A. Dutta vs The State (Regional Labour Commissioner)

Debabrata Mookerjee, J.—This is a petition for revision of an order made by a Presidency Magistrate, Calcutta, by which the Petitioner was convicted u/s 29 of the Industrial Disputes Act and sentenced to pay a fine of Rs. 200 in default to suffer simple imprisonment for two months.

Pursuant to a dispute between the employers of Rajasthan Insurance Co. Ltd. and their employees, an award was made on May 29, 1952, by the Industrial Tribunal, Calcutta, which was published in the Gazette of India on June 21, 1952. The award was in pursuance of a mutual settlement arrived at between the parties and it provided for payment of increased salary, dearness allowance at enhanced rate and for other amenities included in the award. There was failure on the part of the employers, that is to say, the Rajasthan Insurance Co. Ltd., to implement the terms of the award and the Petitioner was the manager and whose duty it was to implement them was prosecuted u/s 29 of the Industrial Disputes Act before a Presidency Magistrate, Calcutta.

The necessary sanction of the appropriate authority was obtained before the Institution of the complaint.

At the trial the prosecution examined five witnesses in support of the case they made. Of these, G.S. Ahluwalia, P.W. 1 (Regional Commissioner. Central Government, Calcutta), deposed that the dispute between the employers and the employees of the Rajasthan Insurance Co. Ltd. had been adjudicated upon by the Industrial Tribunal which resulted in an award which was in due course published in the Gazette of India. Information having reached the authorities concerned as respects the failure to implement the award an enquiry or investigation started which confirmed the complaint about the breach whereafter sanction was applied for and obtained for prosecution of the Petitioner who was the Manager of the Company at the time when the award was made and consequently liable for implementation of the same. A Labour Inspector and a Conciliation Officer were also called to give evidence and they proved failure of implementation of the award. Two witnesses who are employees of the Insurance Co. were also examined by the prosecution in support of the case and they between them proved that the management of the company had failed to implement the award and details were deposed to showing wherein the failure had occurred.

The Petitioner pleaded innocence and his case was that although there was an award it was subsequently modified as a result of private arrangement between the management of the Insurance Co. and the employees and that this private agreement or arrangement was given effect to in modification of the award. The learned Magistrate who dealt with the case believed the prosecution evidence and convicted and sentenced the Petitioner as stated above. Thereafter the Petitioner applied to this Court and obtained the present Rule.

Mr. Sinha appearing in support of this Rule has raised several contentions. In the first place, he has argued that the award as made has been substantially implemented and that on the evidence in the case it is not possible to say with any amount of certainty that failure to implement the same has been satisfactorily proved. Secondly, the agreement or arrangement arrived at privately between the management and the employees in supersession of the award, has been proved abundantly by facts and circumstances transpiring from the evidence in the case so that a conviction for failure to implement the award cannot possibly be sustained. Thirdly, the prosecution has not been properly instituted in the sense that sanction was not accorded by the proper person nor facts relevant to the case were properly placed before the sanctioning authority with the effect that the resultant trial and conviction have been vitiated. Fourthly, when the prosecution was commenced the Petitioner had ceased to be the manager of the Company so that he could not legally be prosecuted for failure to implement the award. These contentions require to be examined.

I shall deal with the second contention first. The private arrangement pleaded by the Petitioner as having been made in supersession of the award has not at all, in my view, been established. The award had its own binding force under the provisions of the Industrial Disputes Act. Sub-section (1) of Section 17A lays down that the award of a Tribunal shall become enforceable on the expiry of thirty days from its publication. Where no date is specifically mentioned as the date on which the award shall come into force, there is a further provision that the award becomes enforceable upon the expiry of 30 days as provided under Sub-section (1) of Section 17A. Section 19 of the Act provides that an award shall, subject to the other provisions of that section, remain in force for a period of one year. There is of course a proviso which gives the proper authority power to extend its operation for another year. Sub-section (6) further provides that the award shall continue to be binding on the parties until a period of two months has elapsed from the date of which notice is given by any party bound by the award to the other intimating its intention to terminate the award. The argument that has now been advanced is that in view of this provision which entitles a party to the award to terminate it by notice, the award becomes absolutely of no effect as soon as the statutory period of two months elapses from the date the notice is served. It is argued that in the instant case a notice was served in June, 1953 and consequently the award was no longer effective two months thereafter since it had been terminated in accordance with the provision of Section 20(6). It is said once there has been this termination, the award loses all its force and cannot possibly be the subject-matter of a prosecution for alleged failure of implementation of the terms of that award which has been killed effectively for ail purposes by the notice. I am wholly unable to agree with this proposition. The different Sub-sections to Section 20 make it clear that the award is in force during a stated time and that it can be terminated upon fulfilment of a certain condition, viz., the giving of a notice. But that cannot possibly have the effect of retrospectively affecting the validity of an award during the period it was in force and the prosecution which is based upon an alleged breach of the award or failure of implementation of its terms during the period of its subsistence cannot possibly be questioned.

The agreement or arrangement that is pleaded by the defence in this case cannot, in my view, supersede an award as long as it was in force. The entire structure of the defence case seems to be based upon the view that it was open to the Petitioner to vary or modify the terms of the award by means of private arrangement and no prosecution can be sustained even if proof was offered of breaches of the award or of failure of implementation of its terms. As I have already indicated this contention is basically unsound and cannot possibly be of any assistance to the defence. The award stands good as long as its life is not terminated by act of parties or efflux of time. It is no defence to a charge u/s 29 of the Act to say that the notice of termination retrospectively operates to render the terms utterly otiose. The party affected cannot successfully plead a private agreement in supersession of the award and avoid the penalty which the statute imposes u/s 29 of the Act for breach of the award when it was operative suo vigore.

