Madras High Court
The Management Of Air France vs The Deputy Commissioner Of Labour ... on 29 January, 1996
Equivalent citations: (1996)IILLJ210MAD
JUDGMENT K.A. Swami, C.J.
1. This appeal is preferred against the order dated September 14, 1992 passed by the learned single Judge in W.P. No. 3388 of 1988, dismissing the writ petition.
2. In the writ petition, the petitioner/appellant sought for quashing the order dated November, 20, 1987 in T.S.E. No. 27 of 1987. The second respondent in the writ petition, who has also been arrayed as second respondent in this appeal, died during the pendency of the appeal and therefore, his legal representatives have been brought on record as respondents 4, 5, & 6 out of them, respondents 5 and 6 are minors and they are represented by the 4th respondent.
3. Though the matter relates to the termination of services of the 2nd respondent, the legal representatives of the deceased have been brought on records, as they would be entitled to the benefits which the deceased would have got, had his (deceased 2nd respondent) services were not terminated.
4. The deceased 2nd respondent was appointed as Sales Officer in the year 1967 initially, and he became District Manager at Madras in the year 1967 and he continued in that position till his services were terminated with effect from April 1, 1987, by the order of termination bearing No. DEL.DA.0411/CC.AC. dated February 27, 1987 issued by the General Manager of the appellant. The entire order has been extracted in the body of the order of the learned single Judge. The services of the 2nd respondent came to be terminated in exercise of the power of the appellant under Clause 8 of the Regulations of the appellant, which reads thus:
8. Termination of employment:
8.1 Resignation-Discharge:
After the expiry of the probationary period, an employee who resigned must give one month's notice, otherwise the company shall be entitled to deduct one month's salary in lieu from the last salary. Conversely, the Company may not discharge any employee, except in case of misconduct, without giving one month's notice, or paying one month's salary.
It is in exercise of that power, the order of termination came to be passed in following terms:
AIR FRANCE General Management - India and Nepal 50-B Chanakyapuri. New Delhi- 110021. Phone: 604775 - Grams: Airfrans Telex: 2480 Del.DA.0411/CC.AC Mr. K.R. Gopalan, 68, Abhiramapuram IV Street, Madras-600018.
Re: Notice of termination of services. Registered A/D, New Delhi February 27, 1987. Sir, In terms of our agreement clause 8 we hereby terminate your services in Air France with effect from March 31, 1987. SD.P.J.L.E.BORGNE, General Manager.
5. Aggrieved by the aforesaid order, tne deceased 2nd respondent preferred an appeal to the 1st respondent, who by the order dated November 20, 1987 allowed the appeal and set aside the order of termination, passed by the appellant-management.
6. There cannot be any dispute that the result of the order of the 1 st respondent is only to demolish the order of termination but also to reinstate him(2nd respondent) into service, because the hiatus that was created by the order of termination of services of the 2nd respondent disappeared. Consequently, he (2nd respondent) should be deemed to have been in continuous service. In such circumstances, the appellants/Management approached this Court in W.P.No. 3388 of 1988.
7. Before the appellate authority as well as in the writ petition, the following contentions were raised:
1) Section 41(2) of the Tamil Nadu Shops and Establishments Act 1947 was not attracted in view of the fact that the deceased 2nd respondent was working in the managerial cadre of the appellant and the Sub-clause (a) of Clause (1) of Section 4 of the Tamil Nadu Shops and Establishments Act, 1947 , hereinafter referred to as the Act, did not apply to persons employed in any establishments in a position of management. They also challenged the validity of the notification issued by the Governor ot Madras in exercise of the power conferred by Section 5 of the Act, under G.O.Ms.No. 4074, Industries, Labour and Housing (Labour) dated October 5, 1966 on the ground that when the legislature in its wisdom had exempted from the provisions of the Act. all the persons employed in any establishment in a position of management, the State Government should not have issued the aforesaid Notification, contrary to the provisions contained in Section 4(1)(a) of the Act. However, it is relevant to notice that Section 5 of the Act, empowers the State Government to apply the provisions of the Act to exempted persons or establishments. The said provision reads thus:
5. Power of Government to apply to exempted persons or establishments:
Notwithstanding any thing contained in Section 4, the State Governments may by notification apply all or any of the provisions of this Act to any class of persons or establishments mentioned in that Section, other than those mentioned in Clause (c) and (f) of Sub-section (1) and modify or cancel any such notification.
