute contemplates a situation of this kind and does not apply to a case where there is termination of the contract of employment by the employer by virtue of an express or implied term in the contract itself.”
Out of the batch of cases decided by this Court along with the case of Jagdish Vastralaya, AIR 1964 Pat 180 one case went up to the Supreme Court, the decision of which is reported in AIR 1966 SC 1729 (Caltex (India) Ltd. Calcutta v. Presiding Officer, Labour Court, Patna). The point as to whether Section 26 covers a case of termination of service under the express or implied term of the contract did not fall for decision of the Supreme Court in the case of Caltex (India) Ltd. AIR 1966 SC 1729. But when the vires of the section was attacked on the ground; of excessive delegation of the legislative authority, it was repelled by the Supreme Court by saying:
“We are of opinion that there is guidance in the words of the section itself in the matter of specifying misconduct on proof of which no notice would be necessary. It is well known that in industrial law there are two kinds of misconduct, namely, (i) major misconducts which justify punishment of dismissal/discharge, and (ii) minor misconducts which do not justify punishment of dismissal/discharge but may call for lesser punishments. Therefore, when the legislature indicated that the State Government will prescribe the kinds of misconduct on proof of which no notice will be required and services of an employee can be dispensed with it was clearly indicating to the State Government to include in its list of misconducts such of them as are generally understood as major misconducts which justify the dismissal/discharge of an employee. This in our opinion is sufficient guidance to the State Government to specify in the rule it was expected to make such misconduct as is generally understood in industrial law to call for the punishment of discharge/dismissal.”
11. The word ‘dismissal’ in relation to service and the expression ‘”termination of the contract of employment” have got clear and definite concept. The word ‘discharge’, however, is found used sometimes in the statute and sometimes in the decisions of the Court in different colour and context. Sometimes it is used in the sense of dismissal; sometimes it is used in the sense of discharge from service, which is dismissal from service but entitling the discharged employee to some amenities or benefits arising out of the service; and sometimes it is also used in the sense of pure termination of contract of employment. In Section 26 of the Act, the expression used is that no employer shall dismiss or discharge from his employment any employee, meaning thereby dismiss or discharge from service by way of punishment, as clearly spoken of in the passage which I have extracted from the judgment of the Supreme Court in the case of Caltex (India) Ltd. AIR 1966 SC 1729.
On the authority of an unreported decision of the Supreme Court given on 3-9-1968 in Civil Appeal 630 of 1966 (The Chairman, Brooke Bond India (P) Ltd. v. Chandra Nath Choudhary), a copy of which judgment was produced before us by Mr. Ghose, it was contended by him that the authority of this Court in Jagdish Vastralaya’s case, AIR 1964 Pat 180, taking the view that in a pure case of termination of contract of employment, the provisions of Section 26 are not attracted has not been accepted as correct by the Supreme Court. In my opinion, it is not so. The argument before the Supreme Court on behalf of the employer appellant was that if in a domestic enquiry held by the employer the employee had been found guilty of misconduct, under Section 26 of the Act, it was not open to the Labour Court to arrive at its own conclusion on the question of misconduct on the evidence adduced before it, but the scope of the proceeding before the Labour Court must be confined, as in the case of a proceeding before the Industrial Tribunal under Sections 33 and 33A of the Industrial Disputes Act, to see as to whether the domestic enquiry suffered from an infirmity of the kind, such as victimisation of the employee, unfair labour practice, violation of the principles of natural justice, or the like in order to justify the interference with the order of dismissal by the Labour Court. This argument was repelled by the Supreme Court on reading the special provisions of law contained in the various Sub-sections of Section 26 of the Act. In that connection, when Jagdish Vastralaya’s case, AIR 1964 Pat 180 was cited before the Supreme Court, it was brushed aside on the ground that the decision “contains hardly any reasoning”. On reading the judgment of the Supreme Court, it seems to me that learned counsel for the employer appellant before that Court endeavoured to cite the Bench decision of this Court in Jagdish Vastralaya’s case, AIR 1964 Pat 180 as if it had laid down that for all purposes “the power conferred upon the prescribed authority under Section 26 of the Bihar Shops and Establishments Act is more restricted than the power of the Industrial Tribunal under the Industrial Disputes Act”. Nothing of the kind was laid down by this Court. This observation was made for the purpose of holding, on interpreting the terms of Section 26 of the Act, that the principles laid down in a number of cases by the Supreme Court arising out of the Industrial Disputes Act, that the Industrial Tribunal could go into the question of termination of service under the terms and conditions of the service to see as to whether it was a colourable or bona fide exercise of power under the contract, could not be applied to a case of termination of service by an employer of the employee under the express or implied term of the con-tract under the Shops and Establishments Act.
