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PETITIONER: MANAGEMENT OF KAIRBETTA ESTATE,KOTAGIRI

       Vs.

RESPONDENT: RAJAMANICKAM AND OTHERS.

DATE OF JUDGMENT: 24/03/1960

BENCH: GAJENDRAGADKAR, P.B. BENCH: GAJENDRAGADKAR, P.B. GUPTA, K.C. DAS

CITATION:  1960 AIR  893            1960 SCR  (3) 371  CITATOR INFO :  RF         1964 SC1458  (10)  RF         1976 SC2584  (10)

ACT: Industrial Dispute--Lay-off compensation-Closure of division due   to   disturbances   by   workers--Lock-out--Subsequent reopening      of      division--Claim      for      lay-off compensation--Lock-out and lay-off,  Distinction--Industrial Disputes  Act, 1947--(14 of 1947), ss. 2(1), 2  (kkk),  25C, 25E(iii), 33C.

HEADNOTE: The  appellant’s  manager  was  violently  attacked  by  its workmen as a result of which he sustained serious  injuries. The  workers  in  the lower  division  also  threatened  the appellant’s  staff working in that division that they  would murder  them  if  they  worked  there.   The  appellant  was therefore  compelled  to notify that the division  would  be closed  until further notice.  Subsequently as a  result  of conciliation  before  the labour officer, the  division  was opened  again.   The  workers  made  a  claim  for   lay-off compensation  under s. 25C of the Industrial  Disputes  Act, 1947,  for  the period during which the lower  division  was closed  on  the footing that the management  for  their  own reasons  did  not  choose to run the  division  during  that period.   The appellant’s answer was, inter alia,  that  the closure  of the division amounted to a lock-out which  under the  circumstances was perfectly justified and as  such  the workers were not entitled to claim any lay-off compensation: Held  ;  (1) that the concept of a lock-out  is  essentially different  from that of a lay-off and where the  closure  of business  amounts  to  a  lock-out  under  s.  2(1)  of  the Industrial Disputes Act, 372 it  would  be impossible to bring it within the scope  of  a lay-off under s. 2 (kkk) of the Act. (2)that  the expression " any other reason " in S.  2  (kkk) means  any  reason which is allied or analogous  to  reasons already specified in that section. J.   K.  Hosiery  Factory v. Labour  Appellate  Tribunal  of India Anr,     A.I.R. 1956 All. 498, approved. (3)  that  the lock-out which was justified on the facts  of

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the  case, was not a lay-off and therefore the workmen  were not entitled to claim any lay-off compensation.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 91 of 1959. Appeal  by  special  leave from  the  decision  dated  March 24,1958, of the Labour Court, Coimbatore, in R.   P. No.  35 of 1958. G.   B. Pai and Sardar Bahadur, for the appellant. M.   K.   Ramamurthi  and  T.  S.  Venkataraman,   for   the respondents. 1960.  March 24.  The Judgment of the Court was delivered by GAJENDRAGADKAR, J.-This appeal by special leave is  directed against  the order passed by the Labour Court at  Coimbatore directing  the  appellant, the Management of  the  Kairbetta Estate,  Kotagiri,  to  pay  lay-off  compensation  to   its workmen,  the respondents, for the period between  July  28, 1957,  to  September 2, 1957.  This order was  passed  on  a complaint  filed by the respondents before the Labour  Court under s. 33C(2) of the Industrial Disputes Act, XIV of  1947 (hereinafter called the Act). The  material  facts leading to the  respondents’  complaint must  be set out briefly at the outset.  On July  26,  1957, Mr. Ramakrishna Iyer, the appellant’s Manager, was assaulted by  some of the workmen of the appellant.  He  suffered  six fractures  and had to be in hospital in Coonoor  and  Madras for  over  a month.  The appellant’s staff  working  in  the division known as Kelso Division was also threatened by  the workmen., As a result of these threats three members of  the staff  wrote  to the appellant on July 27, 1957,  that  they were  afraid  to go down to the lower division  and  it  was impossible  for them to work there because their lives  were in  danger.   They  added  that the  workers  in  the  lower division were threatening them 373 that  they  would murder them if they worked  in  the  lower division.   On receiving this communication from  its  staff the  appellant  notified  on the same  day  that  the  Kelso Division would be closed from that day onwards until further notice.   This notice referred to the brutal assault on  the Manager  and to the threat held out against the field  staff who were reluctant to face the risk of working in the  lower division.   It appears that the Kelso Division continued  to be  closed  until September 2, 1957, on which  date  it  was opened,  as  a  result of  conciliation  before  the  labour officer,  when the respondents gave an assurance that  there would  not be any further trouble.  The claim for layoff  is made for the said period during which the division  remained closed between July 28 to September 2, 1957. Soon  after the division was closed the respondents  made  a complaint to the Labour Court (No. 43 of 1957) under s.  33A of the Act in which they alleged that they had been  stopped from doing their work without notice or enquiry and  claimed an order of reinstatement with back wages and continuity  of service.  At the hearing of the said complaint the appellant raised a preliminary objection that the closure in  question was  a  lock-out  and that it did not amount  either  to  an alteration of conditions of service to the prejudice of  the workmen  nor  did it constitute discharge or  punishment  by dismissal  or  otherwise  under  cls.  A  and  B  of  s.  33 respectively,  and  so the petition was  incompetent.   This preliminary objection was upheld by the Labour Court and the complaint was accordingly dismissed on November 30, 1957.

