Management of Silversands Beach Resort and Others vs Workmen, Silversands Employees Union and Another

Raju, J.—The above two writ appeals have been filed against the order of the learned single Judge dated 8-6-1993 in W.P. No. 7606 of

1984, whereunder the learned single Judge came to partly allow the writ petition filed by the workmen employed in Silversands Beach Resort,

Mamallapuram, against the common award of the Labour Court dated 6-5-1981 in I.D. Nos. 213 and 318 of 1980. Writ Appeal No. 761 of

1993 has been filed by the Management of Silversands Beach Resort and Writ Appeal No. 873 of 1993 has been filed by the Union of Workmen

of Silversands insofar as they felt respectively aggrieved against the order of learned single Judge dated 8-6-1993.

The Management of Silversands is running a Beach Resort Tourist Hotel at Mamallapuram from 1969 onwards. At the relevant point of time, it

appears, that about 60 employees were employed under different categories and in the beginning only ideal workmen were said to have been

recruited and they have been said to be doing the job in the hotel to the satisfaction of foreigners coming from U.S.S.R., Poland, U.S.A., U.K.,

France, Italy etc. According to the workmen, since the conditions of service were very poor, they started a Union and got it registered on 21-8-

1978 and the same was informed to the management. On 4-1-1979, the President of the said Union of workmen was said to have written to the

management in respect of the various grievances of the workmen and seeking for redress. This was said to have provoked the management which

made the management to devise methods to get rid of such workers responsible for the formation of the union and break the Union activities as

such. Before the Labour Court, two disputes were referred to for its adjudication, entertained as two different disputes. I.D. No. 213 of 1980

arose out of the reference made by the Government in G.O. Ms. No. 1408, Labour and Employment Department, dated 10-6-1980. It related to

the non-employment of 25 workmen by the management who fell into two categories, one consisting of 17 workmen and the other consisting of 8

workmen for consideration. I.D. No. 318 of 1980 arose out of a reference made in G.O.Ms. No. 1793, Labour and Employment Department,

dated 2-8-1980 and it concerned the non-employment of 15 workmen.

Pursuant to the activities of the Union referred to supra, it appears that the management issued a notice dated 11-5-1979 to 17 workmen stating

that the management wanted to reorganise the operation of the tourist resort on the whole to face the stiff competition and that 17 workmen who

have put in service ranging from 3 to 11 years as roomboys, waiters, clerks etc., would be given necessary leave on loss of pay to get themselves

qualified suitably either from the Institute of Catering Technology, Madras or from any other equivalent Institute assuring them of continuity of

service so as to conform to the process of re-organisation and run the sale as a star hotel. Such workmen were also said to have been informed

that if they are not willing to get qualified, they have to receive the retrenchment compensation and leave their service. The management appears to

have brought trained workmen from outside and deployed them in the places of 17 workmen. Conciliation proceedings were initiated and in the

meantime, it is stated that about 9 workers have been taken back as new entrants without compensation for past service on a letter of apology and

written undertaking that they will not join the Union and therefore, out of the category of 17 workmen, the relief remained to be considered in

respect of 8 workmen. The other group of 8 workmen noticed in the beginning belonged to the category of artisans and craftsman who also are

said to have put in similar service as electrician, plumber, painter, carpenter, watch and ward etc., and the management straightaway terminated the

service of those workmen on the ground that they wanted to get such works done thereafter on contract basis. Even among those 8 workmen, one

Arule, painter, was taken back as a new entrant. The claims in respect of these persons were also involved for consideration in the first of the I.Ds.

referred to above. So far as I.D. No. 318 of 1980 is concerned, it appears that 15 workmen involved in this reference went on sympathetic strike

from 21-6-1979 when 21 workmen concerned in I.D. No. 213 of 1980 came to be retrenched. Though after the failure of the conciliation

proceedings, the strike was also called off with effect from 10-1-1980 and the management was requested to permit the striking workmen to

resume duty, the management refused to do so and the workmen have also raised a dispute for reinstatement with back wages. Before the Labour

Court, the claimant-Workers'' Union filed claim statements and the management also filed their respective counters opposing the claim. At the time

of trial, oral and documentary evidence were placed before the Labour Court.

