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PETITIONER: AGRA ELECTRIC SUPPLY CO. LTD.

       Vs.

RESPONDENT: SRI ALLADIN & ORS.

DATE OF JUDGMENT: 12/08/1969

BENCH: BHARGAVA, VISHISHTHA BENCH: BHARGAVA, VISHISHTHA VAIDYIALINGAM, C.A.

CITATION:  1970 AIR  512            1970 SCR  (1) 808  1969 SCC  (2) 598  CITATOR INFO :  R          1972 SC1201  (8,10,14)  F          1972 SC1626  (8)  F          1972 SC2326  (13,14,15,26)  R          1973 SC2650  (6)  RF         1977 SC2257  (3)  R          1984 SC1064  (12)

ACT:     Industrial  Employment  (Standing  Orders)  Act  (20  of 1946)-Standing    Orders   certified   under    Act--Whether applicable to workmen employed before such certification.    Termination  of  service  during  probation--Real   basis misconduct-Order  worded  as  simple  termination--Power  of Labour Court to go behind and ascertain real basis.

HEADNOTE: Prior  to 1951 there were no rules or conditions of  service prescribing  the  age of superannuation  in  the  appellant- Company.  In 1951, its Standing Orders were certified  under the Industrial  Employment  (Standing Orders) Act, 1946, and were brought into force. Standing Order 32 provided 55 years as  the age of superannuation.  The first three  respondents were workmen employed in the Company in 1929, 1935 and 1937. Relying  on Standing Order 32 the Company served notices  on these  3 workmen who had attained the ages of 58, 64 and  59 on  the dates of the ’respective notices, and retired  them. The  Labour  Court, to which the dispute arising  from  such retirement  was  referred,  held that  the  Standing  Orders having been certified long after these workmen were employed and  the conditions of their employment not having  provided any  age of retirement.the Company could not apply  Standing Order  32  to  them, that the orders of  retirement  on  the ground  of superannuation were bad and gave  conse  quential directions.      The  Company  appointed the 4th respondent  in  December 1965 as a cleaner.  The letter of appointment stated that he was to be a probationer for 6 months with discretion to  the concerned  officer  to extend the period.  The  letter  also stated  that during the probationary period his service  was liable  to.  termination  without  any  notice  and  without assigning any reasons therefore.  His service was terminated

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in  February   1966.  Before the Labour Court  evidence  was led  on behalf of the Management that workman’s service  was terminated    because   his   work   as   probationer    was unsatisfactory.   The  Labour Court found  on  the  evidence before  it  that the real reason for  passing  the  impugned order of termination was not the alleged unsatisfactory work but his having unauthorisedly used a motorcycle belonging to an engineer of the Company and caused damage to it. In  that view, the Labour Court held that  the exercise of the  power to  terminate was not bona fide and consequently  set  aside that order also. In appeal to this Court,     HELD: (1)(a) The Act provides that every employer of  an indusTrial  establishment  must  have  his  Standing  Orders certified,  that the Standing Orders should be submitted  to the certifying  authority along  with particulars of all the workmen  then  employed as  also the name of  the  union  if any,  to which they belong, That the  certifying   authority should give notice to the union, and in its absence, to  the workmen  to make Their objections and an opportunity to  the employer  and the representatives of The workmen  for  being heard, that the authority should thereafter adjudicate  upon the  fairness  and  reasonableness of  the  Standing  Orders submit- 809 ted,  that the authority should certify the Standing  Orders with  modifications  or additions if any,  that  any  person aggrieved by such certification may appeal to the  appellate authority,  that  the Standing Orders as  finally  certified come  into operation on a particular day, that the  employer should  publish them on notice boards in such a manner  that they become easily known to the workmen, and that, after the expiry  of  6  months from the date on  which  the  Standing orders   or  the last modification   came   into  operation, either the employer or any of the workmen could apply for  a modification.    These  provisions   show   that  once   the Standing  Orders  as  certified come  into  operation,  they ’become  binding on the employer as well as all the  workmen presently  employed  and those employed  thereafter  in  the establishment,  as  uniform conditions of  service.  If  the Standing Orders were to bind only those who are subsequently employed, the result would be that there  would be different conditions  of employment for different classes of  workmen, depending   on whether the workmen were employed  before  or after  the  certification  of  the  Standing  Orders  or   a modification  of such Standing Orders, and would render  the principle  of  collective bargaining  ineffective.   Such  a result would render the conditions of service of workmen  as indefinite  and diversified as before the enactment  of  the statute  though it was to do away with such  diversity  that the Act was passed. [812 D-H; 813 A-D; 814 A-E]     Salem  Erode Electricity Distribution Co. Ltd. v.  Salem Erode Electricity  Distribution Co.  Ltd.  Employees  Union, [1966] 2  S.C.R.  498, follOwed.     Guest, Keen, Williams Pvt.  Ltd. v.P.J. Sterling, [1960] 1 S.C.R. 348, explained.     (b) The decision of the same Labour Court in Ref. No. 91 of  1964  between the appellant-Company  and  its   workmen, wherein  it was held that the very same Standing Orders  did not  apply  to workmen employed prior to their  coming  into force,  did  not prevent  the Company from  reagitating  the same question, because: [816 F]     (i)  The  rule  that  an award  binds  all  the  workmen employed  in an establishment and even future  entrants   is not  based on the principle of res judicata but. is  rounded

