M/S. Lokmat Newspapers Pvt. Ltd vs Shankarprasad

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That is how the listed workmen, including the respondent herein, were sought to be discharged from service. Thus the foundation of the impugned order of discharge is the notice under Section 9-A dated 25th March, 1982. Once that foundation is knocked off as incompetent, illegal and uncalled for the entire edifice of retrenchment order against the respondent falls to the ground.

It may also be noted at this stage that by two decisions rendered by Bench of three learned Judges of this Court in connection with the time for issuance of notice under Section 9-A read with item 10 Schedule IV with which we are concerned in the present case it has been clearly ruled that such notice must precede the introduction of rationalisation scheme. We may usefully refer to them at this stage. In the case of M/s. North Brook Jute Co. Ltd. & Anr. vs. Their Workmen (1960 (3) S.C.R. 364), a three Judge Bench of this Court had to consider the question whether in a reference regarding proposed introduction of rationalisation scheme which was preceded by notice under Section 9-A of the I.D. Act, such a scheme could be actually introduced pending reference proceedings and whether such an act on the part of the management could be treated to be illegal entitling the workmen affected by such an introduction to go on strike and still earn wages for the strike period. Answering this question in affirmative it was held by this Court that after notice under Section 9-A of the I.D. Act when a scheme of rationalisation was said to be introduced but was not actually introduced it could not be introduced till the dispute regarding such proposed introduction was resolved by the competent Court. Dealing with the scheme of proposed rationalisation as envisaged by item no.10 of Schedule IV of the I.D. Act it was observed that :

"Rationalisation which was introduced had therefore two effects- first that some workers would become surplus and would face discharge; and secondly, the other workmen would have to carry more workload. The introduction of the rationalisation scheme was therefore clearly an alteration of conditions of service to the prejudice of the workmen. The alteration was made on the 16th December, when reference as regards the scheme had already been made and was pending before the Industrial Tribunal. The Tribunal has therefore rightly held that this introduction was a contravention of s. 33."

The aforesaid decision, therefore, has clearly ruled that introduction of rationalised scheme by itself would amount to alteration of conditions of service of the workmen to their prejudice. It, therefore, follows that before effecting such a change, meaning thereby, before introducing such a rationalisation scheme which has a tendency to change the conditions of service of workmen, notice under Section 9-A as a condition precedent becomes a must. If learned counsel for the appellant is right, that machine can be introduced on experimental basis first or even after it has already worked for some time and is required to be continued as a full-fledged machine, as and when the employer decides to terminate the services of the workmen as a direct consequence of such introduction of machine, he can give notice under Section 9-A of the Act at any such time, then the very scheme of Section 9-A read with Schedule IV item no.10 of the I.D. Act would be rendered ineffective and inoperative. The purpose of issuing such a notice prior to the introduction of the scheme of rationalisation would get frustrated and then there would remain no effective opportunity for the conciliator to try to arrive at an amicable settlement regarding the dispute centering round the proposed introduction of the scheme of rationalisation which is likely to result in the retrenchment of workmen. Equally there would remain no opportunity for the State Government on receipt of failure report from the conciliator to make a reference of such live industrial dispute for adjudication by the competent Court on merits. It is obvious that when such dispute regarding the proposed introduction of the rationalisation scheme is referred for adjudication of the competent Court, the said Court after hearing the parties and considering the evidence can come to the conclusion whether the proposed scheme is justified on facts or not and whether any violation of the provisions of Section 9-A had resulted into illegality of the consequential orders of retrenchment. Such competent Court can also accordingly pass appropriate consequential orders directing the management to withdraw such a scheme of rationalisation or in any case, can order reinstatement of workmen with proper back-wages if such retrenchment is found to be illegal on account of failure to comply with the provisions of Section 9-A of the Act. The question regarding the stage at which notice under Section 9-A can be issued in connection with proposed scheme of rationalisation which has likelihood of rendering existing workmen surplus and liable to retrenchment as mentioned in item no.10 of Schedule IV of the I.D. Act was once again examined by a three judge bench of this Court in Hindustan Lever Ltd. vs. Ram Mohan Ray & Ors. (1973 (4) SCC 141). In that case, this Court was concerned with a scheme of rationalisation and re-organisation which were proposed to be introduced by Hindustan Lever Ltd., appellant before this court, and for which a prior notice under Section 9-A before introducing such re- organisation scheme was issued to the workmen but which had no tendency or likelihood of displacing or retrenching them. It was the contention of the workmen that even for such a scheme a notice under Section 9-A was a must. Examining the scheme of reorganisation in question, it was held that once the scheme was not likely to result in retrenchment of any workman Section 9-A read with item no.10 of Schedule IV did not get attracted on the facts of the case. In this connection the following pertinent observations on the scheme of Section 9-A read with item no.10 of Schedule IV were made by Alagiriswami J., while dealing with the contention of learned counsel for the workmen :

"He also urged that rationalisation and standardisation per se would fall under item 10 even if they were not likely to lead to retrenchment of workmen and only improvement of plant or technique would require that they should lead to retrenchment of workmen in order to fall under item 10. A further submission of his was that standardisation merely meant standardisation of wages. We are not able to accept this argument. It appears to us that the arrangement of words and phrases in that item shows that only rationalisation or standardisation or improvement of plant or technique, which is likely to lead to retrenchment of workmen would fall under that item. In other words, rationalisation or standardisation by itself would not fall under item 10 unless it is likely to lead to retrenchment of workmen. The reference to rationalisation at page 257 of the report of the Labour Commission and the reference to standardisation of wages in it are not very helpful in this connection. Standardisation can be of anything, not necessarily of wages. It may be standardisation of workload, standardisation of product, standardisation of working hours or standardisation of leave privileges. Indeed in one decision in Alembic Chemical Works Co. Ltd. v. The Workmen, there is reference to standardisation of conditions of service, standardisation of hours of work, wage structure. That case itself was concerned with standardisation of leave. The whole question whether this reorganisation falls under item 10 depends upon whether it was likely to lead to retrenchment of workmen."