Even in Civil Revn. No. 1052 of 1966 (Pat) which I had decided earlier to the decision of the Supreme Court in the case of Brooke Bond India Ltd. Civil Appeal No. 630 of 1966 D/- 3-9-1968 (SC), I had said that there are three ways by which the services of an employee can be dispensed with by an employer. One may be termination of the contract of employment by the employer by virtue of an express or implied term of contract of service. In such a case, whatever may be the reason for termination, the case is outside the scope of Section 26 of the Act. The second way of dispensing with the services of the employee is to dismiss or discharge him on the existence of a reasonable cause which may be a minor misconduct, as understood in the Industrial Disputes Act or may be a major misconduct, as prescribed by the State Government in Rule 20 of the Bihar Shops and Establishments Rules, 1955. If the employer chooses to dismiss or discharge an employee on giving one month’s notice or one month’s wages in lieu of such notice, it matters little whether the services are dispensed with for a minor misconduct or a major misconduct. If, however, the employer does not give one month’s notice or one month’s wages in lieu thereof, it is incumbent upon him to hold an enquiry and then to find the employee guilty of any of the acts of misconduct, as has been prescribed by the State Government under Rule 20. And then 1 had said– “The domestic enquiry may be fair or impartial. Even so, unlike the law laid down in the cases under the Industrial Disputes Act, it is open to the Labour Court to hold, on the evidence adduced by the parties before it, that the employee had not been guilty of any misconduct as held by the employer”. In this respect, the law laid down with reference to the cases of industrial disputes, whether arising out of a proceeding under Sections 33 and 33A of the Industrial Disputes Act or on reference of an industrial dispute under Section 10 of the Act is well settled by now that the finding recorded at the domestic enquiry cannot be interfered with, until the domestic enquiry is held to be unfair, partial or suffering from infirmities of the kind enumerated in several decisions. Here, the law engrafted in Section 26 of the Act is quite different in this regard, and that is the reason, if I may say so with respect, which led to the Supreme Court to hold that even in spite of the finding of misconduct recorded by the employer, the matter is writ large before the labour Court. I am happy to find that in spite of my being a party to the decision in the case of Jagdish Vastralaya, AIR 1964 Pat 180, I had taken an identical view in Civil Revn. 1052 of 1966 (Pat).
12. It is, however, clear from the letter dated 14-9-64 of the Governing Director that it was not a case of pure and simple termination of the contract of employment. The services of the employee have been dispensed with, although in term calling it terminated but in effect it was dismissal or discharge of the employee from employment. It is clear from the earlier portion of the letter as also from the later portion that the services were dispensed with by way of punishment and not by way of terminating the contract of employment. That being so, I do not think that there is any substance in the argument put forward on behalf of the employer that the Labour Court had no jurisdiction to entertain the petition of complaint filed by the employee under Section 26 (2) of the Act. Civil Revision 371 of 1965, therefore, must fail.