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on the condition for raising an industrial disputed. [817 A- B]     The  Newspapers L.td. v. The State Industrial  Tribunal, U.P.  [1957] S.C.R. 754, 761, Workmen v. Balmer Lawrie & Co. [1964] 5 S.C.R. 344 and Shahdara  (Delhi)  Saharanpur  Light Rly.  Co. Ltd. v. Shahdara Saharanpur Railway Workers’ Union [1969] 1 L.L.J. 734, referred to.     (ii)  The  award  in Ref. 91 of 1964 was  based  on  the supposition  that  the Guest, Keen, Williams  case,  decided that  Standing  Orders  were not binding on those  who  were employed  prior to the certification and their  coming  into force.   But  the Salem Erode Electricity  Distribution  Co. Ltd.  cage  has explained that case and shown  that  such  a supposition  was not correct.  Since the very basis  of  the award  in  Ref. 91 was wrong the  distinction  made  therein between  those   who  were previously  appointed  and  those appointed subsequently is also wrong. [817 E-H] (iii)  Further, the consequence of holding that the  Company was barred by principles analogous to res judicata would  be that  there would be two sets of conditions of service,  one for  those  previously  employed and the   other  for  those employed  after  the  Standing  Orders  were  certified,   a consequence  wholly incompatible with the object and  policy of the Act. [817 D-E] 810     (2)  It  is.  a  well-settled  principle  of  industrial adjudication that even if an impugned order is worded in the language  of  a simple termination  of  service,  industrial tribunals  can look into the facts and circumstances of  the case to ascertain if it was passed in colourable exercise of the  power of the management to terminate the service of  an employee  and find out whether it was in fact passed with  a view  to  punish him.  In the present case,  the  letter  of appointment  states  that  the workman was  appointed  as  a probationer  for a period of 6. months with power to  extend the period of probation.  Standing Order 2(c) also  provides that  the normal period of probation shall be 6 months  with discretion  to  extend  the period, the  maximum  period  of probation being 12 months. That means that at tie end of the period of probation the Company would have to decide whether to  confirm  him  or  terminate his  service  and  that  the probationer’s  service  cannot  be  terminated  during   the probation period except  for some misconduct.  The statement in   the  letter  that  workman’s  service  was  liable   to termination  even during the probationary period only  meant that  the appointment was subject to the Management’s  power of termination  as provided in the Standing Orders.  Such  a power is provided in Standing Order 14, but the  termination of  the   workman  was not for any of the  grounds  set  out therein.  Therefore, the termination  during  probation  was not  in conformity with the  power to  terminate under   the Standing Orders. [819 A-F]     Further,  the  finding of the Labour  Court  is  one  of fact  and  meant that it rejected the evidence  led  by  the Management   that  the  work  of  the  workman   was   found unsatisfactory.   Since the finding is not perverse  and  is based on evidence, it means the termination  was punitive in nature.  Such an order could be passed only after  a  proper inquiry.  Therefore, order of the Labour Court setting aside the termination was right. [819 G-H]