In view of the aforesaid decision, it becomes obvious that if the proposed scheme of rationalisation has a likelihood of rendering existing workmen surplus and liable to retrenchment, then item no.10 of Schedule IV would squarely get attracted and would require as a condition precedent to introduction of such a scheme a notice to be issued under Section 9-A by the management proposing such an introduction of the scheme of rationalisation, but if the proposed scheme is not likely to displace any existing workmen then mere rationalisation which has no nexus with the possibility of future retrenchment of workmen would not attract item no.10 of Schedule IV and would remain a benign scheme of rationalisation having no pernicious effect on the existing working staff. In view of the aforesaid settled legal position, there is no escape from the conclusion that the impugned notice dated 25th March, 1982 under Section 9-A which was issued long after the actual installation of the photo composing machine had fallen foul on the touchstone of Section 9-A read with Schedule IV item no.10. Such a notice in order to become valid and legal must have preceded introduction of such a machine and could not have followed the actual installation and effective commission of such a machine. The decision rendered by the Division Bench in this connection is found to be perfectly justified both on facts and in law. It must, therefore, be held that the impugned termination or discharge of the respondent was violative of the provisions of Section 9-A of the I.D. Act and he was discharged from service without the appellant's following the mandatory requirements of Section 9-A of the I.D. Act. Effect of non-compliance of Section 9-A of the I.D. Act renders the change in conditions of service void ab initio. This legal position is well settled in the case of Workmen of the Food Corporation of India vs. Food Corporation of India [(1985) (2) SCC 136], a three Judge Bench of this Court, speaking through Desai J., in para 19 of the report, laid down as under :- "It is at this stage necessary to examine the implication of Section 9-A of the I.D. Act, 1947. As hereinbefore pointed out, Section 9-A makes it obligatory upon an employer who proposes to effect any change in the conditions of service applicable to any workman in respect of any matter specified in the Fourth Schedule to give a notice of desired or intended change. It cannot do so without giving to the workman likely to be affected by the change, a notice in the prescribed manner of the nature of the change proposed to be effected and within 21 days of giving such notice. There is a proviso to Section 9-A which has no relevance here.

Xxxxxx xxxxx xxxxx Xxxxxxx xxxxx xxxxx

Therefore, obviously a notice of change was a must before introducing the change, otherwise it would be an illegal change. Any such illegal change invites a penalty under Section 31(2) of the I.D. Act, 1947. Such a change which is punishable as a criminal offence would obviously be an illegal change. It must be held that without anything more such an illegal change would be wholly ineffective."

Point No.3, therefore, is answered in affirmative against the appellant and in favour of the respondent.

Point No.4: It has to be kept in view that the present proceedings arise out of a complaint filed by the respondent-workman alleging `unfair labour practice' on the part of the appellant-management when it passed the impugned order of retrenchment against him.

The said complaint was moved under Section 28 of the Maharashtra Act. The topic of `unfair labour practice' is dealt with in Chapter VI of the said Act. Section 26 is the first section in the said chapter which provides as follows : "`unfair labour practices:- In this Act, unless the context requires otherwise, `unfair labour practices' mean any of the practices listed in Schedules II, III and IV."

Section 27 lays down as follows : "Prohibition on engaging in unfair labour practices:- No employer or union and no employee shall engage in any unfair labour practice."

Section 28 lays down the procedure for dealing with complaints relating to `unfair labour practices'. Sub-section (1) thereof provides as follows :- "(1) Where any person has engaged in or is engaging in any unfair labour practice, then any union or any employee or any employer or any Investigating Officer may, within ninety days of the occurrence of such `unfair labour practice', file a complaint before the Court competent to deal with such complaint either under section 5, or as the case may be, under section 7, of this Act:

Provided that, the Court may entertain a complaint after the period of ninety days from the date of the alleged occurrence, if good and sufficient reasons are shown by the complainant for the late filing of the complaint."

It is not in dispute in this case that the respondent invoked the jurisdiction of the Labour Court which was competent to deal with his complaint regarding `unfair labour practice', under items 1 (a), (b), (d) and (f) of Schedule IV of the Maharashtra Act. Section 7 of the Act lays down the duties of Labour Court and states as under :-

"It shall be the duty of the Labour Court to decide complaints relating to unfair labour practices described in item 1 of Schedule IV and to try offences punishable under this Act."