The next contention is that sanction was not properly obtained for the present prosecution and that the materials placed before the sanctioning authority were not adequate so that it could not be said that the authority concerned had occasion to apply its mind to the question of the desirability or otherwise of instituting the present prosecution. This objection covers a wide field trenching upon facts. The facts as they have been investigated by the Magistrate and partly also by this Court on the invitation of the Petitioner, clearly indicate that relevant materials were placed before the sanctioning authority and there can be no justifiable reason to think that the prosecuting authority accorded sanction without applying its mind to the necessary materials. It is to be observed that the Under-Secretary to the Government of India was the person who gave it and that the facts of the case were adequately placed before him in order that he might be enabled to apply his mind to the desirability or otherwise of the present prosecution. P.W. 1 G.S. Ahluwalia gave evidence in the case and proved the sanction and it is quite clear from the materials available on the record that the necessary facts were all present to the mind of the sanctioning authority when the prosecution was ordered.

The next contention raised is that on the date the prosecution was instituted there was no award in existence and consequently no proceedings u/s 29 of the Act could lawfully be commenced against the Petitioner. I am afraid this contention is absolutely untenable. It proceeds on the footing that an award is in the nature of a temporary legislative enactment which after having run out its life cannot possibly give rise to any prosecution. But here the position is entirely different. The award stood good for some time until it was terminated by an act of parties. The complaint is that during the time the award was operative breaches occurred in the shape of non-implementation of the terms of the award. The award may have, after a certain date, been non-existent but that would not work backward to wipe out the award and make a person guilty of breach or of non-implementation, which is made punishable, under the Act, immune from prosecution. A breach that has occurred during the life of the award is a breach of the law and has to be punished under the provisions of the Industrial Disputes Act. By the happening of a certain event, namely, termination of the award by means of a notice, the liability of the person who committed the breach or the infraction in the shape of omission or neglect to implement the terms of the award cannot possibly be affected. Mr. Banerjee appearing on behalf of the State drew my attention to a decision of the Supreme Court in the case of State of Madras v. C.P. Sarathy and Anr. (1953) S.C.A. 965, in which it was clearly ruled than when a person committed breach of some of the terms of an award made under the Industrial Disputes Act which was in force at the time be incurred the liability, he is to be prosecuted for an offence made punishable u/s 29 of the Act. The fact that the award has subsequently expired cannot affect the question of liability already incurred. It is thus clear both on authority and principle that this contention raised by Mr. Sinha is untenable.

Mr. Sinha has next argued that on the date the prosecution was launched, the Petitioner was not the manager of Rajasthan Insurance Co. Ltd. and consequently he could not be prosecuted in law for failure to implement the terms of the award. I cannot appreciate this contention. A man''s liability is determined by reference to acts and conduct referable to the time when he sustains a particular character when the status or character of that person is relevant to the commission of the crime charged. The fact that on a subsequent date, i.e., the date when the prosecution happened to be launched he ceased to have that character is wholly immaterial. There can be no question whatever that at the material time the Petitioner was the manager and that his liability as such cannot be avoided by pleading that he ceased to be the manager at the time when he came to be actually prosecuted u/s 29 of the Industrial Disputes Act.

Lastly, Mr. Sinha has argued that in view of the evidence in the case it cannot be said that there has been any proof of breach of the award or failure to implement its terms. My attention was invited to certain exerpts from the evidence of some of the witnesses for the prosecution, in support of thi3 contention. It is not necessary to review the entire evidence and it is sufficient to say that the materials available do make out a case of failure to implement some, at any rate, of the terms of the award.

Mr. Banerjee appearing for the State has quite fairly stated that if there is anything in the evidence suggestive of any doubt as respects implementation the Petitioner will be entitled to the benefit of it. But at the same fame he has drawn my particular attention to two items of the evidence which establish clearly failure of implementation of the award. The award related to various items including adjustment and increment of salary, dearness allowance, payment of bonus, provident fund, gratuity staff insurance, conditions of service etc. There is evidence on the record to indicate that the award as respects dearness allowance has been implemented only in part and that the working hours have not been adjusted according to the recommendations made. As regards other items embodied in the award there may perhaps be some doubt whether they were implemented or not. It must be held that the Petitioner was not entitled to say that he was not bound by the terms of the award but only by the terms of the private agreement or settlement reached. No reference can be made to the latter to determine the question of implementation. I do not think any useful purpose will be served by detailing the other items of evidence as respects which it might be said that the matter is not completely free from doubt; but so far as the two items which have just been mentioned are concerned, they admit of no doubt whatever that the terms have not been implemented. That the terms have been implemented with the exception of only two is a question which merely affects the quantum of punishment and does not affect the question of conviction.

Even by giving effect to the contention raised by Mr. Sinha that in view of Exs. B and C which purport to be receipts granted by some of the employees containing endorsements on the reverse that money was received by the recipients in settlement of their dearness allowance and salary, the position, in my view, is not affected by reason of the fact that there has been proof of failure to implement the terms fully. That evidence has been believed by the Magistrate and I am not prepared in revision to interfere with this finding of fact. In view of the circumstances of the entire case, I think the ends of justice will be sufficiently met if the sentence of fine of Rs. 200 is reduced to a fine of Rs. 100 (Rupees one hundred only) in default simple imprisonment for one month.

With this modification, the Rule is discharged.