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PETITIONER: WORKMEN OF WILLIAMSON MAGOR & CO. LTD.

       Vs.

RESPONDENT: WILLIAMSON MAGOR & CO. LTD. & ANR.

DATE OF JUDGMENT07/12/1981

BENCH: ISLAM, BAHARUL (J) BENCH: ISLAM, BAHARUL (J) TULZAPURKAR, V.D. VARADARAJAN, A. (J)

CITATION:  1982 AIR   78            1982 SCR  (2)  42  1982 SCC  (1) 117        1981 SCALE  (3)1825

ACT:      Industrial Disputes Act 1947 Ss 10 and 15.      Management  granting  promotion  to  junior  employees- Rightful claim  of  senior  employees  superseded-Industrial dispute-Whether there is victimization-Jurisdiction and duty of industrial  tribunal to  declare promotions  illegal  and unjustified-In consultation  with management and union frame norms and rules for promotion.      Labour  Law-Promotion-Whether  a  managerial  function- Whether to be on subjective satisfaction of management or on some objective criteria.      Words    &     Pharases-’Victimisation’-Meaning     of- Interpretation in favour of labour whether to be accepted.

HEADNOTE:      The  Workmen   (Respondent  No.  1)  alleged  that  the Management (Appellant)  started  giving  indiscriminate  and arbitrary promotions  and/or upgradations  to  some  of  the employees  who   were  its   favourities,  disregarding  the rightful claims  of a  number of  other employees so much so that even  junior members  were given promotions superseding the rightful  claims of  the senior  employees. According to the  Union,  the  management  arbitrarily  promoted/upgraded three persons  and unjustly  denied promotion/upgradation to twelve senior  employees and that this was victimisation and unfair labour  practice, and  that these three persons after their promotion/upgradation  used to  do the  same  work  as before occupying  the same  chairs and  working on  the same tables   as    they   had    done   before   the   date   of upgradation/promotion.      As a  dispute arose  between  the  management  and  the union, the  State  Government  referred  the  issue  to  the Industrial Tribunal for adjudication. During the pendency of the reference  before  the  Tribunal  the  management  again promoted from  the General  to the  Special Grade two clerks superseding 56  senior and  efficient clerks  of the General Grade. This  issue  was  also  referred  to  the  Industrial Tribunal.      The Tribunal,  on  a  consideration  of  the  oral  and documentary evidence  adduced  before  it,  found  that  the management did not care to establish the

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43 justification of  the promotions of the persons named in the two references superseding the claim of the others, but held that it  could not give any relief to the workmen when their positive case  was that  there was  no standard or norms for giving promotion.      In the  appeal to this Court it was contended on behalf of the  Management that: (1) Promotion is not a condition of service in a private company, and (2) although there were no norms, the  promotions of  the persons  in question were not arbitrary and  that unless  victimisation was  proved by the union, the management’s action should not be disturbed.      Allowing the appeal ^      HELD: 1.  (i) The  management, in consultation with the workmen or  their representatives  and under  the direction, supervision and  control of  the Labour  Commissioner  shall frame norms/rules  fixing  quota  for  the  grades  and  for promotion/upgradation of  its workmen,  and the  upgradation and/or promotion shall be made by the management in terms of the norms/rules so framed. [51 D-E]      That meanwhile the promotions/upgradations of the three persons which  is the  subject matter of the first reference and the  promotions/upgradations of the two persons which is the subject matter of the second reference are cancelled and these workmen  shall be  at par  with the  workmen who  were superseded till  promotions/upgradations  are  made  by  the management in  terms of  the norms/rules  to be prepared. No future  promotions/upgradations  shall  be  made  until  the norms/rules are framed. [51 F-52 A]      (ii) Industrial  Tribunals are  intended to  adjudicate industrial disputes  between the management and the workmen, settle them  and pass  effective awards  in such  a way that industrial peace between the employers and the employees may be maintained  so that  there  can  be  more  production  to benefit all  concerned.  For  this  purpose  the  industrial tribunals, should  not be constrained by the formal rules of law and  should avoid  inability to  arrive at  an effective award to meet justice in a particular dispute. [48 F-G]      In the  instant case  there was  victimisation  of  the superseded workmen.  The  Tribunal  should  have,  therefore declared that  the promotions  were illegal and unjustified, being the result of arbitrary action of the management which was nothing  but unfair  labour practice  and the promotions should  have   been  cancelled.   It  should  also  have  in consultation  with  the  management  and  the  union  framed norms/rules of promotion and directed the management to give promotions/upgradations in  accordance with  those norms and rules. [48 H-49 A]      2. (i)  Although promotion/upgradation  is a managerial function it  must not  be on  the subjective satisfaction of the management  but must  be on some objective criteria. [49 E]      (ii) The normal meaning of ’Victimisation’ is being the victim  of  unfair  and  arbitrary  action.  When  the  word ’victimisation’ can  be interpreted  in two  different ways, the interpretation  which is  in favour of the labour should be 44 accepted as  they are  the poorer  section of  the people as compared to the management. [50 G, D]      Bharat Bank  Ltd. v.  Employees  of  Bharat  Bank  Ltd. [1950] S.C.R.  459: K.C.P.  Employees Association  Madras v. Management of  K.C.P. Ltd.  Madras &  Ors. [1978]  2 SCC  42 referred to.