13. Coming to the two other applications, one by the employer and the other by the employee, directed from the trial (sic) order of the Labour Court, it is first to be noticed that the attack on the order of the Labour Court by the employer is on the following grounds, (1) that the Labour Court has erred in holding that there was no reasonable cause for dispensing with the services of the employee, (2) that the Labour Court has also committed an error in holding that the offer of one month’s wages in lieu of notice was conditional and, therefore, did not fulfil the requirement of Section 26(1) of the Act, (3) that in any view of the matter, it was not a fit case where an order of reinstatement could and should have been made or, in any event, the Labour Court has given no reasons for ordering reinstatement of the employee, and (4) that reinstatement could not be ordered in view of the final order of dismissal made by the employer on 10-10-64, On the other hand, on behalf of the employee, the only point urged was that while ordering reinstatement, the Labour Court could not and ought not to have granted compensation for six months wages only the employee was entitled to his full salary and wages from the date of reinstatement, i.e., 8-9-1964.
14. To review briefly the findings recorded by the Labour Court, I would first refer to the allegation of misappropriation of the goods returned by Ayub & Sons and Shyam Sunder Store. As recorded in the order of the Labour Court, the first charge was not pressed, and in regard to the second charge, the Labour Court, firstly, was not satisfied on facts and, secondly took the view that while considering the legality of the order dated 14-9-64, the subsequent discovery could not be taken into account. Whether it is right or wrong in regard to the question of law, I need not decide in this case, but on the point of fact, I do not think that I can legally take a different view from the one taken by the Court below within the scope of my limited jurisdiction, either under Section 115 of the Code or under Article 227 of the Constitution. I leave this charge out of consideration.
The Labour Court was not satisfied about the charge of Barman retaining heavy cash balance habitually while on tours. I do not propose to examine this charge either in these cases. The next charge, which is discussed in paragraph 14 of the order of the Labour Court, is that as against the settled practice of obtaining previous permission of the employer who on this point, within the meaning of Section 2(5) of the Act was the Patna Branch Manager, the employee could not leave the station in holidays. The fact is not disputed, and it has been found also by the Labour Court that Barman had left the station on or about 15-8-64 without the permission of the Patna Branch Manager. He had then filed a leave application from Dalsingsargi. The Labour Court did not feel satisfied on the point of settled practice only on one joint application filed by Barman and two other employees (Ext. F) on 11-1-64 seeking permission. In this connection, the statement made by the employer in paragraphs 16 and 17 of Civil Revision 320 of 1967 is that when Shri B. B. Guha, the officer in charge of the Patna Branch, was being examined the entire file of leave applications was handed over to him by the petitioner’s counsel which contained numerous applications for permission to leave station. The petitioner’s counsel wanted to prove a large number of such applications, but the Labour Court observed that under the Act and the rules framed thereunder the Court was not bound to take down all the evidence, and it marked only Ext. F. It further observed that it was only necessary to mark an application signed by the particular employee, namely, Barman, and in those circumstances none of the other application was marked by the Court. Section 26 (5) (a) of the Act requires the Labour Court to record briefly the evidence adduced by the parties. In that situation, the statements contained in the 16th and the 17th Paragraphs of the Civil Revision seem to be true. I, however, do not feel persuaded to direct the taking of fresh evidence on that account and to hold definitely as to whether there was such practice or not. Although, therefore, I do not feel that I can upset the view of the labour Court for finding out a reasonable cause for dismissal or discharge of the employee on this account. I do, however, feel that leaving the station without the permission of the officer in charge of the Patna Branch in August. 19134, to say the least, was not justified, especially when a few months earlier in January, 1964, as is clear from Ext. F, Barman himself along with two other employees had applied for such permission. This is a factor which undoubtedly should have been and could be taken into consideration for seeing as to whether the order of reinstatement could be justifiably made in this case.
