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K.N. WANCHOO, J
- It seems that disputes were going on between these Hotels and their workmen for some time past
about the conditions of labour of the workmen employed therein. Matters seem to have come to a head
about the end of September 1955 and a strike of all the workmen in all the three Hotels took place on
October 5, 1955. Before this general strike in the three Hotels, there had been trouble in Imperial Hotel
only in August 1955. In that connection charge-sheets were served on 22 workmen and an enquiry was
held by the management which came to the conclusion that the workmen were guilty of misconduct and
therefore decided to dismiss them. Consequently, notices were served on October 4, 1955, upon these
workmen informing them that the management had decided to dismiss them subject to obtaining
permission under Section 33 of the Industrial Disputes Act, 1947, (hereinafter called the Act). It seems
that this action of the management of Imperial Hotel led to the general strike in all the three Hotels on
October 5, 1955. Thereupon the three managements issued notices to the workmen on October 5, 1955,
directing them to re-join their duties within three hours failing which action would be taken against them.
As the workmen did not join within this time, fresh notices were issued the same day asking them to show
cause why disciplinary action should not be taken against them. In the meantime they were informed that
they would be under suspension. On October 7, 1955, the three managements issued notices to the
workmen informing them that it had been decided to dismiss them and that they were being suspended
pending the obtaining of permission under Section 33 of the Act.
. – These are three appeals by special leave from three decisions of the Labour
Appellate Tribunal of India. We shall dispose of them by one judgment, as they raise common points. The
three appellants are the managements of (1) Imperial Hotel, New Delhi, (2) Maiden’s Hotel, Delhi, and
(3) Swiss Hotel, Delhi, the respondents being their respective workmen represented by the Hotel
Workers’ Union, Katra Shahanshahi, Chandni Chowk, Delhi. - As the disputes between the Hotels and their workmen were already under consideration of
Government, an order of reference was made on October 12, 1955, relating to Imperial Hotel. In this
reference a large number of matters were referred to adjudication including the case of 22 workman
whom the management of the Hotel had decided to dismiss on October 4, 1955. This reference with
respect to Imperial Hotel, however, did not refer to the workmen whom the management had decided to
dismiss on October 7, 1955. Further enquiries seem to have been made by the management in this
connection and eventually it was decided to confirm the action taken on October 7 with respect to
nineteen workmen. These nineteen workmen had in the meantime applied under Section 33-A of the Act
on the ground that they had been suspended without pay for an indefinite period and had thus been
punished in breach of Section 33. Thus the dispute so far as Imperial Hotel is concerned was with respect
to 44 workmen in all, 25 of whom were included in the reference of October 12, 1955, and the remaining
19 had filed an application under Section 33-A of the Act. It does not appear, however, that Imperial
Hotel made any application under Section 33 of the Act for permission to dismiss these 19 workmen,
though an application under that section was made on October 22, 1955, with respect to 22 workmen
whose dismissal was decided upon on October 4, 1955. - So far as Maiden’s Hotel is concerned, the case relates to 26 workmen whose dismissal was finally
considered by the management to be necessary on further enquiry after October 7, 1955. An order of
reference was made in the case of this Hotel on November 23, 1955, in which the case of 26 workmen
was referred to the Tribunal along with other matters. Later, however, 12 of these workmen were reemployed on December 10, 1955, and the real dispute therefore so far as this Hotel is concerned related to
14 workmen. - In the case of Swiss Hotel also there were further enquiries after the notices of October 7. In the
meantime, an application was made under Section 33-A of the Act by the Union to the conciliation
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officer. Eventually, it appears that on November 10, 1955, reference was made with respect to 14
workmen to the Tribunal for adjudication. - We now come to the proceedings before the Industrial Tribunal. In all three cases, applications
were filed on behalf of the workmen for interim relief, the date of the application being October 22 in
case of Imperial Hotel and November 26 in case of Maiden’s Hotel and Swiss Hotel. Replies to these
applications were filed by the managements on December 5, 1955. On the same day, the Industrial
Tribunal passed an order granting interim relief. In the case of Imperial Hotel, it ordered that 43, out of 44
workmen, who had applied for interim relief should be paid their wages plus a sum of Rs 25 per month
per head in lieu of food till final decision in the matter of the dismissal of these workmen. In the case of
Maiden’s Hotel, the management was prepared to take back 12 workmen and they were ordered to report
for duty on or before December 10, 1955. It was also ordered that these 12 workmen till they were reemployed and the “remaining” 13 workmen till the decision of their case would be paid by way of interim
relief their wages from October 1, 1955, plus Rs 25 per month per head in lieu of food. No order was
passed with respect to the 26th workman, namely, Chiranjilal sweeper. In the case of Swiss Hotel, the
management was prepared to take back six of the workmen and they were ordered to report for duty on or
before December 10, 1955. In other respects, the order was in the same terms as in the case of Maiden’s
Hotel. - Then followed three appeals by the three Hotels against the three orders granting interim relief.
