MANAGEMENT UTKAL MACHINERY LTD. versus WORKMEN, MISS SHANTI PATNAIK

Citation: [1966] 2 S.C.R. 434 · Decided: 27-10-1965 · Supreme Court of India · Bench: P.B. GAJENDRAGADKAR · Disposal: Case Partly allowed

Cited by 2 judgment(s) · cites 1 · see the full citation network in Lexace

Judgment (excerpt)

MANAGEMENT UTKAL MACHINERY LTD. 
v. 
WORKMEN, MISS SHANTI PATNAIK 
October 27, 1965 
[P. B. GAJENDRAGADKAR, C.J., K. N. WANCHOO, 
M. HIDAYATULLAH, V. RAMASWAMI AND 
P. SATYANARAYANA RAJU, JJ.] 
Industrial Dispute-Termination of Enip/oyee's 
services-Power of 
Tribunal to enquire into--N ecessity of enquiry before discharge on 
ground of unsatisfactory work-Amount of compensation. 
The respondent entered into the service of the appellants on December 
9, 1961 at a monthly salary of Rs. 400. 
On April 30, 1962 she was 
given notice of termination of her services. 
She thereupon raised 
an 
industrial dispute which was referred by the Government of Orissa to 
an Industrial Tribunal. The respondent alleged before the Tribunal thal 
the termination of her services was improper, ma/a fide and an act of 
victimisation. The case of the ,appellant was that the respondent had 
been appointed on probation for six months, and her work having been 
found unsatisfactory •he had been discharged in terms of the contract. 
The Tribunal held that the termination of the respondent's services was 
ma/a fide and awarded her two years salary, namely Rs. 9,600 as com-
pensation, fo appeal to this Court on jx,half of the management by 
special leave. 
HELD : (i) If the discharge of an employee has been ordered by 
the management in bona fide exercise of its power, the Industrial Tribunal 
will not interfe:re with it, but it is open to the Industrial Tribunal to 
consider whethe:r .the order of termination is ma/a fide or whether it 
amounts to victimisation of the employee or an unfair labour practice: or 
is so capricious or unreasonable as could lead to the inference that it 
had been passed for ulterior motives and not in bona fide exercise of 
the power arising out of the contract. In such a case it is open to the 
Tribunal to interfere with the order of the management and to afford 
proper relief to the employee. [437 C-EJ 
(ii) The respondent could not be said to have been discharged in the 
terms of the contract. There was no Standing Order of the company 
with regard to punishment for 
misconduct. 
In the 
absence of any 
Standing Order the unsatisfactory work of an employee may be treated 
as 
misconduct. 
When the management discharged the respondent for 
alleged unsatisfactory work it should be taken that the discharge was 
tantamount to punishment for alleged misconduct. If this was so, the 
management was not justified in discharging the respondent without hold-
ing proper enquiry. 
Even before the Labour Court no evidence was 
adduced by the management to show that the work of the 
respondent 
was unsatisfactory. In these circumstances the discharge of the respon-
dent was ma/a fide and she was entitled to compensation. [437 F-H] 
(iii) There were no special circumstances in the case to justify the 
award of two years' salary as compensation. It was sufficie.nt to award 
Rs. 4,800. [439 A] 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 581 of 
1964. 
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II 
UTKAL MACHINERY LTD. v. SHANTI PATNAIK (Ramaswami, !.) 435 
A 
Appeal by special leave from the award dated May 24, 1963 
of the Labour Court, Orissa in Industrial Dispute No. 5 of 1962. 
/. N. Shroff, for the appellant. 
The respondent did not appear. 
I 
The Judgment of the Court was delivered by 
Ramaswami, J. 
This appeal is brought, by special leave, 
• 
against the award of the Labour Court, Orissa dated May 24, 
1963 in Industrial Dispute No. 5 of 1962 published in the Orissa 
Gazette dated June 14, 1963. 
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The respondent-Miss Shanti Patnaik-took her degree in 
Master of Arts (Political Science) in 1961. At that time, Major 
General Pratap Narain was the General Manager of Utkal Machi-
nery Ltd. (hereinafter referred to as the 'Management'). On 
December 9, 1961 Major General Pratap Narain appointed the 
respondent as his Secretary on a monthly salary of Rs. 400. She 
was thereafter transferred to the Personnel Department of the 
Company as an Assistant. It appears that Shri A. L. Sarin joined 
as Personnel Officer on January 2, 1962. The respondent alleges 
that on April 30, 1962 she was given notice for termination of 
her service. On her representation she was informed on May 30, 
1962 that the decision of the management to dispense with her 
service was final. The allegation of the respondent is that taking 
advantage of her subordinate official position Mr. 
Sarin mis-
behaved with her to which she of

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