15. The charge that Barman had drawn daily allowance for 10-1-63 to 14-1-63 has been found to have been proved by the Labour Court, which says that Barman had admitted to have charged daily allowance falsely, and this surely was a misconduct on his part. But since this incident had happened a year and eight months before the impugned order dated 14-9-64, no action of dismissal or discharge could be taken on the basis of this incident. Learned counsel for the employer attacked this portion of the order of the Labour Court. I, however, do not find it possible to accept the argument, as presented, for justifying the dismissal or discharge of the employee on the ground of reasonable cause within the meaning of Section 26 (1) of the Act. In Halsbury's Laws of England, Third Edition, Volume 25, at page 488, Article 940, it has been said; "A master who, with full knowledge of a servant's misconduct, elects to continue him in his service cannot subsequently dismiss him for the offence which he has condoned." But again, I am definitely of the view that, considering the further acts of negligence, misconduct or lapse of the employee, which, in the opinion of the employer, would justify his service to be dispensed with, the previous conduct of the employee, although it might have been condoned on the previous occasion, can surely be taken into consideration for seeing as to whether the Case was a fit one where an order of reinstatement should be made. 16. Then, coming to the charge of removal of some phials of Bhringol and tins of Eenuka Talcum Powder on 11-8-64 I again find the difficulty in upsetting the order of the Labour Court in exercise of my limited power of revision or superintendence. It is unfortunate that no appeal has been, provided by the statute against the findings of fact recorded by the Labour Court under the provisions of Section 26 of the Act. Yet, the way in which the finding has been recorded by the Labour Court even in regard to this charge would clearly indicate that this was not a fit case where reinstatement of the employee could and ought to have been ordered. Some articles were left in the van, according to the findings recorded, due to misdelivery to the particular customers of the Company, and, therefore, the Labour Court says : "It cannot be said with certainty that this removal, if any, by Mr. Burman to his house was an act of dishonesty." While considering the document (Ext. A/1), the Labour Court has said : "This document at best shows that Mr, Burman had tried to conceal some facts from p. W. 3 and had thus made contradictory statement regarding existence of some goods in the van on two dates, i.e., 1/8 and 12-8-64." And finally the Court says: "The fact that no action was taken against Mr. Burman even after detection of such gross misconduct, warrant an inference that Mr. Burman had been let off because Ext. A/1 was not considered to be a strong proof of his dishonesty." Learned counsel for the employer invited us to go through the statements contained in Ext. A/1 and to hold that the findings recorded by the Labour Court are wholly erroneous and perverse. We did not feel persuaded to adopt this course within the limited scope of the cases before us. It is, however, abundantly clear from the various facts, even recorded as they are in the 16th and 17th paragraphs of the order of the Labour Court that in the month of August, 1964, an enquiry into the allegedly dishonest conduct of Barman had to be held by the management, in which enquiry he had made contradictory statements regarding the existence of some goods in the van on two days. This was about a month before the passing of impugned order dated 14-9-1964. Keeping in view the enquiry which was held in January, 1963 leading to a very definite finding against the employee of having drawn daily allowance for 10-1-1963 to 14-1-1963, the enquiry which was held in August, 1964, in connection with some articles left in the van and the act of Bar-man leaving the station on or about the 15th August, 1964, without the permission of the officer in charge of the Patna Branch, in my opinion, were sufficient, if the Labour Court, as I shall presently show, were aware of the true position of law embodied in Section 26(5)(b) of the Act, not to order reinstatement in this case. 17. Coming to the charge of neglect of duty, in the 18th paragraph of its order, the Labour Court says that the officer in charge of the Patna Branch had issued certain letters to Barman asking him to submit reports, business returns, etc., but he had been neglecting the instructions of his immediate superior.
These letters were issued in 1962, 1963 and 1964 up-to 4-9-1964. O. W. 2, however, said that there was no written duty chart for a salesman. The Labour Court concluded that Barman was not bound to carry out those instructions, as it was somewhat difficult for him to submit daily and weekly reports, as required in the above letters, while on tour. To say the least, it is a matter of conjecture in which the Labour Court has entered in this regard. Yet, I must say that the view however erroneous it may be, cannot justify me, in exercise of my revisional power or power of superintendence, to upset it and hold that there was reasonable cause for dispensing with the services of the employee. This again is a factor which ought to have been taken into consideration while ordering reinstatement of the employee.