When we turn to Schedule IV item no.1, we find therein listed number of heads of `unfair labour practice's which can support any complaint thereunder. The relevant clauses of item no.1 of Schedule IV which were invoked by the respondent for supporting his complaint against the impugned retrenchment order were clauses (a), (b), (d) and (f). Item no.1 with all its sub-clauses reads as under :- "To discharge or dismiss employees - (a) by way of victimisation; (b) not in good faith, but in the colourable exercise of the employer's rights; (c) by falsely implicating an employee in a criminal case on false evidence or on concocted evidence; (d) for patently false reasons; (e) on untrue or trumped up allegations of absence without leave; (f) in utter disregard of the principles of natural justice in the conduct of domestic enquiry or with undue haste; (g) for misconduct of a minor or technical character, without having any regard to the nature of the particular misconduct or the past record of service of the employee, so as to amount to a shockingly disproportionate punishment."

We have, therefore, to see as to whether in the light of our findings on point nos.2 and 3 the respondent could rely upon any of these clauses of item no.1 of Schedule IV in support of his complaint. Now a mere look at the aforesaid provision shows that an employee who makes a grievance against order of discharge or dismissal passed against him can invoke any of the listed clauses (a) to (g) of item no.1 of Schedule IV. Learned counsel for the appellant was, therefore, right when he contended that first it should be alleged by the complainant-employee that he was discharged or dismissed from service by the employer and then he has to further show whether such an order attracted any of the clauses (a) to (g) of item no.1 of Schedule IV. Learned counsel for the appellant, in this connection, vehemently contended that item no. 1 of Schedule IV of the Maharashtra Act deals with only punitive discharges or dismissals and not any simpliciter discharge order or termination order which is not passed by way of punishment. In order to support this contention, learned counsel for the appellant relied upon principles of interpretation, namely, the principle of noscitur a sociis as well as the principle of ejusdem generis. So far as the first principle of interpretation is concerned, he referred to "Maxwell on The Interpretation of Statutes", 12th Edition at page 289 dealing with the question regarding understanding associated words in common sense. The learned author in connection with this principle has made the aforesaid pertinent observations : "Where two or more words which are susceptible of analogous meaning are coupled together, noscuntur a sociis. They are understood to be used in their cognate sense. They take, as it were, their colour from each other, the meaning of the more general being restricted to a sense analogous to that of the less general. (One application of this general principle is the ejusdem generis rule, which is discussed in the next section of this chapter.)"

It becomes, therefore, obvious that before this principle of interpretation can be pressed in service, it must be shown that both the words `discharge and dismissal' are employed by the Legislature in Schedule IV item no.1 in the same sense or that they are susceptible of analogous meaning. This rule of construction in other words lays down as follows : "The meaning of a word is to be judged by the company it keeps."

As held by this Court in the case of M.K. Ranganathan & Anr vs. Govt. of Madras & Ors. (AIR 1955 SC 604 at 609) relying upon Privy Council decision in `Angus Robertson v. George Day', [(1879) 5 AC 63 at p 69 (E)]: "It is a legitimate rule of construction to construe words in an Act of Parliament with reference to words found in immediate connection with them".

Keeping in view this well settled principle of construction of statutes, let us see whether in the settings of item no.1 clauses (a) to (g) the word `discharge' as employed by the Legislature has meaning analogous to that of the word `dismiss'. When we have a close look at clauses

(a) to (g) of item no.1 of Schedule IV, we find that the word `discharge' is not intended by the Legislature to have the same or analogous meaning as the word `dismiss'. The reason is obvious. The word `dismiss' necessarily connotes an action of the employer who seeks to impose punishment on his mis- conducting employee. Such a punishment cannot be imposed without following the principles of natural justice and the relevant applicable rules of domestic inquiry. But the word `discharge' is not necessarily confined to orders of termination by way of penalty only. The word `discharge' has wider connotations. A mis-conducting employee facing charges in a domestic inquiry may be punished by way of imposing on him an order of dismissal which may make him ineligible for any other employment but if it is found that the charges which are proved are not that serious but the employee would not deserve to be continued in service then an order of discharge by way of lesser penalty can be imposed on him. Such an order would remain a punitive discharge. Thereby the employer wants to punish the employee for his misconduct but does not want him to become ineligible for employment elsewhere considering less serious nature of proved charges of misconduct against him in domestic inquiry. But that is not the end of the matter. In service jurisprudence the term `discharge' has assumed a wider connotation and may include in its fold not only punitive discharge orders but also simpliciter discharge orders where the employer seeks to snap the relationship of employer and employee but without any intention to penalise the employee. He does so because of exigencies of service and employment conditions which may require him to say goodbye to the employee but without any intention to punish him. Such simpliciter discharge orders can be illustrated as under :

An employee, on probation, may not be found to be suitable and may not earn sufficient merit so as to be confirmed in service. Consequently, his probation may be terminated and an order of discharge simpliciter can be passed against him. There may also be other cases of single discharge under the contract of employment for a fixed period where an employee on efflux of time may be terminated. There may also be cases where an employee may become surplus and would no longer be required by the employer. An order of retrenchment, therefore, may be passed against him subject, of course, to following the statutory requirements of Section 25-F and 25-G of the I.D. Act if they are applicable. These illustrations are not exhaustive but they indicate such orders of discharge are passed by an employer who does not want to punish the employees but still is not in a position to continue them in service. Such simpliciter discharge orders are also a category of discharge orders. Therefore, the word `discharge' as employed by the Legislature in item no.1 of Schedule IV cannot necessarily be confined only to punitive discharges as tried to be submitted by learned counsel for the appellant. Once we consider the words `discharge' or `dismissal' as employed in the opening part of item no.1 by the Legislature in the light of various clauses representing different situations under which such discharge or dismissal orders are said to amount to `unfair labour practice' on the part of the employers, it becomes at once clear that the Legislature was not contemplating only punitive discharge orders but was contemplating both types of discharge orders, namely, punitive as well as non-punitive discharge orders.