JUDGMENT:  CIVIL  APPELLATE  JURISDICTION: Civil Appeal  No.  2483  of

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1968.     Appeal  by special leave from the Award dated  July  24, 1968 o,f the Labour Court, Meerut in Case No. 92 of 1966.     S.V.  Gupte,  D.N.  Mukherjee  and  M.L.  Car,  for  the appellant.     Mohan  Kumaramangalam,  M.K. Ramamurthi,  Vineet  Kumar, Shyamala  Pappu and J. Ramamurthy, for the respondents.  The Judgment of the Court was delivered by Shelat, J.  In this appeal, by special leave, two  questions arise:  (1)  whether standing orders  govern  the  employees appointed  before they ,are certified under  the  Industrial Employment  (Standing  Orders)  Act, 20  of  1946,  and  (2) whether the appellant-company was entitled to terminate  the service  of a workman appointed as a probationer before  the expiry  of the period of probation except on the  ground  of misconduct.     The   first question relates to 3 workmen, Alladin,  Ram Prasad and Noorul Zaman, who were employed in 1929, 1935 and 1937 respectively, long before the company’s standing orders were certified and brought into force in  1951 and who  were superannuated 811 under standing order 32 of the said standing orders.   Prior to  1951  there  were  no rules  or  conditions  of  service prescribing  the age of superannuation.  Standing  order  32 for  the  first  time  laid down 55  years  as  the  age  of superannuation.   Relying on standing order 32  the  company served on the three workmen notices dated December 19, 1964, November  20,  1963 and January 27, 1964, who  had  by  then attained  the  age  of 58, 64 and 59  years,  by  which  the company  retired  them  with effect from  January  1,  1965, December 29, 1963 and March 1, 1964 respectively. The Labour Court,  to  which the dispute arising  from  the  compulsory retirement  was referred, held that the  company’s  standing orders  having been certified long after these workmen  were employed  and the conditions of their employment not  having provided any age of retirement, the company could not  apply standing  order  32 to them, and therefore,  the  orders  of superannuation  were bad, and directed  their  reinstatement and  payment  to.  them  of their wages  from  the  date  of retirement till the date when they would be reinstated.     Thus,  the question involved in this appeal  is  whether the  company  could retire ’by applying  standing  order  32 these three workmen, who admittedly had long passed the  age of  superannuation  provided thereunder.   Counsel  for  the company  argued that once the standing orders are  certified and  come  into  operation, they  would,  subject  to  their modification  as provided under the Act, bind  all  workmen, irrespective of whether they  were  employed before or after they came into force’, and that therefore, the Labour  Court was  in error in holding to the contrary and ordering  their reinstatement.   Mr.  Kumaramangalam,  on  the  other  hand, argued ( 1 ) that the company’s action amounted to  applying standing  order 32 retrospectively, that was not  warranted, for, if the standing orders were intended to be so  applied, they  would  have so expressly provided, and (2) that  in  a previous  reference,  being  Ref. 91 of  1964,  between  the appellant-company  and its workmen, this very  Labour  Court had  decided  that these standing orders did  not  apply  to workmen previously employed, that an appeal was sought to be filed in this Court against that order but no special  leave was  granted,  and  therefore,  that  order  became   final. Consequently, the company was not entitled to reagitate  the same  question,  as  it  was  precluded  from  doing  so  by principles  analogous  to  the principle of res judicata.