These appeals were dismissed by the Labour Appellate Tribunal on May 28, 1956. Thereupon the three
Hotels applied for special leave to appeal to this Court, which was granted. They also applied for stay of
the order of the Industrial Tribunal relating to payment of wages plus Rs 25 per month per head in lieu of
food. Stay was granted by this court on June 5, 1956, on condition that the employers would pay to the
employees a sum equal to half of the amount adjudged payable by the orders dated December 5,1955, in
respect of the arrears accrued due till then and continue to pay in the same proportion in future until
determination of the dispute between the parties. It appears that after this order of June 5, 1956, even
those workmen who had not been re-employed after the order of December 5, 1955, were taken back in
service on July 15, 1956, by the three Hotels. Thus, 2 workmen in the case of Swiss Hotel, 13 workmen in
the case of Maiden’s Hotel and 43 workmen in the case of Imperial Hotel were taken back in service. - The main contentions on behalf of the Hotels are two, namely, (1) are any wages payable at all to
workmen who are suspended pending permission being sought under Section 33 of the Act for their
dismissal?, and (2) is an Industrial Tribunal competent to grant interim relief without making an interim
award which should have been published?
Re (1 - The first question therefore that falls for consideration is the extent of the power of the employer
to suspend an employee under the ordinary law of master and servant. It is now well settled that the power
to suspend, in the sense of a right to forbid a servant to work, is not an implied term in an ordinary
contract between master and servant, and that such a power can only be the creature either of a statute
) – 9. The contention of the appellants under this head is that suspension of the workmen pending
permission under Section 33 of the Act imposes an absolute bar to the payment of any wages to the
suspended workmen. On the other hand, it is contended on behalf of the respondents that suspension of
workmen involving non-payment of wages is not contemplated at all under the ordinary law of master and
servant in the absence of an express term in the contract of employment to that effect; and as in these
cases there were admittedly no standing orders providing suspension without payment of wages, it was
not open to the appellants to withhold wages as the orders of suspension made in these cases merely
amounted to this that the employers were not prepared to take work from the workmen. Even so, the right
of the workmen to receive wages remained and the employer was bound to pay the wages during the
period of so-called suspension. The Industrial Tribunal as well as the Appellate Tribunal took the view
that in the absence of an express term in the contract of employment, wages could not be withheld, even
though the employer might suspend the workman in the sense that he was not prepared to take any work
from them.
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governing the contract, or of an express term in the contract itself. Ordinarily, therefore, the absence of
such power either as an express term in the contract or in the rules framed under some statute would mean
that the master would have no power to suspend a workman and even if he does so in the sense that he
forbids the employee to work, he will have to pay wages during the so-called period of suspension.
Where, however, there is power to suspend either in the contract of employment or in the statute or the
rules framed thereunder, the suspension has the effect of temporarily suspending the relation of master
and servant with the consequence that the servant is not bound to render service and the master is not
bound to pay. These principles of the ordinary law of master and servant are well settled and have not
been disputed before us by either party. - The next question that falls for consideration is whether these principles also apply to a case
where the master has decided to dismiss a servant, but cannot do so at once as he has to obtain the
permission necessary under Section 33 of the Act and therefore suspends the workman till he gets such
permission. This brings us to the sphere of industrial law. Ordinarily, if Section 33 of the Act did not
intervene, the master would be entitled to exercise his power of dismissing the servant in accordance with
the law of master and servant and payment of wages would immediately cease as the contract would
come to an end. But Section 33 of the Act has introduced a fundamental change in the law of master and
servant so far as cases which fall within the Act are concerned. It has therefore to be seen whether
Industrial Tribunals which are dealing with the matter under the Act must follow the ordinary law of
master and servant as indicated above or can imply a term in the contract in the peculiar circumstances
supervening under Section 33 of the Act, to the effect that where the master has concluded his enquiry
and come to the decision that the servant should be dismissed and thereupon suspends him pending
permission under Section 33, he has the power to order such suspension, which would result in
temporarily suspending the relation of master and servant, so that the servant is not bound to render
service and the master is not bound to pay wages. The power of Industrial Tribunal in matters of this kind
arising out of industrial disputes was considered by the Federal Court in Western India Automobile
Association v. Industrial Tribunal, Bombay [(1949) FCR 321] and the following observations of
Mahajan, J. (as he then was) at p. 345 are apposite:
“Adjudication does not, in our opinion, mean adjudication according to the strict law of master
and servant. The award of the tribunal may contain provisions for settlement of a dispute which no
court could order if it was bound by ordinary law, but the tribunal is not fettered in any way by these
limitations. In Volume 1 of Labour Disputes and Collective Bargaining by Ludwig Teller, it is said
at p. 536 that industrial arbitration may involve the extension of an existing agreement or the making
of a new one, or in general the creation of new obligation or modification of old ones, while