The very first item (`a') deals with the discharge or dismissal order passed by way of victimisation of the employee. It is easy to visualise that an employer may like to dispense with the services of an employee who, according to him, is a trouble maker. He may not have been involved in any misconduct as such still by way of putting an end to his service on extraneous reasons, if an order of discharge is passed it may remain simpliciter order of discharge but if it is found based on extraneous reasons it would be by way of victimisation. Such a discharge order may not necessarily be a punitive discharge order. The employer would not like to punish the employee for any of his misconduct but would not like him to continue in service as according to the employer he may be an undesirable person not suitable to the management is for example a militant trade union leader who, according to the employer, is any how to be required to be sent out of service. When such type of discharge orders are passed by way of victimisation they would be simpliciter discharge orders when not backed up by relevant reasons. It cannot be said that such simpliciter discharge orders are not covered by item `1' clause (`a') of Schedule IV. Similarly clause (`b') may contemplate a discharge order which is not passed in good faith but in the colourable exercise of employer's rights. Thus, the employer may have merely a pretext to put an end to the service of the employee who may not have misconducted himself at all. Therefore, there will be no occasion to have any departmental inquiry against him as no charge could be framed regarding any misconduct on his part. Still if such an undesirable employee is to be removed from service then even though the simpliciter discharge order is passed if it is shown that it is not in good faith but as a result of malafide intention of the employer, then such a discharge order can also attract the category of `unfair labour practice' as enacted by the Legislature in item nos. (`a') and (`b'). Similar Legislature scheme is discernible from clause (c) of item no. 1 which deals with an order of discharge or dismissal by falsely implicating an employee in a criminal case on false evidence or on concreted evidence. In such a situation discharge or dismissal order may operate as a penal order. Similarly, clause (d) may cover cases which are orders of discharge or dismissal by way of penalty as well as simpliciter discharge orders based on a patently false reasons. Clause (e) referring to discharge or dismissal may cover both the cases of dismissal by way of penalty on such grounds or discharge by way of penalty on such grounds and equally a discharge order simplicitor on account of false allegations of absence without leave. So far as Clause (f) is concerned, the first part squarely covers a case of dismissal or discharge by way of penalty as it deals with such orders passed after conducting domestic inquiry about the alleged misconduct of the employee but in utter disregard of the principles of natural justice but so far as the second part of clause (f) of item no.1 is concerned, if an employee is dismissed with undue haste it may be by way of penalty as in domestic inquiry apart from following the principles of natural justice, sufficient and reasonable opportunity to defend may be denied to the employee and with undue haste the dismissal order may be passed. That would obviously be a penal order but so far as discharge order is concerned, it may also be passed by way of penalty with undue haste but the said part of clause (f) may equally cover those discharge orders which are simpliciter discharge orders not by way of penalty but still being passed with undue haste on the part of the employer who may not be wishing to punish the employee but wishing to say goodbye to the employee on the ground that he is otherwise an unwanted person. Such discharge orders passed with undue haste may not necessarily be penal and still may amount to `unfair labour practice' if they are passed with undue haste. Clause (g) of item no.1 obviously refers to only discharge or dismissal orders which are penal in nature as they have a direct linkage with misconduct of the employee.

The aforesaid resume of various clauses of item no.1 of Schedule IV leaves no room for doubt that when the Legislature used the words `discharge' or `dismissal' of the employees under circumstances enumerated in clauses (a) to

(g) in item no.1 of Schedule IV it contemplated dismissal orders which obviously are penal in nature but it also contemplated discharge orders which may either be penal or non- penal in nature and still if any of the relevant clauses of item no. 1 got attracted in connection with such discharge orders they would make the employer, author of such discharge orders answerable for the alleged `unfair labour practice' permeating the passing of such simpliciter discharge orders. To recapitulate, in the present case, respondent's complaint is not that his discharge was by way of penalty but his complaint is that the discharge order in his case was a result of victimisation and was not passed in good faith but was passed on patently false reasons and was a result of undue haste on the part of the appellant-employer. Whether the said complaint was justified on merits or not is a different matter but it can not be said that such a complaint regarding non-penal discharge order was dehors the scope and ambit of item no.1 of Schedule IV of the Maharashtra Act. Before parting with the discussion on this aspect we may mention that learned counsel for the appellant also relied upon the other rule of interpretation, namely, rule of ejusdem generis. The said rule of interpretation provides as follows :

"When particular words pertaining to a class, category or genus are followed by general words, the general words are construed as limited to things of the same kind as those specified. This rule which is known as the rule of ejusdem generis reflects an attempt "to reconcile incompatibility between the specific and general words in view of the other rules of interpretation that all words in a statute are given effect if possible, that a statute is to be construed as a whole and that no words in a statute are presumed to be superfluous".