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Thereafter   the   present  complaint  was  filed   by   the respondents  on January 31, 1958, under s. 33C of  the  Act. In  this complaint it was stated that the  respondents  were refused  work  from  July  28 to September  2,  1957,  "  by declaring  a lock-out of a division of the estate " and  the claim made was that, as the management for their own reasons did not choose to run the division during the said days  and laid-off  the respondents, the respondents were entitled  to claim lay-off compensation under s. 25C of the Act.  Against this complaint the appellant raised several contentions 48 374 It  was  urged  on its behalf that  the  complaint  was  in- competent  under  s. 33C and that the Labour  Court  had  no jurisdiction  to deal with it.  It was also  contended  that the  closure  of the division amounted to a  look-out  which under the circumstances. was perfectly justified and as such the  respondents  were  not entitled to  claim  any  lay-off compensation.   The  Labour Court rejected  the  preliminary objection  as  to  want of jurisdiction and  held  that  the complaint  was  competent under s. 33C.  On  the  merits  it found  in favour of the respondents and so it  directed  the appellant to pay to the respondents the lay-off compensation for  the  period  in question.  It is this  order  which  is challenged before us in the present appeal; and the same two questions are raised before us. For the purpose of deciding this appeal we will assume  that the  complaint  filed by the respondents under  s.  33C  was competent and that the Labour Court could have entertained a claim  for  lay-off  compensation if  the  respondents  were otherwise  entitled to it.  On that assumption the  question which  we  propose to decide is whether the closure  of  the appellant’s  division  during  the  relevant  period   which amounts  to  a  lock-out  can be said  to  fall  within  the definition of lay-off.  We have already pointed out that  in the earlier complaint by the respondents under s. 33A it has been held by the Labour Court that the closures question was a lock-out and as such the appellant had not contravened the provisions  of  s.  33  of the Act.   Even  in  the  present application  the  respondents have admitted  that  the  said closure  is a lock-out but they have added that  a  lock-out falls within the definition of lay-off and that is the basis for their claim for layoff compensation.  The question which thus arises for our decision is: Does a lock-out fall  under s. 2(kkk) which defines a lay-off ? Section  2(kkk)  defines a lay-off as meaning  the  failure, refusal  or inability of an employer on account of  shortage of  coal,  power  or raw materials or  the  accumulation  of stocks or the breakdown of machinery or for any other reason to  give employment to a workman whose name is borne on  the muster rolls of his industrial establishment and who has not been 375 retrenched.  There is an explanation to the definition which it is unnecessary to set out.  It is clear that tile lay-off takes place for one or more of the reasons specified in  the definition.   Lay-off  may  be due to shortage  of  coal  or shortage   of  power  or  shortage  of  raw   materials   or accumulation  of  stocks or breakdown of  machinery  or  any other reason.  " Any other reason " to which the  definition refers  must,  we  think, be a reason  which  is  allied  or analogous  to reasons already specified.  It has been  urged before  us  on behalf of the respondents that  "  any  other reason " mentioned in the definition need not be similar  to the preceding reasons but should include any other reason of

