CALTEX INDIA LIMITED versus PRESIDING OFF1CER, LABOUR COURT, AND ORS.

Citation: [1966] 3 S.C.R. 631 · Decided: 23-02-1966 · Supreme Court of India · Bench: P.B. GAJENDRAGADKAR · Disposal: Dismissed
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Judgment (excerpt)

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CALTEX INDIA LIMITED 
v. 
PRESIDING OFF1CER, LABOUR COURT, AND ORS. 
February 23, 1966 
[P. B. GAJENDRAGADKAR, C.J., K. N. WANCHOO, M. HIDAYATULLAH, 
J. C. SHAH AND S. M. S1KRI, JJ.} 
Bihar Shops and Estaulishment Act (B of 1954), s. 26(1) provloo-
Power of States Government to prescrlue what kinds of misconduct could 
be punished by dismissal/ discharge without notice under s. 26(1 )-
Provl90 whether ultra vires. 
The appellant company held an enquiry into the misconduct of two 
of its permanent employees and dismissed one of them while discharging 
the other. 
They made applications to the Labour Court under •· 26 
of the Bihar Shops and Establishments Act 8 of 1954. The said court 
issued a notice to the appellant asking it to show cause why the di,.. 
missal/ discharge should not be set aside. 
The appellant went to the 
High Coon under Art. 226 of the Constitution and, Inter alia chal-
lenged the validity of s. 26. The High Court having held that the sec-
tion 
was valid the appellant came to this Court by special leave. It 
was contended that the proviso to s. 26(1) was ultra vires because it 
rolfcred from the vice of excessive delegation in as much as it gave 
unguided power to the State Government to prescribe what kinds 
of 
misconduct were punishable with clischarge or dismissal without notice 
under s. 26(1). 
HELD : It is well known that in industrial law there are two kinds of 
misconduct, namely, (i) major misconducts which justify punishment of 
d!smi,.al I discharge and (ii) minor misconducts which do not jmtify 
punishment of dismissal/ discharge but may call for lesser 
punishments. 
Therefore when the legislature gave power to the State Government 
under cl. ( c) of s. 40 to specify which kinds of misconduct could be 
punished without notice under s. 26(1) it clearly indicated to the State 
Government to include in its list of ~isconducts such of them as are 
generally understood as major misconducts which justify the dismissal/ 
discharge of an employee. 
This was sufficient guidance to the State 
Government and it is difficult to see what other guidance the legislature 
could have given to the rule-making authority in this behalf. [633 H-
634 CJ 
Looking at the list of the several items of misconduct which were 
prescribed by the State Government under r. 20( I) it was clear that 
the State Government properly understood the guidance. 
In the circumstances it could not be said that the proviso to s. 26(1) 
was ultra vires because of the vice of excessive delegation. 
[634 HJ 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 1006 of 
1964. 
Appeal by special leave from the judgment and order dated 
August 7, 1963 of the Patna High Court in Misc. Judi. Case No. 
343 of 1961. 
Niren De, Additional Solicitor-General, A. N. Sinha and D. 
N. Gupta, for the appellants. 
·632 
SUPREME COURT REPORTS 
(1966] 3 S.C.R. 
N. S. Bi11dra and R. N. Sachthey, for respondent No. 4. 
The Judgment of the Court was delivered by 
Wancboo, J. The main question raised in this appeal 
y special leave against the judgment of the Patna High Court is 
·the constitutionality of s. 26 of the Bihar Shops and Establish-
ments Act, No. 8 of 1954, (hereinafter referred to as the Act). 
The question arises in this way. The appellant is carrying on 
business in petroleum products in the Patna district. 
Habibur 
Rahman was serving as a watchman and Abdul Rahim as a driver 
in the permanent employ of the appellant at the Dinapore depot. 
They were charged with gross misconduct and an enquiry was held 
by the appellant in that connection. Habibur Rahman was dis-
charged on May 5, 1960 and one month's pay in lieu of notice was 
offered to him. Abdul Rahim was dismissed on April 22, 1960. 
These two employees made applications under s. 26 of the Act in 
December 1960 before the labour court. l11ese applications were 
obviously barred by time. The labour court condoned the delay 
without giving any notice to the appellant on the question and 
issued notice to show cause why the dismissal/discharge be not set 
aside. 
On receipt of this notice, the appellant learnt that delay 
in making the applications had been condoned without hearing it. 
Consequently the appellant moved the High Court at Patna under 
Art. 226 of the Constitution for quashing the order of the labour 
court condoning the delay on the ground that it had been passed 
without hearing the appellant. 
Thereafter in March 1961 the 
appella
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