The Labour Court, as noticed earlier, answered the reference against the workmen holding in both the reference made before it that the non-

employment of all the workmen concerned in the two disputes entertained by the Labour Court was perfectly justified and that they are not entitled

to any relief. Regarding the workmen concerned in I.D. No. 213 of 1980 the stand taken by the management was that in order to satisfy the

criteria for classification of hotels issued by the department of tourism as a three star hotel, the management resolved to re-organise their business

activities to make it in confirmity, with the requirements of a three star hotel which needed qualified, trained, experienced, efficient and courteous

staff coming in contact with the guests with good staff should possess a good knowledge of English. As for the staff concerned with Reception and

Information counters, it had to be manned by qualified and experienced staff and it is in the said context and the reports made with reference to the

available standards, the notices came to be issued giving reasonable opportunity to the workmen to get themselves trained also and that in as much

as there was no proper response, the management was driven to the necessity of re-organisation of the operations of the tourists resort, which

according to the management has been done in a bona fide manner with a genuine an purposeful object. The Labour Court, after analysing the

evidence in respect of the category of 17 workmen in the first of the I.Ds., came to the conclusion that the action taken was really justified in the

interest of re-orientation and re-organisation of the business to keep it in tune with classification of a three star hotel and the plea of victimisation

was of no substance and merit. Consequently, the retrenchment of those workmen was considered to be bona fide and valid. As for the other

category of 8 workmen falling within the scope of the first of the I.Ds. itself relating to the artisans and craftsman, the Labour Court was convinced

of the genuineness of the reason and the justification for entrusting the maintenance of such works in the hotel on contract basis. Keeping in view

the economy and convenience of getting such jobs done on contract basis in a institution like a hotel and that the intention of the management

cannot be said to be lacking in bona fides. On that view, the retrenchment was considered to be valid.

So far as the category of workmen concerned in second of the I.Ds., who resorted to strike for not less than six months to show their sympathy

to the other workmen who are retrenched are concerned, the Labour Court was of the view that the striking workmen were shown to have been

indulging in activities detrimental to the interest of the hotel by resorting to the use of abusive language of those customers who wanted to come to

the hotel and preventing them also from having access to the hotel. Complaints from various customers from the reputed institutions were marked

in support of the same and materials made available to demonstrate the damage said to have been caused to the water tank also during the period

and the Labour Court, therefore, thought that it was no just to order to reinstatement of each workmen who indulged in acts of violence damaging

not only the property of the hotel but also in preventing the customers from entering into the hotel. The Labour Court also held that the

retrenchment of these workmen was justified and therefore, they are not entitled to any relief. Aggrieved, the worker''s union filed W.P. No. 7606

of 1984.

Before the learned single Judge, it was contended by the learned counsel for the workmen that the retrenchment of the workmen was nothing

but a sheer act of victimisation for forming a Union to vindicate the rights of workmen and that when some of the workmen alone have been taken

back and others, it constituted naked exhibition of hostile discrimination. It also appears to have been contended on behalf of the Union that works

relating to carpentry, painting, plumbing etc., in a hotel is of perennial nature requiring the employment of the whole-time workmen and that such

work cannot be entrusted to contract labour by retrenching the workmen doing such jobs on whole-time basis. The weapon of strike being a

legitimate weapon in the armory of the workmen to vindicate their genuine and legitimate grievances the fact that the workmen indulged in

sympathetic strike is no ground according to the learned counsel for the workers'' Union to terminate their services and the Retrenchment of such

workmen was patently illegal. While traversing the contentions on behalf of the Worker''s Union on merits the learned counsel for the management

appears to have contended that the writ petition deserves to be dismissed solely on the ground of laches in as much as the same came to be filed

challenging the award of the Labour Court after a lapse of more than three years.

