Management of Chandramalai Estate v. Its WorkmenAIR 1960 SC 902

Case Summary

Full Case Details

K.C. DAS GUPTA, J. – On August 9, 1955, the Union of the workmen of the Chandramalai
Estate submitted to the Manager of the Estate a memorandum containing fifteen demands.
Though the Management agreed to fulfil some of the demands the principal demands
remained unsatisfied. On August 29, 1955, the Labour Officer, Trichur, who had in the
meantime been apprised of the position by both the management of the Estate as well as the
Labour Union advised mutual negotiations between the representatives of the management
and workers. Ultimately the matter was recommended by the Labour Officer to the
Conciliation Officer Trichur for conciliation. The Conciliation Officer’s efforts proved in
vain. The last meeting for Conciliation appears to have been held on November 30, 1955. On
the following day the Union gave a notice and the workmen went on a strike with effect from
December 9, 1955. The strike ended on January 5, 1956. Prior to this, on January 5, the
Government had referred the dispute as regards five of the demands for adjudication to the
Industrial Tribunal, Trivandrum. Thereafter by an order dated June 11, 1956, the dispute was
withdrawn from the Trivandrum Tribunal and referred to the Industrial Tribunal, Ernakulam.
By its award dated October 17, 1957, the Tribunal granted the workmen’s demands on all
these issues. The present appeal has been preferred by the management of the Chandramalai
Estate against the Tribunal’s award on three of these issues. These three issues are stated in
the reference thus:
“1. Was the price realised by the management for the rice sold to the workers
after decontrol excessive; and if so, are the workers entitled to get refund of the
excessive value so collected?