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JUDGMENT:      CIVIL APPELLATE  JURISDICTION : Civil Appeal Nos. 351 & 352 of 1976      Appeals by  special leave from the Award dated the 31st May, 1975  of the  Seventh Industrial Tribunal, West Bengal, Published  by   the  Government   of  West   Bengal,  Labour Department in  Reference Case No. VIII-39/74, G.O. No. 3278- IR   dt. 2.4.1974.  &  VIII-282/74,  GO  No.  7537-IR  dated 10.12.1974.      D. L.  Gupta S.  K. Nandi  and Krishna  Prasad for  the Appellant.      G. B.  Pai, N. C. Shah, J. R. Das and Parveen Kumar for the Respondent.      The Judgment of the Court was delivered by      BAHARUL  ISLAM,  J.  These  two  connected  appeals  by special leave  are on  behalf of  Workmen of  M/s Williamson Magor &  Co. Ltd.  (renamed as  M/s Macneill  & Magor  Ltd.) represented by  Williamson Magor  & Company Employees’ Union (hereinafter called  ’the union’)  and are  directed against the award of the 7th Industrial Tribunal, West Bengal.      2. The material facts may be stated thus:      According to  the  union,  all  the  employees  of  the aforesaid  company,  the  respondent  before  us  (who  will hereinafter be  called ’the  management’) are the members of the union.  Disputes had  arisen between the workmen and the management but  they ended  in a  number of  agreements as a result  whereof   the  employees   derived  some   benefits. Subsequently the  management appointed one Mr. P. K. Kaul as a staff  officer, who,  according to  the union,  started to create a  cleavage between the workmen, and with that end in view,  at   his  instance,  the  management  started  giving indiscriminate and  arbitrary promotions and/or upgradations to  some   of  the   employees  who   were  its  favourites, disregarding the  rightful  claims  of  a  number  of  other employees so much so that even 45 junior  members   were  given   promotions  superseding  the rightful claims  of the  senior employees. The union took up the cause  of the  workmen with the management. According to the  union,   there  is  no  norm  and/or  standard  guiding promotion and/or  upgradation of the employees. According to the union,  the action  of the management is arbitrary, mala fide and  intended to  victimize the employees who are loyal to the union.      At the material time there were two grades of employees namely; Special  Grade, with  a  higher  scale  of  pay  and General Grade.      3. This  is an admitted position that the management do not have  any norm to determine how many clerks should be in each of the said grades or in each of the scales of pay; nor is there  any fixed  quota in the Special Grade to be filled up by  promotion from  the General  Grade; nor  is there any rule determining  the number of vacancies to be filled up by promotion or upgradation. According to the union, the normal rule should  be promotion/upgradation  by seniority. As this was not  done, unrest  cropped up.  On the management having upgraded/promoted two  junior clerks,  namely; Anil  Chandra Ghose and Parameshwar Banerjee from General Grade to Special Grade on  1.3.1972, superseding the claims of senior clerks, without assigning  any reason, the union protested. Far from rectifying  the   unjust  action,   the   management   again promoted/upgraded another  person, Shri  Saroj Mukherjee  to

