1971 (11) TMI 165 - SC - Indian Laws

Federation's Industry Status Confirmed; Termination Ruled Illegal. Dismissed Appeal Upheld, Costs Awarded.

Management Of The Federation Of. Versus Their Workman, Shri R.K. Mittal.

The court affirmed that the Federation qualifies as an industry under the Industrial Disputes Act, 1947. It ruled the termination of the respondent's ... - Issues Involved:1. Whether the Federation is an industry under Section 2(j) of the Industrial Disputes Act, 1947.2. Whether the termination of the respondent's services was illegal and unjustified.3. Whether the punishment of discharge was disproportionate to the alleged misconduct, amounting to victimization.Detailed Analysis:1. Whether the Federation is an industry under Section 2(j) of the Industrial Disputes Act, 1947:The primary contention was whether the Federation's activities qualify it as an 'industry' under Section 2(j) of the Industrial Disputes Act, 1947. The Federation argued that its activities were charitable and non-commercial, thus not fitting within the definition of an industry. The court examined the activities of the Federation, which included promoting Indian business, organizing exhibitions, providing arbitration services, and publishing periodicals. These activities were found to be systematic and organized, involving the cooperation of employers and employees to produce material services. The court noted, 'The Federation carries on systematic activities to assist its members and other businessmen and industrialists and even to non-members... These activities are business activities and material services.' Therefore, the court concluded that the Federation is indeed an industry under Section 2(j) of the Act.2. Whether the termination of the respondent's services was illegal and unjustified:The respondent was terminated after issuing legal notices to the International Chamber of Commerce, which the Federation claimed was intended to bring disrepute to it. The court found that the respondent's actions were not intended to defame the Federation but were a legitimate effort to claim unpaid dues. The court stated, 'The Tribunal as we have noticed earlier found that this did not amount to misconduct which finding in our view is justified on the evidence.' The respondent had tendered an apology, indicating no intention to harm the Federation's reputation. The court upheld the Tribunal's finding that the termination was illegal and unjustified.3. Whether the punishment of discharge was disproportionate to the alleged misconduct, amounting to victimization:The court considered whether the punishment of discharge was disproportionate to the alleged misconduct. The respondent had served the Federation for 12 years without prior complaints and had only sought payment for overtime work. The court observed, 'Notwithstanding this apology the punishment of discharge for a workman who has served the Federation for 12 years without any cause for complaint... was far in excess of what he deserved.' The court emphasized that the absence of standing orders specifying misconduct and corresponding disciplinary actions allowed the Tribunal to assess the proportionality of the punishment. The court cited previous rulings, stating, 'where the punishment is so disproportionate that no reasonable employer would ever have imposed it in like circumstance, the Tribunal may treat the imposition of such punishment as itself showing victimisation or unfair labour practice.' Thus, the court agreed with the Tribunal that the punishment amounted to victimization.Conclusion:The court dismissed the appeal, affirming the Tribunal's findings that the Federation is an industry under Section 2(j) of the Industrial Disputes Act, 1947, the termination of the respondent's services was illegal and unjustified, and the punishment of discharge was disproportionate, amounting to victimization. The appeal was dismissed with costs.