commercial arbitration generally concerns itself with interpretation of existing obligations and
disputes relating to existing agreements. In our opinion, it is a true statement about the functions of an
Industrial Tribunal in labour disputes.” - This Court in Rohtas Industries Ltd. v. Brijnandan Pandey [(1956) SCR 800] also recognised
the correctness of the dictum laid down in the above Federal Court decision and observed that there was a
distinction between commercial and industrial arbitration, and after referring to the same passage in
Labour Disputes and Collective Bargaining by Ludwig Teller (Vol. 1, p. 536), proceeded to lay down as
follows at p. 810:
“A court of law proceeds on the footing that no power exists in the courts to make contracts for
people; and the parties must make their own contracts. The courts reach their limit of power when
they enforce contracts which the parties have made. An Industrial Tribunal is not so fettered and may
create new obligations or modify contracts in the interests of industrial peace, to protect legitimate
trade union activities and to prevent unfair practice or victimisation.” - It is clear therefore that Industrial Tribunals have the power to go beyond the ordinary law of
master and servant, if circumstances justify it. In these cases the decision of the Labour Appellate
Tribunal has proceeded strictly on the basis of the ordinary law of master and servant without regard to
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the fundamental change introduced in that law by the enactment of Section 33 of the Act. All the cases to
which we have been referred with respect to the ordinary law of master and servant had no occasion to
consider the impact of Section 33 of the Act on that law as to the power of the master to suspend. We
have, therefore, to see whether it would be reasonable for an Industrial Tribunal where it is dealing with a
case to which Section 33 of the Act applies, to imply a term in the contract giving power to the master to
suspend a servant when the master has come to the conclusion after necessary enquiry that the servant has
committed misconduct and ought to be dismissed, but cannot do so because of Section 33. It is urged on
behalf of the respondents that there is nothing in the language of Section 33 to warrant the conclusion that
when an employer has to apply under it for permission, he can suspend the workmen concerned. This
argument, however, begs the question because if there were any such provision in Section 33, it would be
an express provision in the statute authorising such suspension and no further question of an implied term
would arise. What we have to see is whether in the absence of an express provision to that effect in
Section 33, it will be reasonable for an Industrial Tribunal in these extraordinary circumstances arising
out of the effect of Section 33 to imply a term in the contract giving power to the employer to suspend the
contract of employment, thus relieving himself of the obligation to pay wages and relieving the servant of
the corresponding obligation to render service. We are of opinion that in the peculiar circumstances which
have arisen on account of the enactment of Section 33, it is but just and fair that Industrial Tribunals
should imply such a term in the contract of employment. - This Court had occasion to consider this matter in four cases, though the point was not
specifically argued in the manner in which it has been argued before us now. But a consideration of these
cases will show that, though the point was not specifically argued, the view of this Court has consistently
been that in such cases a term should be implied giving power to the master to suspend the contract of
employment after he has come to the conclusion on a proper enquiry that the servant should be dismissed
and has to apply to the tribunal for permission under Section 33. - In Lakshmi Devi Sugar Mills Ltd. v. Pt. Ram Sarup [(1956) SCR 916], there was a provision in
the standing orders for suspension for four days without pay. In actual fact, however, the employer in that
case after having come to the conclusion that the employees should be dismissed suspended them without
pay pending permission of the tribunal and it was held that such suspension was not punishment, even
though it exceeded four days. This was the main point which was under consideration in that case; but it
was further observed that such a suspension was only an interim measure and would last till the
application for permission to punish the workman was made and the tribunal had passed orders thereon. If
the permission was accorded the workman would not be paid during the period of suspension; but if the
permission was refused, he would have to be paid for the whole period. - In Management of Ranipur Colliery v. Bhuban Singh, it was pointed out that but for this ban
the employer would have been entitled to dismiss the employee immediately after the completion of his
enquiry on coming to the conclusion that the employee was guilty of misconduct. The contract of service
would thus be brought to an end by an immediate dismissal after the conclusion of the enquiry and the
employee would not be entitled to any further wages. But Section 33 steps in and stops the employer from
dismissing the employee immediately on the conclusion of his enquiry and compels him to seek
permission of the tribunal. It was, therefore, reasonable that the employer having done all that he could do
to bring the contract of service to an end should not be expected to continue paying the employee
thereafter. It was pointed out that in such a case the employer would be justified in suspending the
employee without pay as the time taken by the tribunal to accord permission under Section 33 of the Act
was beyond the control of the employer. Lastly, it was pointed out that this would not cause any hardship
to the employee; for if the tribunal granted permission, the employee would not get anything from the
date of his suspension without pay, while if the permission was refused he would be entitled to his back
wages from such date. Lakshmi Devi Sugar Mills Ltd. was referred to and it was explained that the
principle laid down in that case would only apply where Section 33 would be applicable.