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Special Grade  on 1.7.1972,  superseding the  claims of many others who  were senior  to him. According to the union, the management arbitrarily promoted/upgraded the aforesaid three persons and  unjustly denied promotion/upgradation to twelve senior  clerks.   This  was,   according   to   the   union, victimization and  unfair labour  practice. According to the union, the  aforesaid three  favoured clerks  and the twelve superseded clerks were doing exactly similar work. The three promoted/upgraded persons  after their promotion/upgradation used to  do the  same work  as before,  occupying  the  same chairs and  working on  the same  tables as  they  had  done before the  date of  upgradation/promotion. According to the union, there  were no  jobs related  to grades  or scales of pay, and the promotion upgradation has no impact except mere increase of  pay consequent  upon the  higher scale  of  pay given to  each person  promoted. As  a dispute arose between the management  and the  union the Government of West Bengal referred 46 the following  issue to  the 7th  Industrial Tribunal,  West Bengal for adjudication:           "Whether  promotion  of  Sharbashree  Saroj  Kumar      Mukharjee, Anil  Chandra Ghose  and Parmeshwar Banarjee      from General  Grade clerks  to Special  Grade Clerks in      preference  to   the  twelve  (12)  workmen  marked  in      Annexure "A"  attached herewith  is justified ? To what      relief, if  any, are the workmen marked in Annexure "A"      entitled ?  The names  of the  persons in said Annexure      "A" were the same as mentioned in paragraph 10 above".      4. During  the  pendency  of  the  aforesaid  reference before the  Tribunal,  the  respondent  on  23.5.1974  again promoted from  the General  to the Special Grade two clerks, namely Sudhir  Ranjan  Chakraborty  and  Jyoti  Prasad  Paul superseding 56  senior and  efficient clerks  of the General Grade inclusive  of the  twelve senior  grade clerks already superseded  in   1972  and   concerned  in   the  reference, aforesaid. As a dispute arose, the Government of West Bengal made  a  reference  to  the  same  Industrial  Tribunal  for adjudication of the following issue:           "Whether promotion  of the  workmen  mentioned  in      Annexure "A"  attached herewith  from General  Grade to      Special Grade or Supervisory Grade in preference to the      workmen mentioned  in Annexure "B" attached herewith is      justified ?      To what  relief, if  any, are  the workmen mentioned in Annexure "B" entitled ?"      5. Before  the Tribunal,  the parties  led evidence and proved Exts. K-l and K-2, settlements arrived at between the management of  the union  earlier. On a consideration of the oral  and   documentary  evidence  adduced  before  it,  the tribunal has arrived at the following findings:-           (1) No  agreed norm  for promotion/upgradation was      formulated.           (2) Both  the parties  felt that  it was desirable      that certain  norms should  be laid  down for promoting      and/or upgrading workmen. 47           (3) That  in spite  of the  fact that  no norm had      been  formulated, the management promoted as many as 15      workmen during the pendency of the first reference.           (4)  That   promotion  and/or   upgradation  is  a      managerial function  and that the union can have no say      in such  matter. The Tribunal has found "it is now more      or less  settled that  the promotion/upgradation is the      administrative function of the management and it can be