8. In view of the aforesaid provision, the State Government was well within its power in applying the provisions of the Act, irrespective of the provision contained in Clause 4(1) (a) of the Act, because Section 5 of the act specifically empowers the State Government in this regard. Normally such an enactment empowers the State Governments to apply or exempt certain provisions of the Act. In the instant case, the legislature has exempted certain categories of establishments and persons, but at the same time empowers the State Government to take away those exemptions other than those mentioned in Sub-clause (c) and (f) of Sub- section (1) Section 4 of the Act and also to modify any such notification. Therefore, by no stretch of imagination or logically it can be argued that the State Government acted without the authority of law having regard to the provisions contained in Section 5 of the Act. Further, it cannot also be argued that Section 5 of the Act was beyond the legislative power of the State Legislature because when Section 4 of the Act is undisputably within the legislative power of the State Government, it goes without saying that the Legislature can also take away the exemptions granted, which it has done by reason of making a provision under Section 5 of the Act.
9. Hence, we are of the view, that the notification issued by the State Government under Section 5 of the Act cannot be held to suffer from any infirmity, much less the lack of legislative power of the State Legislature. Once it is held that the notification dated October 5, 1966 is valid, then the provisions of Section 41 of the Act are attracted. Therefore the contention of the appellant that the appeal filed by the second Respondent before the appellate authority was not maintainable, as the provisions of Section 41 were not attracted, is knocked down.
10. The next question for consideration is as to the validity of the order of termination. It is submitted, by Mr. S. Govind Swaminathan, learned Senior Counsel for the appellant that the appellant has acted in accordance with the terms of the Articles as contained in Clause 8 of the Regulations, and therefore, the termination of the 2nd respondent cannot be held to be invalid. In the earlier part of our judgment we have extracted Clause 8(1) of the Regulations which empowers the management to terminate the services of any employee or person, without giving any reason, but by giving one month's notice. In the instant case, the termination notice came to be issued on February 27, 1987. It is not disputed before us that the same was received by the deceased second respondent on the same date and therefore, there was clear one month's notice before the order of termination came into effect on March 31, 1987.
11. The question for consideration is whether such a termination notice is valid in the light of the provisions contained in Section 41(1) of the Act. Section 41(1) of the Act reads thus:
41. Notice of dismissal:- (1) No employer shall dispense with the services of a person employed continuously for a period of not less than six months, except for a reasonable cause and without giving such persons at least one month's notice or wages in lieu of such notice, provided however, that such notice shall not be necessary where the services of such persons are dispensed with on a charge of misconduct supported by satisfactory evidence recorded at an enquiry held for the purpose.
12. It is not in dispute that the deceased 2nd respondent was in service continuously for a period more than six months, by the time his services were terminated. That being so, the services of the 2nd respondent should not have been terminated, except for a reasonable cause. In this case, we need not go into the question, whether such a reasonable cause, if it is not contained in the notice, can be proved by any evidence ali-unde, because such is not the defence set up. Therefore, we have to go by the contents of the notice, which we have extracted in the earlier part of our judgment, and it does not contain any reason much less reasonable cause. That being so, the notice of termination is clearly violative of Section 41 of the Act. When the law prescribes that certain condition/s should be satisfied before exercising certain power or passing an order, such condition, become condition precedents, the non-compliance of the same would result in making that act itself invalid. Therefore, in the instant case, as the reasonable cause for termination is neither stated in the notice nor any material has been placed before us that there existed a reasonable cause, on the date when the notice of termination was issued to the deceased 2nd respondent. (However we should not be taken to have expressed finally as to whether it would be permissible to prove by evidence aliunde the existence of a reasonable cause in a case where the notice of the termination does not contain any reason because that has not been argued before us and that it is not the case of the appellant).