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   The   question  as  to  whether  standing  orders   were retrospective in their application can obviously arise  only if  they  do not in law bind  workmen  previously  employed. Such  a question can hardly arise if the provisions  of  the Act show, as contended by counsel for the Company, that once they  are certified and come into force, they bind both  the employer  and  all  the workmen presently employed. 812 As    observed   in   Shahdara   (Delhi)-Saharanpur    Light Railway Company Ltd. v. Shahdara-Saharanpur Railway Workers’ Union(1)  the Act is a beneficent piece of legislation,  its object being to require, as its preamble and its long  title lay down, employers industrial establishments to define with sufficient   precision   the  conditions  of  employment  of workmen  employed under them and to make them known to  such workmen.   Before the passing of the Act, there was  nothing in law to prevent  an  employer  having different  contracts of  employment with workmen employed by him  with  different and varying conditions of service.  Such a state of  affairs led   to   confusion  and   made   possible   discriminatory treatment  between employees ,and employees though  all   of them   were appointed in the same premises and for the  same or  similar  work. Such a position is  clearly  incompatible with  the  principles of collective bargaining  and  renders their  effectiveness  difficult, it not impossible.   To  do away with such diversity and bargaining with each individual workman,  the legislature provided by s. 3 of the  Act  that every employer of an industrial establishment must, within 6 months  from the date of the Act becoming applicable to  his industrial establishment, submit to the certifying authority under  the  Act draft standing orders prepared  by  him  for adoption  in his industrial establishment providing  therein for  *all  matters set out in the Schedule to the  Act,  and where  model  standing orders are prescribed  to  have  such draft  standing orders in conformity with them.   The  draft standing  orders  are to be accompanied  by  particulars  of workmen  employed in the establishment as also the  name  of the union, if any, to which they belong.   This  requirement clearly  means particulars of the workmen in  employment  at the date of the submission of the draft standing orders  for certification  and not those only who would be  employed  in future  after certification.  Under s. 4, such draft  orders ’are certifiable if they provide for all matters set out  in the  Schedule, are otherwise in conformity with the Act  and are  adjudicated  as fair and reasonable by  the  certifying officer or the appellate authority.  Section 5 requires  the certifying  officer to forward a copy of the draft  standing orders  to  the union or in its absence to  workmen  in  the prescribed manner with a notice requiring objection, if any, from the workmen. After giving the employer and the union or the workmen’s representatives an opportunity of being heard, the  certifying  officer has to decide whether  or  not  any modification  or  addition  to the draft  submitted  by  the employer  is necessary and then certify the  draft  standing orders  ’and  send copies thereof and of his order  in  that behalf to the employer, the union or the representatives  of the  workmen. Section 6 confers the right of appeal  to  any person  aggrieved by such order to the appellate  authority, who, by his order, can. either confirm or amend the standing orders.  Under s. 7, such standing (1) [1969] 1 L.L.j. 734. 813 orders  are to come into operation on the expiry of 30  days from  the date on which their authenticated copies are  sent by  the  certifying officer to the parties where  no  appeal

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against these orders is filed or where such appeal is  filed on  expiry  of 7 days from the date on which copies  of  the appellate authority’s order are sent as required by s. 6(2). Section 9 requires the employer to post the standing  orders ’as finally certified on boards maintained for that  purpose at  or  near the entrance through which  the   majority   of workmen  inter  the  industrial establishment  and  in’  all departments  thereof.   Section 10 confers the right  to  an employer  or  any of the workmen to apply  for  modification after expiry of 6 months from the date on which they of  the last  modification  thereof  came  into    operation.    The Schedule  to  the Act sets out matters  which  the  standing orders must provide for.  These matters are classification of  workmen,  shift  working, periods  and  hours  of  work, holidays, pay days, wage rates, conditions and procedure for applying  for  grant  of leave,  closing  and  reopening  of sections   of   the  industrial   establishment,   temporary stoppage:  of work, liabilities and rights of  the  employer and   the   workmen  arising   therefrom,   termination   of employment, disciplinary action, penalties etc.       The  obligation  imposed  on the  employer   to   have standing  orders  certified,  the  duty  of  the  certifying authority   to   adjudicate   upon   their   fairness    and reasonableness,  the notice to be given to the union and  in its absence to the representatives of the workmen, the right conferred on them to raise objections, the opportunity given to them of being heard before they are certified, the  fight of appeal and the right to apply for modifications given  to workmen individually, the obligation on the employer to have them  published  in such a manner that  they  become  easily known  to the workmen, all these provisions abundantly  show that  once the standing orders are certified and  come  into operation, they become binding  on  the employer and all the workmen presently employed as also those employed thereafter in the establishment conducted by that employer.  It  cannot possibly be that such standing orders would bind only  those who  are employed after they come into force and  not  those who  were  employed previously but are still  in  employment when  they come into force.  The right of being heard  given to  the  union  or,  where  there  is  no.  union,  to   the representatives of the workmen, the right of appeal and  the right   to   apply  for  modification   given   to   workmen individually  clearly indicate that they were  provided  for because   the   standing  orders,  as  they   emerge   after certification, are intended to be binding on all workmen  in the  employment of the establishment at the date  when  they come into force and those employed thereafter.  Surely,  the union  or, in its absence, the representatives  of  workmen, who  are given the right to raise objections either  to  the draft  standing  orders proposed by the employer or  to  the fairness and reasonableness of their provi 814 sions, could not have been intended to speak for workmen  to be  employed  thereafter and not those whom  they  presently represent. Besides, if the standing orders were to bind only those  who  are subsequently employed, the result  would  be that there would  be different conditions of employment  for different  classes  of workmen, one set  of  conditions  for those  who  are previously employed and  another  for  those employed  subsequently,  and where they are  modified,  even several sets of conditions of service depending upon whether a  workman  was  employed before  the  standing  orders  are certified or after, whether he was employed before or  after a  modification  is made to any one of them and  would  bind only a few who are recruited after and not the bulk of them,