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    hardly disputed before any court of law and/or tribunal      unless it  is proved  that in effecting such promotion,      the  management  violated  the  principles  of  natural      justice and/or  existing rules  or norms". The Tribunal      also has  found, on  a consideration of the evidence of      the management  witness, Shri P. K. Kaul, that although      the witness  said that at the time of giving promotion,      recommendations of  the departmental  heads  and  other      authorities were  taken into  account, his evidence was      not supported  by any  document. The  tribunal has also      found that  although in terms of earlier agreements, it      was  the   duty  of   the  management   to  investigate      allegations by  the union  of discriminatory and unfair      promotion and/or upgradation, the management did not do      so. It  further found  that Ext.   B  disclosed that on      21.12.1972,  the   union  demanded  of  the  management      investigation   into    the   matter    of   the   said      discriminatory promotions  but "curiously enough, there      is nothing  before me  to show that the management did,      in compliance with the said agreement, investigate into      the matter as agreed upon."           (5)  Ultimately   the  Tribunal   held  that   the      promotions of  the three persons mentioned in the first      reference "can  not be  justified because  when it  was      agreed upon  that the  management would  investigate in      case any  complaint is  made, but  even in spite of the      complaint lodged  by the  union, the management did not      investigate." The  Tribunal has  even  found  that  the      management did  not care to establish the justification      of  the  promotions  of  the  aforesaid  three  persons      superseding the claims of others.           (6) The  Tribunal has also found, "it is not their      (management’s)  case  before  me  that,  in  fact,  the      manage- 48      ment found  those three persons suitable to the rest of      the workmen.           (7)  Similarly,   with  regard   to   the   second      reference,  the  Tribunal  came  to  the  finding  that      "junior persons  were given  promotions superseding the      claims of  a number  of senior  workmen, but  there  is      nothing before  me  from  where  I  can  say  that  the      management was justified in giving promotion to them."      6.  The  above  enumeration  of  the  findings  of  the Tribunal clearly  shows that the action of the management in promoting junior clerks of the General Grade superseding the claims of  the senior clerks of the same Grade was arbitrary and unjustified. The Tribunal has categorically found, "I am constrained to  observe that  no material  has  been  placed before me  nor it  has been  claimed in  evidence  that  the management found  that these  people were more efficient and competent than the rest of the workmen.      In the  premises, I  am bound  to hold  that  I  cannot justify the  promotion of  the said persons named in the two references and  dispose  of  the  first  issue  accordingly" (emphasis added).  But to  our amazement,  it failed to pass any consequential  order, and  instead held,  "I cannot give any relief to these workmen when their positive case is that there is  no standard  or norms  for giving  promotion."  In other words,  although the  Tribunal categorically held that the  actions   of  the   management  were   unjustified,  it expressed, its  inability to  give any relief to the workmen in the  case. We do not think that the Tribunal should be so powerless.  The   industrial  tribunals   are  intended   to adjudicate industrial  disputes between  the management  and

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the workmen,  settle them, and pass effective awards in such a way  that industrial  peace between  the employers and the employees may  be maintained  so  that  there  can  be  more production to  benefit all concerned. For the above purpose, the industrial  tribunals, as far as practicable, should not be constrained  by the  formal rules of law and should avoid inability to arrive at an effective award to meet justice in a particular  dispute. The  Tribunal in the instant case, in view of its findings, first of all should have declared that the promotions of the aforesaid fifteen persons were illegal and  unjustified,  their  promotions  being  the  result  of arbitrary action  of the  management which  was nothing  but unfair labour  practice,  and  the  promotions  in  question should have been cancelled. 49 The Tribunal  also, in our opinion, in consultation with the management and  the union, should have framed norms/rules of promotions   and    directed   the    management   to   give promotions/upgradations    in    accordance    with    those norms/rules.      7. We  do not  agree with  the claim  of the union that promotions  or  upgradations  should  be  on  the  basis  of seniority alone.  The National  Industrial Tribunal  in  its award gave the following wholesome directions:-           "I  give   the  general  formula  which  has  been      accepted by  many concerns,  namely, all  things  being      equal, seniority  shall count  for  promotion.  If  the      senior person  has been  overlooked in  the question of      promotion, he  is at  liberty to  ask the  concern  for      reason why  he has  been overlooked,  in which case the      concern shall  give him  the reasons  provided that  it      does not  expose the  concern or the officer giving any      reasons to any civil or criminal proceedings".      The management  has failed  to follow this direction in the case in hand.      Although  we  agree  that  promotion/upgradation  is  a managerial function,  it  must  not  be  on  the  subjective satisfaction of the management but must be on some objective criteria,      8.  Mr.   Pai,  learned   counsel  appearing   for  the management, made  two submissions  before  us.  Firstly,  he submitted  that   unlike  in   public  sector  undertakings, promotion is  not  a  condition  of  service  in  a  private company. We  are unable  to accept the submission of Mr. Pai in  toto.   If  there  is  no  scope  of  any  promotion  or upgradation or  increase in salary in a private undertaking, the submission  of the  learned counsel may be justified but if there  are grades and scopes of upgradation/promotion and there are  different scales of pay for different grades in a private undertaking,  and, infact,  promotion  is  given  or upgradation is  made, there should be no arbitrary or unjust and  unreasonable   upgradation  or   promotion  of  persons superseding the claims of persons who may be equally or even more, suitable.  The second  submission of  Mr. Pai  is that although there  were no norms, the promotions of the persons in question  were not  arbitrary and that the finding of the Tribunal in  this regard  were incorrect.  He led us through the material evidence 50 of the witness examined. We are unable to agree with learned counsel and  do not  find any  reason  to  differ  from  the findings of  the learned Tribunal that the promotions of the fifteen persons were arbitrary and unjustified. Mr. Pai also submitted that unless victimization was proved by the union, the management’s  action should  not be  disturbed. The word