18. Coming to the facts mentioned in the impugned letter dated 14-9-1964, Ext. 1/d, the Labour Court has found that Barman was ill and hence the termination of his services on an unfounded suspicion of malingering sickness cannot be said to be a reasonable ground. This fact ought not to have been viewed in isolation. Even according to the evidence of the doctor (A. W. 2) and the medical certificate which he had granted, Barman had an attack of tonsillitis and bronchitis. The Court says that the attack might not have been of a severe kind of 7-9-1964, when Barman had attended office and might not have been so severe on 8-9-1964 when he moved out of his residence on that date, but it was not possible for him to undertake a long and continuous tour for about three weeks in such state of health. On the findings as recorded by the Labour Court, it may be so, Does it, however, follow from this, in view of the past conduct of the employee, that the suspicion of the employer that Barman was pretending to be ill to go out on tour just on the day when he was asked to go out was an unfounded suspicion? The answer, of course, has been given in the negative by the Labour Court, and perhaps, in exercise of my limited jurisdiction, I am debarred from giving a positive answer on the question of fact. Yet, on the facts as they are mentioned or found by the Labour Court in this regard, and especially keeping in view the past conduct of the employee concerned, it was surely not a fit case for ordering reinstatement, when times-without number during the course of three years of service, there were so much tussle and causes for suspicion and actual acts of misconduct committed by the employee while he was in the employment of the employer. It was a clear case where employer would have lost complete confidence in such an employee, whether the charges could be proved in a Court of law like the criminal charges or not.
19. The other fact mentioned in the letter dated 14-9-1964 was as to his unwillingness to work any more with the van driver and the attendant who were complaining against Barman for laxity on his part. The Labour Court does not believe this case because Barman and the driver and the attendant were not pulling on well. It may be so. But, if the employer found that the sales had gone down, the puja market was being neglected and just on the day when Barman was asked to go on the van for pushing the sales at the time of the puja he reported to be ill and wanted leave on the ground of illness, there is no wonder that taking an overall picture of the type of employee Barman was, the employer thought that his sickness was malingering and in reality he was avoiding to go with the van driver and the attendant. Of course, the Governing Director, feeling afraid of raking up all those things, as sometimes it is difficult to prove them in a Court of law, wanted in his own way to terminate his services from 8-9-1964, thinking that this would be a pure and simple termination of the contract of employment, although in the eye of law it was not so, proceeded to dispense with the services of the employee. On the findings recorded by the Labour Court, I have felt myself unable to hold that there was reasonable cause for dispensing with or discharging Barman from employment.
At the same time, however, as I shall presently show, the order of reinstatement is not fit to be upheld.
20. The offer of one month’s salary in lieu of notice has been held to be conditional by the Labour Court. I should have thought that it is not so, because the offer of one month’s salary was unconditional, but at the same time it was indicated that if the offer was not accepted, it would be deemed to have been withdrawn and then the employer would be free to disclose all charges against the employee. It seems, being unmindful of the correct position of law the employer proceeded with another order dated 10-10-1964. This, however, could not be done as it was done, in view of the proviso to Sub-section (1) of Section 26 of the Act. But I need not detain myself on this question as on one ground or the other, I feel myself unable to hold that the order of dismissal or discharge contained even in the letter dated 14-9-1964 can be legally justified in face of the findings recorded by the Labour court.
21. Before I enter into the larger question of the scope of power of the Labour Court under Section 26(5) of the Act, I would dispose of one minor point and the last one raised on behalf of the employer that in view of the order of dismissal passed on 10-10-1964, reinstate-ment could not be ordered. This obviously is a point which has to be stated merely to be rejected. In the view I have taken of the order contained in the letter dated 14-9-1964, this point loses its substance. Whether the services had been dispensed with from 8-9-1964 by an order dated 14-9-1964 dispensing with the services from that date or by another order made on 10-10-1964, the date on which the petition of complaint had been filed by the employee before the Labour Court, is of no consequence and cannot detain the Court from ordering reinstate-ment, if otherwise this is a fit case for reinstatement.