The learned single Judge, on a careful consideration and analysis of the findings recorded by the Labour Court in the light of the evidenced

available before the Labour Court, confirmed the findings of the Labour Court after adverting to the relevant decisions on the subject on the view

that no exception could be taken to those findings of the Labour Court that the retrenchment of the workers concerned in the first of the I.Ds. were

brought on account of the management evolving are organisation scheme with the laudable objective of elevating the hotel resort to a star status

either three or five besides affiliating this resort with the interlodge of United States of America to cater to the needs of the foreign tourists and the

forced retrenchment resulting from such reorganisation scheme cannot be said to be invalid. The learned single Judge also adverted to the

requirements of the hotel after re-organisation and qualifications possessed by those retrenched workmen and observed that the action of the

management was bona fide. The fact that the formation of the Union almost synchronized with the re-organisation scheme would not in any manner

undermine the bona fides of the scheme, in the view of the learned single Judge. On an assessment of the various aspects of the matter, the learned

Judge also recorded a finding that it cannot be stated that the act of retrenchment of those personnel which was the subject matter of the first of the

two I.Ds. was part of a scheme of victimisation or unfair labour practice. The learned Judge also was of the view that merely because a few of the

workmen have been taken back, it cannot be said to be a hostile discrimination by the management.

So far as the 8 personnel in the employment of the management pertaining to the categories of artisans like carpentry, painting, plumbing, etc.

are concerned, the learned Judge was of the view that the action of the management ran counter to the object of a social welfare legislation like the

Contract Labour (Regulation and Abolition) Act, 1970. It was also noticed by the learned Judge that the fact that such workers were earlier

employed on full time basis itself was suggestive of the fact that the works concerned were of perennial nature requiring employment of full time

workmen and that therefore, the retrenchment of those personnel was ex-facie illegal as opposed to the very basic tenets as also the principles

adumberated under the Contract Labour (Regulation and Abolition) Act, 1970. To this extent, the learned single Judge interfered with the findings

of the Labour Court and while setting aside that portion of the award, directed the reinstatement in service of those 8 workmen pertaining to the

artisan category barring one painter who has been taken back to the employment of the management. While considering the question of

reinstatement, the learned Judge also adverted to the question of necessity and the need or otherwise for an order relating to the back wages.

Taking into account the nature of their employment and that they were skilled workers with artisan and professional talents needed to every one in

the day to day walk of life, the learned Judge held that they could have been profitably employed and that, therefore, there was no need or

justification for ordering payment of back wages to them upto the date of their reinstatement, and at the same time, the learned Judge thought fit to

ensure to them the benefit of continuity of service and other attendant benefits, if any.

So far as the workers concerned in the second of the I.Ds. who were retrenched for indulging in a sympathetic strike are concerned, the learned

judge was of the view that the strike could not be substantiated by the management to be an illegal one and that the materials produced regarding

the alleged acts by the workmen detrimental to the property and interest of the management were noteworthy of consideration to prove the

allegations. Even in respect of such workers, the learned Judges ordered reinstatement with continuity of service and other attendant benefits only

without back-wages.

As far as the plea of laches pleaded by the management as a ground to reject the writ petition is concerned, the learned single Judge was of the

view that the delay was of no consequence in the absence of any proof of induction of any new personnel on permanent basis in the place of the

retrenched personnel who struck work and that therefore, the writ petition need not be dismissed on that ground. The learned Judge disposed of

the writ petition on the following terms :

Admittedly, the common award under challenge had been passed on 6th May, 1981"". This writ petition challenging the said common Award

had been filed on 23rd July, 1984, that is more than three years after the date of the common award. The delay so caused in filing this writ petition

had, of course, not been explained at all by the petitioner-Union. Utilising such a lacuna, with all vehemence, a bone of contention was resorted to

have been made for dismissal of the writ petition on the ground of laches by learned counsel appearing for the management/second respondent.

Learned counsel appearing for the petitioner-Union, would, however contend that the power of the High Court to issue a proper writ under Art.

226 of the Constitution is of course discretionary and such a power is not ordinarily invoked to permit a belated resort to the extraordinary remedy

because it is likely to cause confusion and public inconvenience and bring in its train new injustices on the rights of third parties by their intervention

in the meantime and that even if public inconvenience and injustice on the rights of third parties are not there, there is no power for this Court to

resort to exercise extraordinary power in entertaining the writ petition, if there is unexplained delay.

Aggrieved, the Workers'' Union as also management have filed the above appeals.