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who though in employment were recruited previously.  Such  a result  could never have been intended by  the  legislature, for, that would render the conditions of service of  workmen as  indefinite and diversities, as before the enactment  o,f the Act.  Why does s. 3 (3) of the Act require the  employer to  give particulars of the workmen employed by him  at  the date  of his submission of the draft standing orders  unless the object of making him furnish the particulars was to have uniformity of conditions of service and to make the standing orders binding on all those presently employed.  That is why the Act also insists among other things that after they  are certified they must be made known to all workmen by  posting them at or near the entrance through which they pass and  in the language known to the majority o,f them.     In Guest, Keen, Williams Pvt. Ltd. v.P.J. Sterling(1)  a view  apparent contrary to the one above stated was said  to have  been taken since it was held there that it was  unfair in that particular case to fix the age of superannuation  of previous  employees  by a subsequent standing  order,  which should  apply  in that matter to future entrants.   In  that view  the Court fixed 60 years as the age of retirement  for such  previous  employees although the  standing  order  had provided 55 years as the age of superannuation. Salem  Erode Electricity  Distribution  Company  Ltd.   v.   Salem  Erode Electricity  Distribution Co. Ltd. Employees  Union(2)  this Court,  however,  took the same view which  we  have  stated above  and  held  that the provisions of  the  Act   clearly indicated  that matters specified in the Schedule to the Act should  be covered by uniform standing orders applicable  to all workmen employed in an industrial establishment and  not merely to entrants employed after their certification.   The question  arose out of an application made by  the  employer for   modification  of  the  existing  standing  orders   by providing different rules relating to holidays and leave for employees   appointed  before  a  certain  date  and   those appointed after that date.  Negativing such a  modification, the Court, after examining (1) [1960] 1 S.C.R. 348.            (2) [1966] 2 S.C.R. 498. 815 the relevant provisions of the Act, stated at pages 504  and 505 as follows:                     "One  has’  merely  to.  examine   these               clauses one by one to be satisfied that  there               is  no scope for having two separate  Standing               Orders in respect to any one of them. Take the               case  of  classification of  workmen.   It  is               inconceivable  that there can be two  separate               Standing  Orders  in respect of  this  matter.               What  we  have said  about  classification  is               equally true ,about each one of the other said               clauses; and so, the conclusion appears to  be               irresistible that the object of the Act is to,               certify  Standing  Orders in  respect  of  the               matters  covered by the Schedule;  and  having               regard to  these  matters,  Standing Orders so               certified would be uniform and would ,apply to               all  workmen  alike who are  employed  in  any               industrial establishment.                      On  principle, it seems  expedient  and               desirable   that  matters  specified  in   the               Schedule  to  the  Act should  be  covered  by               uniform  Standing  Orders  applicable  to  all               workmen    employed    in    an     industrial               establishment.  It is not difficult to imagine               how  the application of two sets  of  Standing