22. As against the decision of this court in Civil Revn. 1052 of 1966 (Pat) taking the view that evidence is permissible to justify the order of dismissal or discharge dated 14-9-1964, not only on the grounds mentioned in that letter, but also on other grounds to justify this order, learned counsel for the employee submitted that in view of the unreported decision of the Supreme Court in the case of Brooke Bond India Ltd., Civil Appeal No. 630 of 1966 D/- 3-9-1968 (SC) referred to above, it must be held that evidence on other grounds was not justified and cannot be looked into except those which were mentioned in the letter dated 14-9-1964 (Ext. 1/d). I am unable to accept this contention. In one sense, on application of the principles of res judicata in this proceeding so far as this Court is concerned, the point is not open to be re-agitated. The case for final disposal has not come before this Bench by way of an appeal, it has come by being referred to by a learned Single Judge. In that view of the matter, the decision of this Court in Civil Revision 1052 of 1966 can operate as res judicata on the point which is sought to be re-agitated. But that apart, on re-examining the point in the light of the decision of the Supreme Court, I do not find any substance in the argument Put forward by Mr. Ghose. On interpretation of Sub-sections (1) and (2) of Section 26 of the Act, I was inclined to take the view, as I did on the previous occasion, that if the services of an employee are dispensed with by dismissal or discharge in accordance with the main part of Sub-section (1) in which case there may be a domestic enquiry or there may not be, it is immaterial in either view, the order of dismissal or discharge can be attacked on either of the two grounds mentioned in Clauses (i) and (ii) of Sub-section (2), Clause (ii), as a matter of construction, will also include the enquiry as to the giving of one month’s wages in lieu of one month’s notice. If, however, the services of the employee are dispensed with in accordance with the pro-viso to Sub-section (1) still the finding of “any misconduct”, any or more out of the numerous misconducts prescribed by the State Government by Rule 20 of the Rules, will not be conclusive as understood in cases under the Industrial Disputes Act. The Labour Court, in view of Clause (iii) of Sub-section (2) of Section 26 of the Act, will have ample jurisdiction to decide for itself as to whether the employee has been guilty of any misconduct, as held by the employer in an enquiry held for the purpose within the meaning of the proviso aforesaid. In that event, it may well be that the matter has got to be confined to the act or acts of misconduct, as found by the employer in the said enquiry, and the employer may not be permitted to travel beyond it. But that is not a question for decision in this case.
23. On behalf of Brooke Bond India Ltd., a very bold argument was advanced before the Supreme Court that Section. 26 of the Act could not apply to the facts of that case, as it gives jurisdiction to the Labour Court to entertain a complaint, thereunder only in cases of misconduct defined in the rules made under the Act. This argument was repelled on several grounds. One of the reasons given for repelling this argument was that Sub-section (2) confers a right on an employee to file a complaint before the Labour Court on any of the three grounds set out in Sub-section (2) of Section 26. “But even where an employer alleges that he had a reasonable cause for discharging or dismissing his employee the matter does not end. An employee ‘so dismissed or discharged’ has the right under Sub-section (2) to file a complaint on any one of the said three grounds, i.e., that there was in fact no reasonable cause, or that no notice was given to him or that he Was not guilty of ‘any misconduct’. The words ‘any misconduct’ show that Sub-section (2) is not confined only to misconducts set out in Rule 20.” In view of what has been said by the Supreme Court in the lines extracted above, I think, I have to put my view expressed above in a modified form that where the services of an employee have been dispensed with, not on the ground of a misconduct as prescribed by the State Government but on some other act of misconduct, the matter is open to be examined by the Labour Court on the evidence adduced before it, either under Clause (i), as I have said above, or even under Clause (iii), as has been said by the Supreme Court. In either view of the matter, I do not find any support for the argument put forward on behalf of the employee that even in a case which is not covered by the proviso to Sub-section (1) of Section 26 the enquiry must be confined to the
acts of misconduct or facts of reasonable cause, as stated in the order of dismissal or discharge. The argument is, therefore, rejected.