Miss Vedavalle, learned counsel appearing for the management contended that the learned single Judge ought to have rejected the writ petition

on the ground of inordinate delay and laches alone in approaching this Court and committed an error of law in entertaining the writ petition. The

learned counsel further contended that when the fact finding of authority like the Labour Court, on a consideration and appreciation of the oral and

documentary evidence held the termination of the services of the workers in question to be valid in law and justified on facts, it is not open to this

Court exercising jurisdiction under Art. 226 of the Constitution of India to reappreciate the evidence and arrive at totally different findings and on

this ground also, the order of the learned Judge is liable to be set aside. The learned counsel also contended that the reinstatement of the workmen

in question at the belated stage and in circumstances which will be subversive of discipline ought not to have been ordered unmindful of the

difficulties in taking them back when in their places others are working and that the directing of the learned Judge is against the law and cannot be

sustained. Argued the learned counsel further that the learned single Judge and the Labour Court having held that the reorganisation scheme and

reorientation of business to keep it in conformity with the three star grade assigned by the Tourism Department, erred in allowing the claim for

reinstatement and that, therefore, the order of the learned single Judge is liable to be set aside. The learned counsel also placed reliance upon some

of the judicial pronouncements to which a reference will be made hereinafter.

Mr. R. Sankarasubbu, learned counsel for the workers, apart from adopting the reasoning of the learned Judge in the order under challenge

also contended that the learned Judge ought to have also allowed full back wages or at any rate 50% of the backwages. It was also contended by

the learned counsel that in the absence of any disciplinary proceedings for any alleged misconduct, the mere participation in sympathetic strike

cannot be a ground to terminate the services of the workmen straightaway and that the procedure adopted was also violative of Sec. 9-A of the

Industrial Disputes Act, 1947. According to the learned counsel for the workmen, the plea of reorganisation is a mere ruse for getting rid of the

workmen because they have formed a Union for vindicating their service rights and that the fact that some of the workers who also lacked

qualification as suggested by the management were taken back itself and that the substitute workmen also did not possess any other qualifications

which the workers terminated can be said to be lacking is sufficient to show that it is really part of a scheme of victimisation and not either genuine

or bona fide. It was also contended that the workers in question belonged to the last grade servants and the experience possessed by them by

putting in a blemishless service for periods ranging from 3 to 11 years is more than sufficient qualification to justify their retention in service and that,

therefore, no interference is called for with the order of the learned single Judge. According to the learned counsel, the learned Judge ought to have

also allowed the writ petition in its entirety and ordered the reinstatement of those whose claims were rejected, with full back wages and other

attendant benefits. The learned counsel also placed some of the judicial pronouncements in support of his claim made on behalf of the workers.

In Ramchandra Shankar Deodhar and Others Vs. The State of Maharashtra and Others, , a Constitution Bench of the Supreme Court has

held that the rule which says that a court may not inquire into belated or stale claims is not a rule of law but a rule of practice based on sound and

proper exercise of discretion and there is no inviolable rule that whenever there is delay, the court must necessarily refuse to entertain the petition

and that the question is one of discretion to be followed on the facts of each case. It is also observed that the principles on which the court

proceeds in refusing relief to the person who invokes his jurisdiction on the ground of laches or delay is that the rights which have accrued to others

by reason of the delay in filing the petition should not be allowed to be disturbed unless there was reasonable explanation for the delay.

In State of M.P. and Others Vs. Nandlal Jaiswal and Others, , it was held that the power of the High Court to issue an appropriate writ under

Art. 226 of the Constitution is discretionary and the High Court in the exercise of its discretion does not ordinarily assist the tardy and the odolent

or the acquiscent and the lethargic and if there is inordinate delay on the part of the person who approached the court in filing the writ petition, and

such delay is not satisfactorily explained, the High Court may decline to intervene and grant relief in the exercise of its writ jurisdiction. It was also

observed therein that the evolution of this rule of laches or delay is promised upon a number of factors and that an unexplained delay coupled with

the creation of third party rights in the meanwhile is an important factor which always weighs with the High Court deciding whether or not to

exercise such jurisdiction. In G.C. Gupta and Others Vs. N.K. Pandey and Others, , the principles laid down in State of M.P. and Others Vs.

Nandlal Jaiswal and Others, , have been reiterated.