It is difficult to appreciate how this principle of interpretation can be invoked by learned counsel for the appellant in connection with item no.1 of Schedule IV. The word `discharge' is a general word. It is followed by the word `dismissal' which contemplates only one category of cases or situations where penalty is imposed by the employer on the workmen concerned. The rule of ejusdem generis would have applied if the word `discharge' represented a particular species belonging to the genus reflected by the general word `dismiss'. This is a converse case where a general word `discharge' is followed by the word `dismiss' which is of a particular nature or pertains to a limited class or category of penal situations. Obviously, therefore, neither of them is a genus and nor of them is a species of the very same genus. The word `discharge' connotes an entirely different category of orders comprising of both simpliciter discharge orders not by way of penalty as well as discharge orders by way of penalty but not involving extremely pernicious results flowing from such orders while the word `dismiss' is purely an order of penalty and that too of an extreme type. Consequently, the aforesaid rule of interpretation cannot be of any avail to learned senior counsel for the appellant. On the contrary, as seen by us earlier, the words `discharge' and `dismissal' as employed by the Legislature in item no.1 of Schedule IV covered different types of situations and circumstances under which they are passed. It is, therefore, not possible to agree with the submission of learned senior counsel for the appellant that unless the respondent shows that he was discharged by way of penalty, he cannot invoke any of the clauses of item no.1 of Schedule IV.

Before leaving the discussion on this aspect, we may refer to a decision of this Court on which strong reliance was placed by learned counsel for the appellant. In the decision of the Constitutional Bench of this Court in State of Rajasthan & Anr. vs. Sripal Jain, (1964 (1) SCR 742), this Court was concerned with the interpretation of Rule 244(2) of the Rajasthan Service Rules read with rule 31(vii)

(a) of the Rules. In the light of the said statutory scheme of these Rules, the Court made the following pertinent observations :

"Held, that compulsory retirement provided in r. 31(vii)(a) is a compulsory retirement as a penalty and not compulsory retirement of the other two kinds namely (1) Compulsory retirement on attaining the age of superannuation and (2) compulsory retirement under r.244(2), neither of which is a punishment."

It is difficult to appreciate how the said decision rendered on the special scheme considered by this Court in that case can be of any assistance to learned counsel in the present case. The scheme with which we are concerned contraindicates any such conclusion as tried to be pressed in service by learned counsel in support of his contention that the word `discharge' is used synonymously or analogously by the Legislature along with the word `dismissal'. It is also well settled that the word `discharge' may not only be by way of penalty. Discharge of a probationer on unsuitability, as noted earlier, would not be by way of penalty. Similarly, even in case of compulsory retirement as laid down by a catena of decisions of this Court in the context of the relevant statutory rules, this action may not be penal. In this connection, we may refer to a decision of this Court in K.Kandaswamy vs. Union of India & Anr., (JT 1995 (7) S.C. 80), wherein it has been observed that "..Compulsory retirement does not amount to dismissal or removal from service within the meaning of Article 311 of the Constitution. It is neither punishment nor visits with loss of retiral benefits ; nor does it cast stigma."

Consequently, it cannot be held that wherever the word `discharge' is used in any statutory instrument it must necessarily connote a penal discharge as tried to be submitted by learned counsel for the appellant. In the case of High Court of Judicature at Patna vs. Pandey Madan Mohan Prasad Sinha & Ors. [(1997) 10 SCC 409], it has been held by the Bench of this Court that if a probationer is discharged on the ground of unsuitability, the said order can be challenged only on the ground that it is arbitrary or punitive. If it is not punitive then such an order cannot be challenged at all. It is further observed that principles of natural justice have no application in case of termination of services of a probationer during the period of probation since he has no right to hold that post. In such case, it is obvious that discharge of such a probationer on the ground of unsuitability cannot be treated to be a punitive discharge.

Once this ground is cleared, the arena of contest between the parties becomes well defined. It has to be pleaded and proved by the respondent-complainant that though the order of termination or retrenchment was not passed by way of penalty by the appellant, it attracted all or any of the clauses (a),(b),(d) & (f) of item no.1 of Schedule IV as his complaint was based on these clauses only. In the light of the evidence which is on record and on which there is no dispute between the parties, it becomes clear that the appellant wanted to switch over to the process of composing by utilising photo type-setting machine and in the process the hand composing department engaging respondent and other workmen had to be wound up. That naturally resulted in the employees in the erstwhile hand composing department becoming excess and surplus. That is the reason why impugned notice under Section 9-A of the I.D. Act was issued to the respondent and other workmen and ultimately resulted in the impugned retrenchment order. It is difficult to appreciate how such an action on the part of the appellant can be treated to have been the result of victimisation. The respondent was not being victimised for any extraneous reason. On the contrary, it was based on a genuine factual reason. Hence clause (a) of item no.1 of Schedule IV is out of picture. Parameters of the term `victimisation' have been considered by a three Judge Bench of this Court in the case of Colour-chem Limited vs. A.L. Alaspurkar & Ors. [1998 (1) Scale 432], where one of us, S.B.Majmudar J., speaking for the Bench in para 13 of the report observed that the term `victimisation' is a term of comprehensive import. Thus, if a person is made to suffer by treatment, it would amount to victimisation. On the facts of the present case, therefore, it is not possible to hold that the impugned discharge of the respondent was based on non-germane or extraneous reasons or it was passed with a view to make the respondent suffer for no real reason.

It is, therefore, not possible to agree with the reason of the Division Bench of the High Court in the impugned judgment that the action of the appellant was by way of victimisation of the respondent. Item no.1 clause

(a) of Schedule IV, therefore, does not apply to the facts of the present case.