105 - It is urged on behalf of the respondents that there were at any rate some standing orders,
particularly in Lakshmi Devi Sugar Mills Ltd and Management of Ranipur Colliery, [CA 768 of 1957,
decided on April 20, 1959], giving power to suspend for some period of time and therefore further
suspension might be justified on the basis of those standing orders. In the case of Sasa Musa Sugar
Works (P) Ltd., [CAs 746 & 747 of 1957, decided on April 29, 1959], however, there were no standing
orders till then in force. The ratio of the decision in these cases was, however, not based on the presence
or absence of the standing orders; for there is very little difference in principle between the cases where
standing orders provided a few days suspension without pay and the suspension was continued for a much
longer period and where there were no standing orders providing suspension without pay. We are of
opinion that though these cases did not expressly proceed on the basis of an implied term in the contract
of employment to suspend the employee and thus suspend the relation of master and servant temporarily,
that must be the implicit basis on which these decisions were given. But for such a term being implied, it
would not be possible at all to lay down, as was laid down in these cases, that if a proper enquiry had been
held and the employer had decided to dismiss the workman and apply for permission and in consequence
had suspended the workman, there would be no obligation on him to pay wages from the date of
suspension if permission was accorded to him under Section 33. We are, therefore, of opinion that the
ordinary law of master and servant as to suspension can be and should be held to have been modified in
view of the fundamental change introduced by Section 33 in that law and a term should be implied by
Industrial Tribunals in the contract of employment that if the master has held a proper enquiry and come
to the conclusion that the servant should be dismissed and in consequence suspends him pending the
permission required under Section 33, he has the power to order such suspension, thus suspending the
contract of employment temporarily, so that there is no obligation on him to pay wages and no obligation
on the servant to work. In dealing with this point the basic and decisive consideration introduced by
Section 33 must be borne in mind. The undisputed common law right of the master to dismiss his servant
for proper cause has been subjected by Section 33 to a ban; and that in fairness must mean that, pending
the removal of the said statutory ban, the master can after holding a proper enquiry temporarily terminate
the relationship of master and servant by suspending his employee pending proceedings under Section 33.
It follows therefore that if the tribunal grants permission, the suspended contract would come to an end
and there will be no further obligation to pay any wages after the date of suspension. If, on the other hand,
the permission is refused, the suspension would be wrong and the workman would be entitled to all his
wages from the date of suspension - This, however, does not conclude the matter so far as the grant of interim relief in these cases is
concerned. Even though there may be an implied term giving power to the employer to suspend a
workman in the circumstances mentioned above, it would not affect the power of the tribunal to grant
interim relief, for such a power of suspension in the employer would not, on the principles already
referred to above, take away the power of the tribunal to grant interim relief if such power exists under the
Act. The existence of such an implied term cannot bar the tribunal from granting interim relief if it has the
power to do so under the Act. This brings us to the second point, which has been canvassed in these
appeals.
Re (2:) 21. After a dispute is referred to the tribunal under Section 10 of the Act, it is enjoined on it by
Section 15 to hold its proceeding expeditiously and on the conclusion thereof submit its award to the
appropriate Government. An “award” is defined in Section 2(b) of the Act as meaning “an interim or final
determination by an Industrial Tribunal of any industrial dispute or of any question relating thereto”.
Where an order referring an industrial dispute has been made specifying the points of dispute for
adjudication, the tribunal has to confine its adjudication to those points and matters incidental thereto;
[Section 10(4)]. It is urged on behalf of the appellants that the Tribunal in these cases had to confine itself
to adjudicating on the points referred and that as the question of interim relief was not referred to it, it
could not adjudicate upon that. We are of opinion that there is no force in this argument, in view of the
words “incidental thereto” appearing in Section 10(4). There can be no doubt that if, for example,
question of reinstatement and/or compensation is referred to a tribunal for adjudication, the question of
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granting interim relief till the decision of the tribunal with respect to the same matter would be a matter
incidental thereto under Section 10(4) and need not be specifically referred in terms to the tribunal. Thus
interim relief where it is admissible can be granted as a matter incidental to the main question referred to
the tribunal without being itself referred in express terms. - The next question is as to how the tribunal should proceed in the matter if it decides to grant
interim relief. The definition of the word “award” shows that it can be either an interim or final
determination either of the whole of the dispute referred to the tribunal or of any question relating thereto.