In B.R. Singh and others Vs. Union of India and others, , the Supreme Court held that strike in a given situation is only a form of demonstration

taking different modes like go-slow, sit-in, work-to-rule, absentism, etc., and therefore, the right to demonstrate and the right to strike is an

important weapon in the armoury of the workers and this right has been recognised by almost all democratic countries. On facts, it was held in that

case, the termination of services on account of strike call given out in frustration straightaway without taking any penal action for alleged

misconduct and without even conducting an enquiry but merely imposing the extreme penalty of termination of service was not justified. While

ordering reinstatement, the Apex Court directed reinstatement only, without backwages. In G.T. Lad v. Chemicals & Fibres of India 1079 I LLJ

257, the court was concerned with the case of workers abstaining from work, during strike period who suffered the punishment of termination of

their services. It was held therein that whether there has been abandonment of services voluntarily or otherwise is a question of fact which has to be

determined in the light of the surrounding circumstances of each case and on the facts of the particular case before. Their Lordship of the Supreme

Court, it was held that the absence of workmen from duty to enforce their demands cannot be construed as abandonment and in the absence of

any disciplinary proceeding for alleged misconduct culminating in an order of abandonment, a termination simpliciter cannot be justified.

In Bhagwati Prasad Vs. Delhi State Mineral Development Corporation, , it was held that daily rated workmen of a public sector corporation

who served for considerable length of period are also entitled to regularisation and that all workmen are entitled to equal pay depending upon the

similar nature of the post and discharge of similar duties.

In Workmen of The Food Corporation of India Vs. Food Corporation of India, , it was held by the Apex Court that once some of the

workmen became workmen of the management concerned, it is not open to the management to induct a contractor and treat its workmen as the

workmen of the contractor and that any change in the wages including the period and mode of payment to the disadvantage of the workmen would

constitute violation of sec. 9-A of the Act, unless the procedure therein is observed.

In Parry and Co. Ltd. Vs. P.C. Pal and Others, , it was held that it is within the managerial discretion of an employer to organise and arrange

his business in the manner he considers best and so long as that is done bona fide it is not competent for a Tribunal to question its propriety. It was

also held therein that if a scheme for such reorganisation results in surplus age of employees, no employer is expected to carry the burden of such

economic dead weight and retrenchment has to be accepted inevitable, however, unfortunate it is, of course, subject to other safeguards relating to

the payment of compensation under Sec. 25-F of the Act. It was further held by the Apex Court that a writ of certiorari is generally granted when

a court has acted without or in excess of its jurisdiction and it is also available in those cases where a tribunal, though competent to enter upon an

enquiry, acts in flagrant disregard of the rules of procedure or violates the principle of natural justice where no particular procedure is prescribed.

But a mere wrong decision alone cannot be corrected by the issue of a writ of certiorari as that would be using it as the cloak of an appeal in

disguise.

In Gujarat Steel Tubes Ltd. and Others Vs. Gujarat Steel Tubes Mazdoor Sabha and Others, , it was held that Sec. 11-A of the Industrial

Disputes Act confers the necessary power upon the court or tribunal concerned even to interfere with the quantum of punishment awarded by the

management to the workmen. While dealing with the scope of interference under Art. 226 of the Constitution of India, it was held that every wrong

order cannot be righted merely because it was wrong and it can be quashed only if it is vitiated by the fundamental flaws of gross miscarriage of

justice, absence of legal evidence, perverse misreading of facts, serious errors of law on the face of the order, jurisdictional failure and the like. It

was also observed therein that viewed from the jurisprudential perspective, the Court should be cautions both in not overstepping as if Art. 226 of

the Constitution were as large as an appeal and not failing to intervene where a grave error has crept in.

We have carefully considered the submissions of the learned counsel appearing on either side. Both the Labour Court and the learned single

Judge have categorically held that the scheme for re-organisation of the hotel business particularly to have the same brought in conformity with the

norms and standards fixed by the Department of Tourism to secure the star category status to the hotel is bona fide. We do not see any justifying

reason to go behind those well considered findings. We are also of the view that the re-organisation scheme undertaken is an accidental

coincidence with the move of the workers to form a union and that in any event since the re-organisation scheme is really in furtherance of re-

orientation of the commercial activities and to secure a status to the hotel business itself by securing star category recognition from the Department

of Tourism, the legality or propriety of the same cannot be challenged by the workers. The question of prudence of the management or the wisdom

of the re-organisation scheme are matters normally outside the purview of consideration by this Court proceedings under Art. 226 of the

Constitution of India.