On a parity of reasoning it has to be held that the discharge of the respondent from service cannot be said to be not in good faith but in the colourable exercise of employer's rights. It cannot be gainsaid that the appellant had good reason to discharge the respondent who was rendered surplus in hand composing department because of the introduction of the machine in question. It is difficult to impute any bad faith to the appellant as the appellant tried its best to provide alternative job to the respondent at Jalgaon but the said offer was not accepted by the respondent and, on the contrary, the transfer order was got declared illegal and an act of `unfair labour practice' in proceedings culminating before the Tribunal. Clause (b) of item no.1 of Schedule IV, therefore, is also not attracted on the facts of the present case. The third prank of respondent's complaint pertains to the applicability of clause (d) of item no.1 of Schedule IV. The said clause can be attracted only if it is shown that the impugned termination was for patently false reasons. It is difficult to appreciate how the Division Bench persuaded itself to hold that the said clause was attracted on the facts of the present case. The appellant had a genuine reason for terminating the services of the respondent as hand composition department had become redundant on account of the introduction of the machine in question. It is true, as submitted by learned counsel for the respondent, that the impugned retrenchment order dated 22.6.1982 showed that the management, as per notice under Section 9-A, had noted that it may require to reduce 25 workmen from service for the purpose of introducing new technology. It is also true that the new technology was already introduced by the management months prior to the day of the termination order dated 22nd June, 1982, to be precise from January, 1981 on an experimental basis as submitted by learned counsel for the appellant and on regular basis at least from November, 1981. Still it cannot be held that the proposed termination was not based on real reason or was effected on patently false reasons. If no such machine was ever introduced and still such a ground was made out for passing the impugned order, then it could have been said that the impugned termination was passed on patently false reasons. The patently false reason would be one which has no existence at all in fact and is a mere pretext or an excuse. Such is not the situation in the present case. It may be that the reason given may not be strictly accurate in the sense machine was already introduced and was not likely to be introduced by the time notice under Section 9-A was given followed by the impugned termination order. That may have effect of non-compliance of the provisions of Section 9-A. The said notice, as we have seen earlier, on that score may become inoperative or illegal. Still the reason for termination cannot be said to be patently false. We, therefore, disagree with the conclusion of the Division Bench of the High Court in view of our aforesaid findings regarding non-applicability of clauses (a), (b) & (d) of item 1 of Schedule IV. On this conclusion, we would have been required to dismiss the respondent's complaint but for the fact that the fourth leg of the respondent's complaint invoking clause (f) second part of item no.1 cannot be said to be non-existent or unjustified or uncalled for. As we have already discussed, order of discharge whether punitive or non-punitive if found to be the result of undue haste on the part of the employer, the inevitable result will be that the employer would be guilty of `unfair labour practice' as laid down by Schedule IV item no.1 clause (f) second part. In the facts of the present case, the decision rendered by the Division Bench of the High Court on this score cannot be found fault with. It has to be recalled that the proceedings in connection with notice under Section 9-A were pending in conciliation. Efforts were made by the Conciliation Officer for seeing that the parties come to an amicable settlement. Of course, those efforts failed and on 22nd June, 1982 by 4.35 p.m. the Conciliation Officer orally declared that the conciliation had failed and investigation was at an end. However, as seen earlier, that was not the end of the matter. The Conciliation Officer did not become functus officio on that day. As per Section 12 sub-section (4) of the I.D. Act thereafter he had to give a full report setting forth the steps taken by him for ascertaining the facts and circumstances relating to the dispute and for bringing about a settlement thereof, together with a full statement of such facts and circumstances, and the reasons on account of which, in his opinion, a settlement could not be arrived at. That obviously would have taken a few days, if not more, before such report could have been prepared by the Conciliation Officer. It is, therefore, difficult to appreciate how the appellant in hot hurry and within almost half an hour from the close of investigation on the very same day by 5'O clock in the evening could pass the impugned termination order against the respondent. It has to be appreciated that in the report which was to follow, the Conciliation Officer was required to highlight the nature of the dispute between the parties in the light of the notice under Section 9-A given by the appellant to the respondent union. It is easy to visualise that even in such a failure report the conciliator could have given his prima-facie opinion regarding the nature of the dispute and the reasonableness thereof. It is also to be kept in mind that once such report reaches the State Government, in the light of the report if the State Government finds that the dispute is a genuine dispute which requires adjudication, it may make an order of reference or if, on the other hand, the State Government finds from the report that the dispute is frivolous it may not make a reference but that stage could reach only after the report is received and scrutinised by the State Government. Under these circumstances, for passing the impugned retrenchment order within half an hour of the close of investigation by the Conciliation Officer, the appellant could not have presumed that the report would necessarily indicate total frivolousness of the dispute and that would not persuade the State to make a reference of the dispute for adjudication by a competent Court. Without waiting to see as to what will be the nature of the report and the contents, the appellant tried to help itself and in undue hurry passed the impugned order. The result was that by one stroke the appellant pre-empted the report of the conciliator on the one hand and on the other hand even the future objective action of the State Government on such a report. It is also important to note that on the report of the conciliator, the State Government could have thought it fit to refer the dispute for adjudication and in the present case on the basis of the said report, reference was in fact made by the State Government regarding the legality of the scheme of rationalisation resulting in the likelihood of retrenchment of the workmen concerned. The said reference became infructuous only because the appellant, in the meantime, invoked jurisdiction of the Labour Court under Section 28 of the Maharashtra Act. That resulted in the applicability of Section 59 of the Maharashtra Act which lays down as under : "If any proceeding in respect of any matter falling within the purview of this Act is instituted under this Act, then no proceeding shall at any time be entertained by any authority in respect of that matter under the Central Act or, as the case may be, the Bombay Act; and if any proceeding in respect of any matter within the purview of this Act is instituted under the Central Act, or, as the case may be, the Bombay Act, then no proceeding shall at any time be entertained by the Industrial or Labour Court under this Act."