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             Orders in respect of the said matters is bound               to  lead  to confusion in the working  of  the               establishment   and   cause    dissatisfaction               amongst  the  employees.  If Mr.  Setalvad  is               right  in contending that the Standing  Orders               in relation to these matters  can  be  changed               from  time  to  time,  it  may  lead  to   the               anomalous  result that in course of 10  or  15               years  there  may come into existence 3  or  4               different  sets of Standing Orders  applicable               to  the  employees  in  the  same   industrial               establishment, the application of the Standing               Orders  depending upon the date of  employment               of the respective employees.  That, we  think,               is not intended by the provisions of the Act." At page 509 to 510 the Court referred to. the case of Guest, Keen, Williams Private Ltd. (1), relied on by the employers’ counsel,  and explained why the Court had fixed 60 years  as the  age  of  superannuation ,for  the  employees  appointed before  the  standing  orders were  certified  although  the standing   orders  had  fixed  55  years  as  the.  age   of superannuation stating that: "that  course  was  adopted under the  special  and  unusual circumstances   expressly  stated  in  the  course  of   the judgment."     (1) [1960] 1 S.C.R. 348. LISSupCI/69--8 816 This  decision thus confirms the view taken by us  that  the object  of  the  Act  is to  have  uniform  standing  orders providing for the matters enumerated in the Schedule to. the Act, that it was not intended that there should be different conditions of service for those who are employed before  and those  employed after the standing orders come  into  force, and finally, that once the standing orders come into  force, they  bind  all  those presently in the  employment  of  the concerned  establishment  as well those  who  are  appointed thereafter.     Counsel for the workmen, however, drew our attention to. the  award  in  Ref. 91 of 1964 under s. 4(k)  of  the  U.P. Industrial  Disputes Act, 1947.  That reference,  no  doubt, was  between the appellant-company and its workmen  and  the question decided there was whether the company was right  in compulsorily retiring the six workmen there concerned  under these  very  standing orders although  they  were  employed. before  they were certified and came into force. The  Labour Court, relying on Workmen of Kettlewell Bullen & Co. Ltd. v. Kettlewell Bullen & Co. Ltd.(1) which in turn had relied  on Guest, Keen, Williams’ case(2), held that Standing Order  32 of  these  Standing  Orders could not be  applied  to  those previously  appointed  and that,  therefore,  the  company’s action  in retiring those workmen was. not justified.     We  may  mention that the case of  Kettlewell  Bullen  & Co.(1) -was not one concerned with Standing Orders but  with rules  made  by the company and this Court, relying  on  the decision in Guest, Keen, Williams Private Ltd. (2) held that where the rules of retirement are framed by the company they would  have no application    of its prior employees  unless such employees have accepted the new rules. It is clear that neither the case of Kettlewell Bullen & Co.(1) nor the  case of Guest, Keen, Williams Private Ltd.(2) in the fight of the explanation  given  in the case of Salem  Erode  Electricity Distribution  Ca.  Ltd.(a), was applicable  and  the  Labour Court  was, therefore, clearly in error in basing its  award on  the  decision  in the case of Kettlewell  Bullen  &  Co. (1).The  argument, however, was that even if that award  was