So far as the class of workers belonging to the category of artisans and craftsmen who have been directed to be reinstated by the learned

single Judge is concerned, we are of the view that the conclusions of the learned single Judge cannot be said to be vitiated in any manner. It is not

the case of the management that there was no perennial need or requirement for the services rendered by such category of workers. On the other

hand, what is sought to be contended is that the management wanted to entrust the work on contract basis in the interest of economy and

convenience. When there is perennial need for such works even after the re-organisation of the business and there were already workers who have

been doing those works without any blemish for considerable length of time, it is not given to the management to dispense with their services under

the pretext of entrusting the work to a contractor. In our view, such a stand cannot be said to be a genuine or a bona fide move to interfere with or

to terminate the services of the workers who have put in indisputably a service ranging from 3 years to 11 years. A plea on behalf of the

management that entrusted of such of those works on contract basis is required in order to economise the expenditure is no legal or valid ground to

put an end to the services of those workers. We do not find any error of law in the conclusions arrived at by the learned Single Judge in setting

aside that portion of the award of the Labour Court and directing reinstatement without back wages but with the benefit of continuity of service and

other attendant service benefits, if any. In any event, there could not also have been such discharge without complying with the statutory

requirements of Sec. 25-F of the Act. Equally, the conclusions of the learned Judge in respect of the non-employment of the category of workers

who have undertaken a sympathetic strike also cannot be said to be vitiated. The fact that there was strike and consequent absence of workers

indisputably in token of exhibiting their sympathy to the other workers whose services have been terminated cannot be said to be per se illegal. The

learned single Judge was of the view that no sufficient or proper materials worth credence have been made available to substantiate the claim of the

management about the striking workers indulging in any acts detrimental to the interest of the management. Even that part, the continuous absence

or the alleged indulgence into any illegal activities may not be themselves justify the termination straightaway of their services even in the absence of

a charge, a proper proof of the same in a properly conducted enquiry, with due opportunity to the workers to defend themselves. Unless charges

of any misconduct have been sufficiently established in a proper manner against the workers, the services of such workers cannot be summarily

dispensed with or terminated. In that view of the matter, we do not find any error of law in the conclusions arrived at by the learned single Judge to

interfere with that part of the award of the Labour Court concerning such workers and directing their reinstatement without backwages but, only

with continuity of services and other attendant benefits, if any.

So far as the order of the learned single Judge denying the backwages to even the two groups of workers directed to be reinstated is

concerned it has been vehemently contended by the learned counsel for the Workers'' Union that there was no justification to deny their legitimate

back wages and at any rate to deny the entirely of it and that the learned single Judge ought to have countenanced the claim for at least 50% of the

backwages. We have carefully considered the submission in this regard in the light of the well settled principles governing the award of backwages.

Though normally the award of back wages is an event to follow an order reinstatement after setting aside the order of dismissal or termination, such

denial could be for valid and sufficient reasons on the peculiar fact situation prevailing in a particular case. So far as the case on hand is concerned,

the workers also have unjustifiably created a stalemate in the proper an effective running of the business and the conduct and attitude said to have

exhibited during the course of such disturbing situation cannot be totally ignored for all purposes. Taking into account all these aspects with the

initial indifference, laches and lethargy on the part of the Workers'' Union in diligently approaching this Court after the passing of the award by the

Labour Court, these respect in our view, would constitute sufficient and valid materials to totally deny the backwages. Consequently, in our view

no exception could be taken to the well considered findings of the learned single Judge in this regard, who while denying the backwages, has taken

care to ensure the continuity of service to all these workers. Both the above writ appeals, therefore, have no merit of acceptance and the appellants

in both the appeals are not able to successfully dislodge the conclusions arrived at by the learned Single Judge. These writ appeals, therefore, fail

and shall stand dismissed, but in the circumstances of the case, there will be no order as to costs.