13. In addition, to this the learned single Judge has also referred to a decision of this Court, considering the absence of reasons in the notice issued, terminating the services, in the light of the provisions contained in Section 41 of the Act, as the same are relevant, we refer to them.
14. In The Tata Iron and Steel Co. Ltd., case (1950-II-LLJ- 1043), a Division Bench of this Court has held as follows:
Under Section 41(1) of the Act, the services of a person like the first respondent who has been employed continuously for over a period of six months, can be dispensed with for a reasonable cause after giving the person atleast a month's notice or wages in lieu of such notice or on a charge of misconduct supported by satisfactory evidence recorded at an enquiry held for the purpose in which case notice would not be necessary. From the order of the company dispensing with the services of the first respondent the only reason appearing is the non requirement of his services. The order does not state anything else. The only question therefore for the appellate authority was to determine whether that ground can be said to be a reasonable cause. The authority held that it could not be and we agree with him.
Similarly in State Bank of Travancore v. Deputy Commissioner of Labour Coimbatore (1981-I-LLJ-393) this Court has held as follows: at P 395 The first ground is that the proceedings under Section 41 of the Act before the first respondent are incompetent because the petitioner has passed the order of termination against the second respondent under paragraph 522(1) of the Sastri Award. His submission is not tenable because it cannot be disputed that so far as the employment in question is concerned, the provisions of the Act are definitely attracted. The petitioner satisfies the definition of an employer and the second respondent satisfies the definition of a person employed within the meaning of the Act, and any contract between the employer and the person employed cannot override the express provisions of the Act or in particular Section 41 thereof. The learned counsel for the petitioner is not in a position to cite any direct authority that wherever there is a contract governing the relationship between the employer and the person employed the provisions of the act will have to be ignored and there is no necessity to adhere to and satisfy the formalities laid down under Section 41 of the Act, Hence, I am not able to appreciate and accept the first contention of the learned counsel for the petitioner...... that even otherwise the petitioner has dispensed with the services of the second respondent for a reasonable cause and there has been strict compliance with the first limb of Sub-section (1) of Section 41 of the Act, in the sense the second respondent has been paid more than a month's wages in lieu of the notice contemplated. In the instant case a memo was issued to the second respondent on May 11, 1976 and an explanation was obtained on June 10, 1976. The order of termination dated March 17, 1977, does not disclose as to whether the explanation was accepted or not and the factors which weighed with the petitioner to pass the order of termination on the basis of reasonable cause. If the termination is to be on the ground of reasonable cause, it is incumbent on the part of the employer to disclose the reasonable cause in the order of termination and in the absence of a disclosure it is not possible for any authority, and in particular the Appellate Authority under Section 41(2) of the Act to determine as to whether the grounds put forth by the employer can be stated to constitute a reasonable cause as to whether the order of termination has been passed bonafide. The necessity to disclose the reasonable cause and in the order of termination has been stressed by a Bench of this Court in Tata Iron and Steel Co. Ltd., (supra)
15. We are in entire agreement with the aforesaid decisions, as it is clear that it is mandatory on the part of the management, while dispensing with the services of a person, who has put in continuous period of service for more than six months, to assign reasonable cause for termination.
16. Thus, we are of the view, that the conclusion reached by the learned single Judge does not suffer from any infirmity and consequently, the order of the learned single Judge affirming the order of the Appellate Authority in T.S.E.No. 27 of 1987 dated November 20, 1987 does not call for interference. Accordingly, the appeal fails and is dismissed. As a result of it, what the legal representatives of the deceased second respondent would be entitled to is a matter of determination under Section 33-C of the Industrial Disputes Act, and we keep that question open and reserve liberty to respondents 4 to 6, the legal representatives of the deceased second respondent, to approach to the Industrial Tribunal. We also make it clear to whatever the amounts so far paid by the appellant pursuant to the directions issued by this Court, are directed to be adjusted in the award/order that may be passed by the Industrial Tribunal. Consequently, C.M.P. Nos.785 of 1993, 3410 to 3412 of 1995 are also disposed of. No Costs.