Thus it is open to the tribunal to give an award about the entire dispute at the end of all proceedings. This
will be final determination of the industrial dispute referred to it. It is also open to this tribunal to make an
award about some of the matters referred to it whilst some others still remain to be decided. This will be
an interim determination of any question relating thereto. In either case it will have to be published as
required by Section 17. Such awards are however not in the nature of interim relief for they decide the
industrial dispute or some question relating thereto. Interim relief, on the other hand, is granted under the
power conferred on the tribunal under Section 10(4) with respect to matters incidental to the points of
dispute for adjudication. - It is, however, urged on behalf of the appellants that even if the Tribunal has power under Section
10(4) of the Act to grant interim relief of the nature granted in these cases it can only do so by submitting
an award under Section 15 to the appropriate Government. Reference in this connection is made to
Sections 15, 17 and 17-A of the Act. It is submitted that as soon as the tribunal makes a determination
whether interim or final, it must submit that determination to government which has to publish it as an
award under Section 17 and thereafter the provisions of Section 17-A will apply. In reply the respondents
rely on a decision of the Labour Appellate Tribunal in Allen Berry and Co Ltd. v. Workmen [(1951) 1
LLJ 228], where it was held that an interim award had not to be sent like a final award to the Government
for publication and that it would take effect from the date of the order. We do not think it necessary to
decide for present purposes whether an order granting interim relief of this kind is an award within the
meaning of Section 2(b) and must therefore be published under Section 17. We shall assume that the
interim order passed by the Tribunal on December 5, 1955, could not be enforced as it was in the nature
of an award and should have been submitted to the Government and published under Section 17 to
become enforceable under Section 17-A. It is however, still open to us to consider whether we should
pass an order giving interim relief in view of this alleged technical defect in the order of the Industrial
Tribunal. We have the power to grant interim relief in the same manner as the Industrial Tribunal could
do and our order need not be sent to government for publication, for Sections 15, 17 and 17-A do not
apply to the order of this Court just as they did not apply to the decision of the Appellate Tribunal which
was governed by the Industrial Disputes (Appellate Tribunal) Act, 1950, (48 of 1950), (since repealed).
We have already mentioned that this court passed an order on June 5, 1956, laying down conditions on
which it stayed the operation of the order of December 5, 1955, made by the Industrial Tribunal. We are
of opinion that that order is the right order to pass in the matter of granting interim relief to the workmen
in these cases. Ordinarily, interim relief should not be the whole relief that the workmen would get if they
succeeded finally. In fairness to the Industrial Tribunal and the Appellate Tribunal we must say that they
granted the entire wages plus Rs 25 per mensem per head in lieu of food on the view that no suspension
was possible at all in those cases and therefore the contract of service continued and full wages must be
paid. Their orders might have been different if they had held otherwise. It seems to us just and fair in the
circumstances therefore to order that the appellants shall pay to their respective workmen concerned half
the amount adjudged payable by the order dated December 5, 1955, with respect to the entire period, as
the case may be, from October 1, 1955 to December 10, 1955 or July 15, 1956, by which date, as we have
already pointed out, practically all the workmen were taken back in service. We, therefore, order
accordingly. - Lastly, it is urged on behalf of the respondents that as all the workmen concerned were taken back
in service they should be paid full wages for the interim period as their re-employment means that the
decision to dismiss them and the consequent order of suspension were waived. This is a matter on which
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we do not propose to express any opinion. The proceedings are so far at the initial stage and the effect of
re-employment, in the absence of full facts, on the question of waiver cannot be determined at this stage.
It is enough to point out that the order we have passed above is an interim relief and it will be liable to be
modified one way or the other, when the Industrial Tribunal proceeds to make the final determination of
the questions referred to it in the light of the observations we have made on the matter of suspension. The
appeals are partly allowed and the order dated December 5, 1955, granting interim relief is modified in
the manner indicated above. In the circumstances, we order the parties to bear their own costs of this
Court. As more than three years have gone by in these preliminaries since the references were made, we
trust that the Industrial Tribunal will now dispose of the matter as expeditiously as possible.