It is because of the aforesaid provision of Section 59 of the Maharashtra Act that the referred dispute under Section 10 of the I.D. Act got disposed of. However, the fact remains that on the failure report submitted by the Conciliation Officer the appropriate Government had thought it fit to prima facie hold that the dispute was a real one which required adjudication by the competent Court under the I.D. Act. It is also necessary to note that in such references received by the competent Court under the I.D. Act in appropriate cases, the Court to which such references are made has ample jurisdiction to pass interim orders and if the Court had found that the impugned retrenchment order was required to be stayed even though it had been passed after conciliation proceedings were over and when there was no prohibitory order from any authority such retrenchment order could have been stayed. Further implementation of the impugned change could have been stayed vide The Management Hotel Imperial, New Delhi and others vs. Hotel Workers' Union (AIR 1959 SC 1342) and The Hind Cycles Ltd. and another vs. The Workmen (AIR 1974 SC 588).

It is also to be noted that in the facts of the present case, as already held by us on point no.1, the conciliation proceedings had not terminated when the impugned order was passed. The result was that Section 33(1) got violated and the appellant became liable to be punished as per Section 31(1) of the I.D. Act incurring a penalty for being convicted of an offence punishable with imprisonment for a term which may extend to 6 months or with fine or with both. Thus the impugned order cannot, but be held to have been passed with undue haste. The intention behind passing such a hurried order was obviously to cut across and pre-empt the submission of failure report by the conciliator on the one hand and its consideration by the State on the other and even for avoiding the future possibility of a reference under the I.D. Act and also the future possibility of the Court's intervention by way of interim relief against such order. But to crown it all by such undue hurry the appellant made itself liable to be punished and incurred a criminal liability for the same. All these consequences unequivocally project only one picture that the impugned order was passed in a great hurry and with undue haste. This conclusion is inevitable on the aforesaid facts which have remained well established on the record of the present case. Consequently, agreeing with the view of the Division Bench in the impugned judgment it must be held that the respondent's complaint was well sustained at least under clause (f) second part of item 1 of Schedule IV and as the impugned order was passed with undue haste the inevitable result is that by the said act the appellant is liable to be treated as guilty of `unfair labour practice'.

We may also mention in this connection one another facet of this question. As the Conciliation Officer, after hearing the parties, had declared that investigation was over and settlement had not taken place, at least a few days were available after 22nd June, 1982 to the appellant for moving the Conciliation Officer to give the appellant permission to retrench the respondent. It is not possible to agree with the finding of the Labour Court that the Conciliation Officer could not have entertained such a request. He had not even drafted his report, much less submitted the same to the State Government at least within a few days after 22nd June, 1982. The very fact that the report reached the State Government on 13th August, 1982 shows that the conciliator would have despatched the same at least a couple of days after 22nd June, 1982, having complied with all the statutory requirements under Section 12(6) for preparation of such a report. Even on the next day of 22nd June, 1982 such a request could have been made by the appellant and the conciliator would not have felt any inhibition in recalling both the parties and hearing them on such a request on the part of the appellant to give permission to it to pass the impugned termination order as the conciliation had failed. Even by passing such a legally permissible and factually feasible course, and without waiting even for more than half an hour the impugned order was passed. It is easy to visualise that it was possible that if such a request was made by the appellant it could have been granted or it could have been rejected. If such a request was rejected by the conciliator then, of course, the impugned order could not have seen the light of the day and if thereafter the State Government had made the reference after reading the failure report, then the existing position regarding service condition of the respondent could have been continued by the reference Court pending the adjudication of such a dispute. The appellant with a view to avoid all these uncomfortable situations indulged in self help and passed the impugned order on the very evening of 22nd June, 1982. This is an additional facet of the deliberate undue haste resorted to by the appellant for short circuiting all possible inconvenient situations and to present the respondent with a fait accompli and also to placate the Conciliation Officer on the one hand and the State Government on the other and ultimately the reference Court also. Consequently it must be held that the impugned order was clearly a result of undue haste and, obviously amounted to `unfair labour practice' on the part of the appellant as per Schedule IV item 1 clause (f) second part. Consequently, this point for determination is held against the appellant and in favour of the respondent only to the extent of applicability of the aforesaid provision.