2. Are the workers entitled to get cumbly allowance with retrospective effect
   from the date it was stopped and what should be the rate of such allowance?
3. Are the workers entitled to get wages for the period of the strike?”
   (2) On the first issue the workmen’s case was that after the control on rice was lifted by
   the Travancore-Cochin Government in April 1954, the management which continued to sell
   rice to the workmen, charged at the excessive rate of 12 annas per measure for the rice
   brought in excess of a quota for 1-1/2 measure per head. This according to the workmen was
   improper and unjustified and they claimed refund of the excess which they have been made to
   pay. The management’s case was that the workmen were not bound to buy rice from the
   Estate’s management and secondly, that only the actual cost price and not any excess had
   been charged. The tribunal held on a consideration of oral and documentary evidence that the
   management had charged more than the cost price and held that they were bound to refund the
   same.
   (3) The second issue was in respect of a claim for cumbly allowance. Chandramalai Tea
   Estate is situated at a high altitude. It is not disputed that it had been customary for the
   Estates in this region to pay blanket allowance to workmen to enable them to furnish
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   themselves with blankets to meet the rigours of the weather and that it had really become a
   part of the terms and conditions of service. But in spite of it the management of this Estate
   stopped payment of the allowance from 1949 onwards and resumed payment only in 1954.
   The management’s defence was that any dispute not having been raised about this till August
   9, 1955, there was no reason for raising it at this late stage. The Tribunal rejected this
   contention and awarded cumbly allowance of Rs. 39 per workman – made up of Rs.7 per year
   for the year 1949, 1950 and 1951 and Rs. 9 per year for the years 1952 and 1953.
   (4) On the third issue while the workmen pleaded that the strike was justified the
   management contended that it was illegal and unjustified. The Tribunal held that both parties
   were to blame for the strike and ordered the management to pay workers 50 per cent of their
   total emoluments for the strike period.
   (5) On the question of excess price of rice having been collected the appellant’s
   contention before us is limited to the question of fact, whether the Tribunal was right in its
   conclusion that more than cost price was realised. The Tribunal has based its conclusion as
   regards the price realised by the management on entries made in the management’s own
   documents. As regards what such rice cost the management it held that for the months of
   April, July and August and September the price was shown by the management’s documents
   while for May and June these documents did not disclose the price. For these two months the
   Tribunal held the market price of rice as proved by the workers’ witness No. 6 to have been
   the price at which the Estate’s management procured their rice. We are unable to see
   anything that would justify us in interfering with these conclusions of facts. Indeed the
   documents on which the Tribunal has based its conclusions were not even made part of the
   Paper-Book so that even if we had wanted to consider this question ourselves it would be
   impossible for us to do so. We are satisfied that the Tribunal was right in its conclusion as
   regards the cost price of rice to the management and the price actually realised by the
   management from workmen. The management’s case that the workmen were charged only
   the cost price of rice has rightly been rejected by the Tribunal. The fact that workmen were
   not compelled to purchase rice from the management is hardly material; the management had
   opened the shop to help the workmen and if it is found that it charged excess rates, in fairness,
   the workmen must be reimbursed. The award in so far as it directed refund of the excess
   amount collected on the basis of the figures found by the Tribunal cannot therefore be
   successfully challenged.
   (6) On the question of the cumbly allowance it is important to note that the only defence
   raised was that the demand had been made too late. The admitted fact that it had been
   regularly paid year after year for many years till it was stopped in 1949 is sufficient to
   establish the workmen’s case that payment of a proper cumbly allownace had become a part
   of their conditions of service. We do not think that the mere fact that the workmen did not
   raise any dispute on the management’s refusal to implement this condition of service till
   August 9, 1955 would be a sufficient reason to refuse them such payment. The management
   had acted arbitrarily and illegally in stopping payment of these allowances from 1949 to 1954.
   They cannot now be heard to say that they should not be asked to pay it merely because the
   years have already gone by. It is reasonable to think that even though the management did not
   pay the allowance the workmen had to provide blankets for themselves at their own expense.
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   The Tribunal has acted justly in directing payment of the allowances to the workmen for the
   years 1949 to 1953. The correctness of the rates awarded by the Tribunal is not challenged
   before us. The Tribunal’s award on this issue also is therefore maintained.
   (7) This brings us to the question whether the tribunal was right in awarding 50 per cent
   of emoluments to the workmen for the strike period. It is clear that on November 30, 1955,
   the Union knew that conciliation attempts had failed. The next step would be a report by the
   Conciliation Officer, of such failure to the Government and it would have been proper and
   reasonable for the Union to address the Government at the same time and request that a
   reference should be made to the Industrial Tribunal. The Union however did not choose to
   wait and after giving notice on December 1, 1955 to the management that it had decided to
   strike from December 9, 1955, actually started the strike from that day. It has been urged on
   behalf of the appellant that there was nothing in the nature of the demands to justify such
   hasty action and in fairness the Union should have taken the normal and reasonable course
   provided by law by asking the Government to make a reference under the Industrial Disputes
   Act before it decided to strike. The main demands of the Union were about the cumbly
   allowance and the price of rice. As regards the cumbly allowance they had said nothing since
   1949 when it was first stopped till the Union raised it on August 9, 1955. The grievance for
   collection of excess price of rice was more recent but even so it was not of such urgent nature
   that the interests of labour would have suffered irreparably if the procedure prescribed by law
   for settlement of such disputes through industrial tribunals was resorted to. After all it is not
   the employer only who suffers if production is stopped by strikes. While on the one hand it
   has to be remembered that strike is a legitimate and sometimes unavoidable weapon in the
   hands of labour it is equally important to remember that indiscriminate and hasty use of this
   weapon should not be encouraged. It will not be right for labour to think that for any kind of
   demand a strike can be commenced with impunity without exhausting reasonable avenues for
   peaceful achievement of their objects. There may be cases where the demand is of such urgent
   and serious nature that it would not be reasonable to expect labour to wait till after making the
   Government to make a reference, in such cases, strike even before such a request has been
   made may well be justified. The present is not however one of such cases. In our opinion the
   workmen might well have waited for some time after conciliation efforts failed before starting
   a strike and in the meantime to have asked the Government to make the reference. They did
   not wait at all. The conciliation efforts failed on November 30, 1955, and on the very next
   day the Union made its decision on strike and sent the notice of the intended strike from 9th
   December, 1955, and on the 9th December, 1955 the workmen actually struck work. The
   Government appear to have acted quickly and referred the dispute on January 3, 1956. It was
   after this that the strike was called off. We are unable to see how the strike in such
   circumstances could be held to be justified.
   (8) The Tribunal itself appears to have been in two minds on the question. Its conclusion
   appears to be that the strike though not fully justified, was half justified and half unjustified;
   we find it difficult to appreciate this curious concept of half justification. In any case, the
   circumstances of the present case do not support the conclusion that the strike was justified at
   all. We are bound to hold in view of the circumstances mentioned above that the Tribunal
   erred in holding that the strike was at least partially justified. The error is so serious that we
   are bound in the interests of justice to set aside the decision. There is, in our view, no escape
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   from the conclusion that the strike was unjustified and so the workmen are not entitled to any
   wages for the strike period. We therefore allow the appeal in it and set aside the award in so
   far as it directed the payment of 50 per cent of the total emoluments for the strike period but
   maintain the rest of the award.