HINDUSTAN STEELS LTD., ROURKELA versus A. K. ROY & ORS.

Citation: [1970] 3 S.C.R. 343 · Decided: 18-12-1969 · Supreme Court of India · Bench: J.M. SHELAT · Disposal: Appeal(s) allowed

Cited by 3 judgment(s) · cites 2 · see the full citation network in Lexace

Judgment (excerpt)

A 
B 
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H 
HINDUSTAN STEELS LTD., ROURKELA 
v. 
A. K. ROY & ORS. 
December 18, 1969 
(J. M. SHELAT AND C. A. VAIDIALINGAM, JJ.] 
343 
Industrial Tribunal-Discretion-Termination of service for reasoru 
of security-Tribunal ordering reinstatement-Duty 
of Tribunal 
to 
exercise discretion properly-Constitution of 
India Article 
226--High 
Court's duty to interfere in cases of improper exercise of discretion. 
The first respondent was appointed in 1958 as a skilled workman by 
the appellant Company. He had executed a bond to serve the Company 
for five years in consideration of the Company having borne the expenses 
of his training. 
In accordance with the practice of the Company a veri· 
fication report about him was called for as was done iii. the case of other 
workmen also. 
On a report 1from the Police the Security Officer recom-
mended that it was not desirable to retain the respondent in the com-
pany's service any longer. 
The respondent at the time was working a':i 
a fitter in the blast furnace of the works. 
In December 1960 he was 
served with an order by which his service was terminated.· The Industrial 
Tribunal, on a reference of the dispute. rejected the Union's allegation 
as to victimisation or unfair labour practice. 
Nevertheless it held tltat it 
was improper on the part of the Company not to have disclosed the !report 
to the respondent. that the order of termination was in fact punitive in 
nature and considering the action taken as disproportionate the order was 
illegal and unjustified. The Tribunal therefore di!rected reinstatement with 
full back wages. 
On a petition for a Writ of Certiorari the High Court 
upheld the Tribunal's order. 
It also held that the case was not one of 
those exceptions to the general rule of reinstatement and the Tribunal 
having exercised its discretion it could not interfere with the Tribunal's 
order. The appeal to this Court was limited only to the question whether 
the relief to the first respondent should have been reinstatement or com· 
pensation. 
HELD : ( l) In the circumstances of the case the Tribunal was not 
justified in directing reinstatement and the High c;ourt erred in 'refusing 
to interfere with the order of the Tribunal merely on the ground that it 
could not do so as it was a case where the Tribunal had exercised its 
l~iscretion. 
lhe Tribunal has the discretion to award compensation instead of 
reinsta1ernent if the circumstances of a particular case are· unusual or 
exceptional so as to make reinstatement inexpedient or improper. 
The 
Tribun~I has to exercise its discretion judicially and in accordance with 
1he well recognised principles in that 'regard and has to examine carefully 
the circumstances of each case and decide whether such a case is one of 
those exceptions to the general rule. 
If the Tribunal were to exercise 
its C·iscretion in disregard of such circumstances or the 
principles 
laid 
down by this Court it would be a case either of no exefcise of discretion 
or cf one not legally exercised. Jn either case the High Cour.t in exerc.ise 
nf its jurisdiction can interfere 
and cannot be content bv simply saying 
that since the Tribunal has exercised its discretion. 
it will not examine 
the circum~tances of the case to ascertain whether or not such exercise 
'344 
SUPREME COURT REPORTS 
[1970] 3 S.C.R. 
was properly and in accordance with settled principles made. 
If the 
A 
High Court were to do so, it would be a refusal on its paTt to exercise 
jurisdiction. [351 B-E] 
In the present case the termination of service was not on account of 
victi'!'isation or 
un~air labour practice. 
It is clear that the Company 
terminated the service of the workman only because it felt that it was 
not desfrable for reason of security to continue the workman in its service. 
Therefore what was relevant at the stage when the Trit?:unal came to 
decide what relief the workman was entitled to was the question whether 
the manngement genuinely apprehended as a result of the report that it· 
would be risky to retain the workman in the company's service. 
If, on 
an examination, of the circumstances c:if the case the Tribunal came to 
the conclusion that the apprehensions of the eniplayer were genuine and 
the employer truly felt that it was hazardous or prejudicial to the interests 
of the industrv to retain the workman in his 
service 
on 
grourds 
of 
security the case would be 
properlv one 
"-'here 
compensation 
would 
meet 

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