24. I may dispose of one short point before I go to discuss the last and the only main point in the case. The Labour Court has said in the 10th paragraph of the impugned order that the order dated 14-9-1964 is obviously bad, being retrospective in effect. Firstly, on the special facts of this case which according to the employer amounted to absence of the employee from duty without leave from 8-9-1964 followed by the order of dismissal or discharge, it is difficult to take the view that the order as it is is bad. In any view of the matter, on the authority of Hemanta Kumar v. S. N. Mukherjee, 58 Cal WN 1: (AIR 1954 Cal 340) and Damo-dhar Valley Corporation v. Provat Roy (1956) 60 Cal WN 1023, I hold that the order must be held to be effective from 14-9-1964, if not from 8-9-1964.
25. Under the law of master and servant, the employer has a right to terminate the contract of employment by giving the requisite notice of termination, if the period is fixed by an express or implied contract or by giving a reasonable notice. In case he dismisses or discharges the employee, finding him guilty of a fundamental breach of the duties under the contract of employment, not in the sense of holding him guilty in a Court of law but observing him guilty and telling him to be so he need not give him one month’s notice or one month’s wages in lieu of such notice. Except in the case of major misconduct, as prescribed by the State Government, the right of the employer has been affected to this extent by putting restriction within the meaning of Article 19 of the Constitution by making it incumbent upon him to give him one month’s notice or one month’s wages in lieu of such notice, even if the employee is dismissed or discharged for reasonable cause which may include any kind of misconduct.
It is well settled by several decisions in the Courts of England as also in India that even if a contract of employment is wrongly repudiated either by the employer or by the employee. Courts of law are unable to decree the specific performance of such contract and force either the employer to take the employee in service or force the employee to join the service. Departure, however, has been made in cases of industrial disputes. In the case of Western India Automobile Association v. Industrial Tribunal, Bombay, 1949 FCR 321: AIR 1949 FC 111, the argument that the Industrial Tribunal has no power to order reinstatement was overruled by Mahajan, J. (as he then was), by referring to the definition of the expression “industrial disputes” in the Industrial Disputes Act.
As pointed out in paragraph 35 of the judgment of the Supreme Court in Punjab National Bank Ltd. v. All India Pun-jab National Bank Employees’ Federation, AIR 1960 SC 160, since the judgment aforesaid of the Federal Court the authority of the Industrial Tribunals to direct reinstatement in appropriate cases has never been questioned. Under Section 26(5) (b) of the Act also, the power of giving relief to the employee by way of reinstatement has been conferred on the Labour Court. This again is a serious inroad in the law of master and servant, but at the same time it has to be observed that the power so conferred on the Labour Court under Section 26(5)(b) is not arbitrary or whimsical, because Clause (b) says: “In passing such order the prescribed authority shall have power to give relief to the employee by way of reinstatement or money compensation or both.” In appropriate cases, relief of reinstatement may be given, in some cases relief of money compensation only may be given and in some eases both reliefs may be awarded. If Clause (b) is to be interpreted to mean that it has been left at the sweet will or arbitrariness of the authority to give one relief or the other, it is manifest that such a provision will be hit by Article 14 of the Constitution. It must, therefore, be held that in appropriate cases, by giving sufficient reasons, the Labour Court can give one relief or the other or both. The expression “pass orders giving reasons therefor”, occurring in Clause (a) of Sub-section (5) of Section 26 of the Act, must be interpreted to mean that the Court is bound to give reasons not only for holding that the order of dismissal or discharge is not justified, but also in support of the concluding portion of the order as to why a particular relief or reliefs is or are being given to the employee concerned.