Point No.5: So far as this point is concerned, we have already noted that the Labour Court itself has found that notice under Section 9-A was a belated one and should have been given at least by November, 1981 when the machine in question became fully operative resulting in displacement of workers in hand composing department. Still by curious reasoning, it has been held that there was nothing wrong with the notice though given belatedly and that the termination order was also not offending Section 33(1) of the Act. These findings show patent errors of law and could not be sustained. The Industrial Court, on the other hand, came to an equally erroneous finding on the applicability of item 10 of Schedule IV of the I.D. Act when it held that the said item would apply not at the time when the rationalisation scheme was introduced, but at the time when the employer desired or decided to terminate the services of the employees. This reasoning of the Industrial Court is contrary to the very scheme of item 10 of Schedule IV of I.D. Act and totally ignores the term `likely to lead to retrenchment' as found in the said item. The reasoning of the Industrial Court almost amounts to rewriting the said phrase as "decide to retrench the workmen". These patent errors of law committed by the Labour Court and the Industrial Court were totally bypassed by the learned Single Judge while he dismissed the Writ Petition. These patent errors of law, therefore, were rightly set aside by the Division Bench of the High Court in the Letters Patent Appeal. It could not, therefore, be said that the impugned judgment had tried to interfere with the pure findings of the fact reached by the authorities below on evidence against the respondent. It was perfectly open to the Appellate Court in the hierarchy of proceedings to interfere with such patent errors of law and to correct them, otherwise it could have been said that it had failed to discharge its duty and that would have also amounted to failure to exercise jurisdiction on its part. The aforesaid point is, therefore, answered in affirmative against the appellant and in favour of the respondent by holding that the Appellate Court had corrected patent errors of law and had not interfered with the pure findings of the facts not connected with the relevant questions of law with which they were intertwined.

Point No.6: Now is the time for us to take stock of the situation in view of our aforesaid findings on the relevant points for determination. The final order passed by the High Court in the impugned judgment has to be sustained. However, one aspect of the matter cannot be lost sight of while closing the present chapter. The respondent's services were terminated on 22nd June, 1982 and that the termination is found to be amounting to `unfair labour practice' as per the provisions of Section 30 of the Maharashtra Act. On this conclusion, the appellant has to be asked to withdraw such `unfair labour practice', meaning thereby, the impugned order has to be set aside and, thereafter, affirmative action including reinstatement of the employee with or without back-wages could be ordered by the Labour Court in these proceedings. However, as the High Court has noted that reinstatement is out of question as respondent has reached the age of superannuation, in the meantime, with effect from 3.5.1995, therefore, at the highest the respondent is entitled to back-wages for 13 years with gratuity and other retirement benefits. That is precisely what is ordered by the High Court in the impugned judgement. However, learned counsel for the appellant is right when he contends that even before the conciliator the respondent's union on behalf of its members including the present respondent who were all facing retrenchment suggested that they were prepared to accept compensation @ 4 months wages per every completed year of service with a view to settle the dispute. This suggestion on behalf of the workmen by their union is noted by the conciliation officer in his report which reached the State Government on 13th August, 1982. It may be seen that by that time the impugned retrenchment order was only two months old as it was passed on 22nd June, 1982. It is also noted by the conciliation officer that this proposal did not find favour with the management. If it had been accepted by the management at that time the respondent-workman would have been satisfied by way of compensation amounting to only one third of the back- wages for each year of service. It is, of course, true that years rolled by thereafter and the compromise did not go through. It is also true that the value of money in 1982 was much higher than what it is today. It is also true that the respondent has been denied not only back-wages but also interest on the said amount which would have been available to him years back. However, one aspect of the matter cannot be lost sight of. There is nothing on record to show that the respondent was gainfully employed or was not employed in any alternative avocation during all these years. It is, of course, true that it was for the appellant to point out as to how grant of back-wages should be reduced on account of the gainful employment of the respondent, in the meantime. Such an effort was not made by the appellant.

However, still one fact which stares in the face of the respondent is well established that the appellant has tried his best to accommodate the respondent in alternative employment at Jalgaon where hand composing department was working. If the respondent accepted the said offer he would have earned his full wages all throughout till retirement. Thus in a way the respondent also was responsible for the unfortunate situation in which he found himself during all these years. It is also to be noted that the complaint filed as early as on 25th June, 1982 remained dismissed in the hierarchy of proceedings from the Labour Court onwards up to the learned Single Judge's decision in the High Court and it is only in the Letters Patent Appeal that he ultimately succeeded. Considering all these aspects, in our view, interest of the justice will be served if, while confirming the final order of the High Court impugned in this appeal, a modification is made regarding back-wages payable to the respondent. This is required also in view of the further fact that we disagree with the conclusion of the Division Bench of the High Court that the appellant was guilty of `unfair labour practice' under item Nos.1(a), (b) and (d) of Schedule IV of the Maharashtra Act and the decision of the High Court is being confirmed regarding `unfair labour practice' of the appellant only under item 1(f) second part of Schedule IV of the said Act. While considering the grant of appropriate back-wages, we deem it fit to adopt the same yardstick which was suggested by the respondent-workman's union for all its members including the respondent that one third of back wages for each completed year of service would be acceptable to them. We, accordingly, deem it fit to modify the final order of the High Court to the following extent : The appeal of the respondent before the High Court will be treated to be allowed by holding that the appellant management had indulged in `unfair labour practice' only under item 1(f) second part of Schedule IV of the Maharashtra Act with the consequential direction that the appellant was not to indulge into and shall desist from indulging into such unfair labour practice.

The second modification in the impugned judgment of the High Court will be to the extent that the appellant shall pay to the respondent-workman 1/3rd (i.e. 33% approx.) of back-wages with all other consequential benefits from 22nd June, 1982 till the date of his superannuation i.e. 3rd May, 1995. The said amount shall be paid by the appellant to the respondent within a period of 3 months from the date of this judgment and in case of failure to pay the said amount within that time the appellant shall be liable to pay the said amount with running interest of 12% on the expiry of 3 months from today till the date of actual payment. Subject to the aforesaid modifications in the judgment and final order of the High Court impugned in this appeal, the appeal stands dismissed.

In the facts and circumstances of the case, there will be no order as to costs.