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erroneous,   the   company  did  not  appeal   against   it, consequently  it  became final and the issue  there  decided being  the  same and between the  same  parties,  principles analogous   to the principle  of  res judicata  would  apply and  therefore  no relief should be granted in  the  present case  to  the  company.   It is. true,  as  stated  in   The Newspapers  Ltd. v. The State Industrial  Tribunal,  U.P.(4) that  an  award bind’s not only the individualS  present  or represented  but all workmen employed in  the  establishment and  even future entrants. But that principle is rounded  on the essential condition for the (1) [1964] 2 L.L.J. 146,         (2) [1960] 1 S.C.R. 348. (3) [1966] 2 S.C.R. 98.          (4) [1957] S.C.R. 754, 761. 817 raising  of an industrial dispute itself.  If an  industrial dispute  can be raised only by a group of workmen acting  on their  own  or through their union, the conclusion  must  be that  all those who sponsored the dispute ,are concerned  in it  and  therefore bound by the decision  on  such  dispute. (see M/s. New India Motors (P) Ltd. v.K.T. Morris)(1).  Such a  consideration, however, is not the same as the  principle of res judicata or principles analogous to res judicata.  In Workmen   v.   Balmer Lawrie & Co.(2) no doubt,  a  case  of revision  of  wage scales,  this   Court  cautioned  against applying  technical considerations of res  judicata  thereby hampering  the discretion of industrial adjudication.   (see also  Shahdara (Delhi)-Saharanpur Light Railway Co. Ltd.  v. Shahdara   Saharanpur   Railway  Workers’   Union(a).    How inexpedient it is to apply such a principle. is evident from the fact that the ’award in Ref. 91 of 1964 was based on the decision  in Kettlewell Bullen & Co. Ltd. (4) which in  turn had  followed  the  case of Guest,  Keen,  Williams  Private Ltd.(5)  on the supposition (which, as aforesaid,  was  no.t correct)  that standing orders are not binding on those  who are  employed prior to their certification and their  coming into force.  The company, presumably, did not challenge  the correctness  of  that  award because  it  was  perhaps  then thought that was the law laid down in Guest, Keen,  Williams Private Ltd.(5). The consequence of holding that the company is  barred by principles analogous to res judicata would  be that  there would be two sets of conditions of service,  one for  those  previously  employed and  the  other  for  those employed  after  the  standing  orders  were  certified,   a consequence  wholly incompatible with the object and  policy of the Act.  The very basis of the award in Ref. 91 of 1964, namely,  the wrong understanding of the decision  in  Guest, Keen, Williams Private Ltd.(5), having gone, it becomes  all the  more  difficult  and  undesirable  to  perpetuate   the distinction  made therein between those who were  previously appointed and those appointed subsequently and to refuse  on such  an untenable distinction relief to the  company.   The award  in Ref. 91 of 1964 was made on May 24, 1965  when  it was believed that the decision in Guest, Keen, Williams  Co. Ltd.(5)  laid down the principle that standing orders  would not  bind workmen previously employed.  That was not so  was clarified   in   the  case  of   Salem   Erode   Electricity Distribution   Co.  Ltd.(6),  the  decision  in  which   was pronounced on November 3, 1965 removing thereby any possible misapprehension.   The  present reference was made  on  June 23,   1966,   tong  after  the  decision  in   Salem   Erode Electricity  Distribution Co. Ltd.(6) and the  Labour  Court gave  the  award impugned in this appeal on July  24,  1968. Thus,  both  the Reference  and  the award   were   made  in circumstances different from those which  (1) [1960] S.C.R. 350, 357.   (2) [1964] 5 S.C.R. 344.

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(3) [1969] 1 L.L.J. 734.      (4) [1964] 2 L.L.J. 146.  (5) [1960] 1 S.C.R. 348.    (6) [1966] 2 S.C.R. 498. 818 prevailed  when Ref. 91 of 1964 was made and disposed of,  a factor  making  it doubtful the application of  a  principle such as res judicata.     The  second  question relates to  the  workman,  Shameem Khan.   The  company  appointed  him  under  a   letter   of appointment dated December 2, 1965 to the post of a  cleaner as  a  probationer  for  6 months  with  discretion  to  the resident engineer to  extend  that period.  The letter  also stated that during his probationary period his service would be  liable  to termination without any  notice  and  without assigning  any  reason therefore and that he  would  not  be deemed  to have been confirmed automatically in the post  on the  expiry  of the probation period unless  so  advised  in writing.   The  workman  worked ,as  such  probationer  till February 28, 1966 when he was served with a memorandum  that his service was terminated as from the close of that day.The workman’s  case  was  that  the  company  had  no  right  to terminate  his  service before the expiry of  the  6  months period  of  probation  which is  the  period  prescribed  by standing  order 2(c), that the stipulation in the letter  of appointment  that  his  service was  liable  to  termination during  the probation period was contrary to. that  standing order,  and that therefore, that stipulation was not  valid, and  lastly, that the said order, though apparently  one  of termination  simpliciter, was not a bona fide order, was  in truth punitive m nature, and therefore, could not be  passed without  an opportunity of being heard having been given  to him  in a properly held enquiry.  The ,fact is that no  such enquiry was held and no opportunity was given to the workman to  explain any misconduct for which he could be removed  or dismissed.     The  evidence  before  the Labour  Court  was  that  the concerned  workman had unauthorisedly used  the  motor-cycle belonging  to one Sidhana, a shift engineer in  the  company and  that motorcycle met with an accident while the  workman was  using it causing damage to it.  Three days  after  that accident  a report alleging that his work as  a  probationer was  unsatisfactory  was made by his superior  officer.   On this  evidence the Tribunal came to the conclusion that  the impugned order was not an order of termination  simpliciter, that  though  couched in that language it was. passed  as  a punishment  or the workman having used that vehicle  without the  consent  of its owner and was, therefore, an  order  of dismissal.  The  Tribunal was also of the opinion  that  the said report alleging unsatisfactory work by the. workman was colourable and made at the instance of the shift engineer or at  any  rate was inspired by the s.aid incident.   In  this view  the  Labour Court held that the exercise of  power  to terminate  the service of the workman was not bona fide  and consequent  it  set  aside  that  order  and  directed   his reinstatement. 819     Now,  it  is  a well  settled  principle  of  industrial adjudication that even if an impugned order is worded in the language  of  a simple termination  of  service,  industrial tribunals can look into the facts and circumstances. of  the case  to ascertain if it’ was passed in colourable  exercise of  the power of the management to terminate the service  of an employee and find out whether it was in fact passed  with a  view to punish him.   The letter of  appointment  clearly states  that the workman, Shameem Khan, was appointed  as  a probationer  for  a  period of 6 months with  power  to  the