In this particular case, after having said in the last paragraph that, considering all the facts and circumstances and legal aspects of the case, the Labour Court was of the opinion that the Governing Director had no reasonable cause for terminating the services of or dismissing Barman from 8-9-1964, the Labour Court quashed the order and mechanically passed an order of reinstatement from 8-9-1964. The order of reinstatement is not to follow in all cases mechanically. Even in cases under the Industrial Disputes Act, as pointed out by the Supreme Court, they may not follow in certain cases, although in eases under that Act generally and ordinarily such an order does follow (vide AIR 1960 SC 160. Assam Oil Co. Ltd. v. Its Workmen: AIR 1960 SC 1264, and Anglo American Direct Tea Trading Co.. Ltd. v. Workmen of Nabortoli Tea Estate; (1961) 2 Lab LJ 625 (SC)). It may be pointed out in this
connection that in a large number of cases industrial disputes are raised by or on behalf of the entire body of workmen working in a particular industry, which industry by and large compared to the Shops and Establishments’ employers or employees governed by the Bihar Shops and Establishments Act is much bigger and substantial. In Shops and Establishments of the kind which are governed by the Act, the employer and the employee daily work in close contact and company. Both must work for the harmonious running of the establishment in mutual trust and confidence. It will be almost impossible for them to work if one has lost confidence of the other. The Supreme Court has in the case of Punjab National Bank, AIR 1960 SC 160 quoted with approval the principle laid down by the Full Bench of the Labour Appellate Tribunal in Buckingham & Carnatic Mills Ltd. v. Their Workmen, (1951) 2 Lab LJ 314 (LATI-Cal) (FB) in paragraph 36 of the judgment of the Supreme Court. The Full Bench has said:
“…… .in so ordering the tribunal is expected to be inspired by a sense of fair-play towards the employee on the one hand and considerations of discipline in the concern on the other. The past record of the employee, the nature of his alleged present lapse and the ground on which the order of the management is set aside are also relevant factors for consideration.”
The principle to be applied for ordering reinstatement under Section 26(5) of the Act can never be more lenient, if not stricter, than the one initiated by the Full Bench of the Labour Appellate Tribunal. Even on applying all those principles which the Labour Court in this particular case has failed to notice or apply, it would be manifest that Barman is not an employee, in whose case, for the various reasons already stated by me in my judgment above, an order of reinstatement could be or should have been made. Since the Labour Court has completely failed to direct itself in this regard, it must be held that the order giving the relief of reinstatement suffers from an infirmity of the kind which obviously can be called an error of jurisdiction warranting interference by this Court in exercise of its re visional power or power of superintendence.
26. In C. W. J. C. 509 of 1967, Mr. Ghose contended that once an order of reinstatement is made the Labour Court has no power to give by way of compensation only six months’ pay and not the entire wages for the idle period. In the view I have taken on the question of reinstatement, the point becomes academic and does not arise. I, therefore, express no opinion on it.
27. In the result, Civil Revision 371 of 1965 fails and is dismissed and Civil Revision 320 of 1967 is partly allowed. The, order of the Labour Court is modified, in that the relief of reinstatement given to the employee is set aside; it is held that his services will be deemed to have been dispensed with not from 8-9-1964 but from 14-9-1964, on and from which date, in view of the finding of the Labour Court that the services were dispensed with without reasonable cause, the employee will get by way of compensation six months’ pay at the undisputed rate of Rs. 189 per month which he was drawing at that time. The order of the Court below granting Rs. 200 by way of cost to the employee is also maintained. C. W. J. C. 509 of 1967, in view of the order of modification passed in Civil Revision 320 of 1967, fails and is dismissed. I shall make no order as to costs in any of the three applications in this Court.
Wasiuddin, J.
28. I agree.