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’victimization’ has  not been define in the statue. The term was considered  by this  Court in  the case  of Bharat  Bank Limited  v.   Employees  of  Bharat  Bank  Ltd.  This  Court observed, "It  (victimization) is  an ordinary  English word which means  that a  certain person  has become a victim, in other words,  that he  has  been  unjustly  dealt  with".  A submission was made on behalf of the management in that case that ’victimization’  had  acquired  a  special  meaning  in industrial disputes  and connoted  a person  who became  the victim of  the employer’s wrath by reason of his trade union activities and  that the  word could  not relate to a person who  was   merely  unjustly   dismissed".  This  submission, however, was not considered by the Court. When, however, the word ’victimization’  can be  interpreted in  two  different ways, the  interpretation which  is in  favour of the labour should be  accepted as  they are  the poorer  section of the people compared to the management.      This  Court   in  the  case  of  K.  C.  P.  Employees’ Association, Madras  v. Management of K. C. P. Ltd. Madras & Ors. observed:           "In Industrial Law, interpreted and applied in the      perspective of Part IV of the Constitution, the benefit      of reasonable  doubt on law and facts, if there be such      doubt, must  go to  the  weaker  section,  labour.  The      Tribunal  will   dispose  of   the  case   making  this      compassionate approach  but without  over-stepping  the      proved facts".      We would  therefore accept  the interpretation  of  the word ’victimization’  in the  normal meaning  of  being  the victim of  unfair and  arbitrary action, and hold that there was victimization of the superseded workmen.      9. Even  if promotion may not be a condition of service in a  private company  and promotion  may be the function of the manage- 51 ment, it may be recognised that there may be occasions where the Tribunal  may have  to cancel the promotions made by the management where  it is  felt that  persons superseded  have been  so  superseded  on  account  of  legal  mala  fide  or victimization (See  1966 (2)  SCR 465). Although in spite of the allegations of mala fide, the union has not been able to prove factual  mala fide,  in this  case malice  in law  and effectual victimization  are obvious  due to  the fact  that unjustified promotions  of some  junior  persons  were  made superseding, without any reason or necessity, the cases of a large number of senior persons.      10. As  a result  of the  foregoing considerations,  we allow  the   appeals  and,  accepting  the  finding  of  the Tribunal, give the following directions:      (1) The management, in consultation with the workmen or their representatives  and under  the direction, supervision and control  of the Labour Commissioner of the region, shall frame norms/rules  fixing  quota  for  the  grades  and  for promotion/upgradation of  its workmen,  in the  light of the observations made  above, within two months from the date of the receipt  of a  copy  of  this  judgment  by  the  Labour Commissioner.      (2) The  upgradation and/or  promotion shall be made by the management in terms of the norms/rules so framed.      (3)  That   meanwhile  the  promotions/upgradations  of Sharbashree Saroj  Kumar Mukherjee,  Anil Chandra  Ghose and Parameshwar Banerjee  from General  Grade to  Special  Grade clerks in  preference to  the twelve  workmen  mentioned  in Annexure ’A’,  which is  the subject  matter  of  the  first reference, namely,  No. 3278-IR/IR/11L-13271  dated April 2,

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1974,  and   the  promotions/upgradations   of  the  persons mentioned in  Annexure ’A’ from the General Grade to Special Grade or  Supervisor Grade  in  preference  to  the  workmen mentioned in  Annexure ’B’,  which is  the subject matter of the second  reference, namely, Reference No. 7537-IR/IR/11L- 132/71 dated  December 10,  1974,  are  cancelled;  and  the workmen whose  promotions are  cancelled and the workmen who were superseded shall be at par with effect from the date of this judgment  till promotions/upgradations  are made by the management in  terms of  the norms/rules to be prepared; and no future promo- 52 tions/upgradations shall  be made  until the norms/rules are framed.      11. The appeals are allowed with costs.      12.  Send  a  copy  of  this  judgment  to  the  Labour Commissioner forthwith. N. V. K.                                    Appeals allowed. 53