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resident  engineer  to  extend  the  period  of   probation. Ordinarily, that would mean that at the end of the probation period  the company would have to decide whether to  confirm him  to  a permanent post or, if that is  not  possible,  to terminate his service.  Standing order 2 (c) provides that a probationer is ’an employee who is provisionally employed to fill a permanent vacancy in a post and who has not completed the period of probation thereunder.  It also lays down  that the  normal  period of probation shall be 6 months  but  the resident engineer has the discretion to extend that  period, the  maximum  period of probation being 12  months  in  all. Ordinarily,  this  would mean that a  probationer’s  service cannot  be terminated except for some misconduct  until  the expiry   of    the   probation  period.    The   letter   of appointment,  no.  doubt,  contained a  provision  that  the service  of  the  workman was liable  to.  termination  even during  the probationary period.  That  provision,  however, must  be read to mean that the appointment was  subject   to the  management’s  power of termination as provided  in  the standing  orders.   Standing order 14 provides  for  such  a power  ’and  lays down that the service  of  "any  employee" (which  expression includes a probationer as is  clear  from the classification of employees in standing order 2) can  be terminated  on  grounds (a) to (f) therein set out.   It  is quite clear that the termination of service of the concerned workman cannot be attributed to any  one of  these  grounds. Therefore,   that  order  cannot  be  said  to   have   been passed  conformity with the power to terminate  his  service under the standing orders.     But apart from this consideration, the Labour Court came to a finding on the evidence before it that the real  reason for   passing  the  impugned  order  was  not  the   alleged unsatisfactory  work  on  the part of the  workman  but  his having unauthorisedly used the motorcycle and causing damage to.  it,  that  the  order was punitive  and  not  a  Simple termination  of  service  and was  therefore  in  colourable exercise  of  the  power of termination.   This  finding  is clearly one of fact and meant that the Labour Court rejected the  evidence  led by the management that the  work  of  the concerned   workman  was  ,found  unsatisfactory.    It   is impossible to say from the evidence before the Labour  Court that  finding  was  perverse  o.r  such  as  could  not   be reasonably arrived at.  In that view, it is 820 impossible  to interfere with the order of the Labour  Court relating to workman, Shameem Khan.     In the result, the appeal is partly ,allowed.  The order of  the Labour Court in connection with the 3  workmen  whom the  company retired, is set aside  but its order   relating to  workman, Shameem Khan, is confirmed.  In accordance with the  order, passed by this Court on January 24, 1969,  while granting  stay to the appellant-company,  the  company  will pay to the workman, Shameera Khan, interest at 6% per  annum on the amount of the arrears of wages still due to him under the  order  of the Labour Court.  As the  appeal  is  partly allowed  and partly dismissed, there will be nO order as  to costs. V.P.S.                                Appeal partly allowed. 821