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whatsoever character for which lay-off may have taken place; and  in  support of this argument reliance is placed  on  s. 25E(iii).  Section 25E deals with three categories of  cases where  compensation  is not liable to be paid to  a  workman even  though  he may have been laid-off.  One  of  these  is prescribed  by  s. 25E(iii); if the laying-off is due  to  a strike or slowing down of production on the part of  workmen in another part of the establishment no compensation has  to be paid.  The argument is that laying-off which is specified in  this  clause  has been excepted  because,  but  for  the exception,  it  would have attracted the  definition  of  s. 2(kkk) and would have imposed an obligation on the  employer to pay lay-off compensation.  That no doubt is true; but  we do-  not  see  how  the case specified  in  this  clause  is inconsistent with the view that " any other reason " must be similar   to   the  preceding  reasons  specified   in   the definition.   If  there  is  a strike  or  slowing  down  of production in one part ,of the establishment, and if lay-off is the consequence, the reason     for  which  lay-off   has taken place would undoubtedly be  similar  to  the   reasons specified  in the definition. We are, therefore,  satisfied’ that the expression " any other reason " should be construed to mean reason similar or analogous to the preceding reasons specified in the definition.  That is the view taken by  the Allahabad  High  Court in J. K. Hosiery  Factory  v.  Labour Appellate Tribunal of India & Anr.(1). (1)  A.I.R. 1956 All. 498. 376 Let  us  now consider what a lock-out means under  the  Act. Section 2(1) defines a lock-out as meaning the closing of  a place  of  employment,  or the suspension of  work,  or  the refusal  by an employer to continue to employ any number  of persons  employed  by him. It may be relevant to  point  out that the definition of lock-out contained in s. 2(e) of  the Trade Disputes Act, 1929 (VII of 1929), had, in addition  to the present definition under s. 2(1), included an additional clause  describing  a  lock-out which  provided  that  "such closing,  suspension or refusal occurs in consequence  of  a dispute and is intended for the purpose of compelling  those persons or of aiding another employer in compelling  persons employed  by  him  to  accept  terms  or  conditions  of  or affecting  employment ". This clause has now  been  deleted. Even so, the essential character of a lock-out continues  to be substantially the same.  Lock-out can be described as the antithesis  of  a  strike.  Just as a  strike  is  a  weapon available  to the employees for enforcing  their  industrial demands, a lock-out is a weapon available to the employer to persuade  by  a coercive process the employees  to  see  his point  of view and to accept his demands.  In  the  struggle between capital and labour the weapon of strike is available to labour and is often used by it, so is the weapon of lock- out  available to the employer and can be used by him.   The use  of  both the weapons by the  respective  parties  must, however,  be subject to the relevant provisions of the  Act. Chapter  V  which deals with strikes and  lock-outs  clearly brings  out the antithesis between the two weapons  and  the limitations subject to which both of them must be exercised. Thus  the concept of lockout is essentially  different  from the concept of lay-off, and so where the closure of business amounts  to a lock-out under s. 2(1) it would be  impossible to bring it within the scope of lay-off under s. 2(kkk).  As observed  by the Labour Appellate Tribunal in  M/S.   Presi- dency  Jute  Mills  Co. Ltd. v. Presidency  Jute  Mills  Co. Employees’ Union (2), in considering the essential character of  a lock-out its dictionary meaning may be borne in  mind.

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According to the dictionary meaning (2)  [1952].L.A.C. 62. 377 lock-out  means " a refusal by the employer to furnish  work to the operatives except on conditions to be accepted by the latter collectively ". Stated  broadly  lay-off generally occurs  in  a  continuing business, whereas a lock-out is the closure of the business. In the case of a lay-off, owing to the reasons specified  in s.  2(kkk) the employer is unable to give employment to  one or  more  workmen.  In the case of a lock-out  the  employer closes the business and locks out the whole body of  workmen for  reasons which have no relevance to causes specified  in s. 2(kkk).  Thus the nature of the two concepts is  entirely different  and so are their consequences.  In the case of  a lay-off  the employer may be liable to pay  compensation  as provided  by  s.  25(C), (D) and (E) of the  Act;  but  this liability can-not be invoked in the case of a lock-out.  The liability of the employer in cases of lock-out would  depend upon  whether the lock-out was justified and legal  or  not; but whatever the liability, the provisions applicable to the payment  of  lay-off compensation cannot be applied  to  the cases of lockout.   Therefore, we hold that the lock-out  in the present    case  was  not  a lay-off, and  as  such  the respondents    are   not  entitled  to  claim  any   lay-off compensation from the appellant.  Incidentally we would like to add that the circumstances of this case clearly show that the  lock-out was fully justified.  The appellant’s  Manager had  been  violently attacked and the other members  of  the staff  working in the lower division were threatened by  the respondents.  In such a case if the appellant locked out his workmen no grievance can be made against its conduct by  the respondents. In the result the appeal is allowed, the order passed by the Labour  Court  is set aside and the complaint filed  by  the respondents  under s. 33C is dismissed.  There would  be  no order as to costs. Appeal allowed. 378