PETITIONER:
PUNJAB NATIONAL BANK Ltd.
Vs.
RESPONDENT:
SRI RAM KANWAR, INDUSTRIAL TRIBUNAL,DELHI.
DATE OF JUDGMENT:
20/12/1956
BENCH:
DAS, S.K.
BENCH:
DAS, S.K.
BHAGWATI, NATWARLAL H.
AIYYAR, T.L. VENKATARAMA
SINHA, BHUVNESHWAR P.
CITATION:
1957 AIR 276 1957 SCR 220
ACT:
Industrial Dispute-Travelling and halting allowances to the
workers’ representatives-Order of the Tribunal directing
employer Payment of such expenses pending adjudication
proceedings–jurisdiction -Practice of the industrial
Courts-Costs–Discretion of the, Tribunal-Industrial
Disputes Act 1947 (XIV Of 1947), s. 11(3) (7)-Code of Civil
Procedure. (Act V of 1908), s. 35.
HEADNOTE:
Sub-section (7) Of s. ii of the Industrial Disputes Act,
1947, as inserted by Act 48 of 1950, provides: ” Subject to
the rules made under this Act, the costs of, and incidental
to, any proceeding before a Tribunal shall be in the
discretion of that Tribunal, and the Tribunal shall have
full power to determine by and to whom and to what extent
and subject to what conditions, if any, such,
221
costs are to be paid and to give all necessary directions
for the purposes aforesaid, and such costs may, on
application made to it by the person entitled, be recovered
as arrears of land revenue or as a public demand by the
appropriate Government. t.
During the pendency of the proceedings before the Industrial
Tribunal for the adjudication of a dispute between the
appellant Bank and its workman, an application was made by
one of the’ representatives of the, workmen praying inter
alia that the appellant should be ordered to pay travelling
and halting allowances for the representatives of the
various Unions coming from different, stations other than
‘Delhi to attend the hearing before the Tribunal at Delhi,
on the ground that the appellant had branches all over India
and that there ‘Were several Unions of. its employees at
those branches who were, involved in the dispute in
question. The Tribunal while conceding that there was no
provision of law in support of the claim, made by the res-
pondents nevertheless made the order relying on the general
practice of the Industrial. Courts. The appellant appealed
by special leave and contended that the order was wholly
without jurisdiction and was also unjust, while the
respondents supported the order relying on s. II (7) Of the
Industrial Disputes Act, 1947:
Held, that the order of the Tribunal was without
jurisdiction and could not be- supported either on the basis
of the general practice of the Industrial Courts or with
reference to the provisions of s. II (7) Of the Act, because
(1) there was no uniform or consistent practice in the
matter and even if there was any such practice, it was
neither warranted by law nor by the principles of reason and
justice ; (2) on a proper construction’ of the sub-section
there was no power in the Tribunal to direct the payment of
the costs of a party in advance by the other party,
irrespective of the final result of the proceeding.
The discretion which is given to a Tribunal under s. II(7)
of the Act is a judicial discretion and must be exercised.
according to the rules of reason and justice, not by chance.
or caprice or private opinion or some fanciful idea of
benevolence or sympathy.
jeevan Textile Mills, Hyderabad (Deccan) v. Their Workmen,
(1956) I L.L.J. 423- approved.
Certain Banking Companies v. Their Workmen, (1952) 2 L.L.J.
54, in so far as it decided that the :Tribunal had power and
jurisdiction under s. I 1(7) of the Act to direct the Banks
to meet the expenses of the workmen in a pending proceeding,
disapproved
JUDGMENT:
CIVIL APPELLATE JURISDICTION : Civil’ Appeal No. 134 of
1955.
Appeal by -special leave from the order dated April 17,1954,
of, Sri Ram Kanwar, Industrial Tribunal, Delhi, made on an
application filed, on April 17, 1954.
222
Ram Lal Anand and Naunit Lal, for the appellant.
Y. Kumar, for respondent No. 13.
1956. December 20. The Judgment of the Court was delivered
by
S. K. DAS J.-The Punjab National: Bank Ltd. is the
appellant before us. Shorn of all details not necessary for
our purpose, the facts are these. By its Order No. LR-
100(98) dated September 2, 1953, the Government, of India,
Ministry of Labour, appointed Shri Ram Kanwar, respondent
No. 1, as the Industrial Tribunal for the adjudication of a
dispute which had arisen between the appellant and its
workmen in respect–of the following matter:
“Absorption of Bharat Bank employees in the Punjab National
Bank Ltd., and their service conditions.”
On April 17, 1954, in the course of certain preliminary
proceedings before respondent No. 1, -an application was
made on behalf of the All India Punjab National Bank
Employees’ Federation, in which it was stated that a number
of other Unions Were involved in the dispute in question,
because the appellant had branches all over India and there
were several Unions of its employees at those branches. It
was further stated in the application that some of those
Unions had submitted their statements when the dispute in
question was referred to the Industrial Tribunal , Bombay,
with Shri Panchapagesa Shastri as its sole member and
Chairman; that Tribunal did not, however, function as Shri
Panchapagesa Shastri was appointed a member of the Labour
Apllate Tribunal of India. Two substantial prayers were
made in the application of April 17, 1954: one was that due
publicity of the adjudication proceedings should be given by
issuing notices to all those Unions to participate in the
proceedings, and the second prayer was that an order should
be made directing the appellant to pay travelling and
halting allowances to the representatives of the various
Unions so as to enable the latter to send their
representatives to Delhi, the place where the.
223
adjudication proceedings were pending. A list of fourteen
Unions and organisations was given along with the
application, with the number of representatives which each
Union or Organisation wished, send.
In the present appeal we are concerned only with the second
prayer made in the aforesaid application,, and the order
which respondent No. I made with regard to that, prayer,
being the order impugned before us, was in these terms:
“ The management objects to the grant of any T. A. or
halting allowance to the representatives of the Unions. It
is, no doubt, correct that there is no pro-, vision of law
on this point in favour of the representatives, but the
general practice of various Tribunals has all along been to
allow reasonable T. A. and halting allowance to the
representatives of the Unions, specially in Banks’ cases.
It is, therefore, ordered that the representatives of the
Unions, who put in appearance in the Tribunal from stations
outside Delhi, shall be paid 2 1/2 second class railway
fares to and from Delhi, plus Rs. 10/- per day as halting
allowance, by the management of the Bank.
The Bank is also requested to direct its respective branches
to pay travelling and halting allowances in advance to the
employees who intend to come to Court. as representatives.”
It may be stated here that out of the fourteen Unions and
organisations which wanted to send their representatives to
take part in the adjudication proceedings, two have their
offices in Delhi. Respondent No. 1 directed the payment of
travelling and halting allowances to the representatives of
the remaining twelve Unions and organisations and fixed the
number of representatives to be sent by each Union or
organisation.
The plea of the appellant was that the order passed by
respondent No. I was wholly without jurisdiction and was
also unjust, involving as it did an expenditure of not less
than Rs. 2,500/- for each day of hearing in
224
the ‘Courts of the, proceedings before respondent No. 1. On
that plea the appellant moved the Punjab High Court for the
issue of ‘a writ of certiorari – or such other writ as might
be appropriate for the purpose of quashing the order of
respondent No. 1. The Punjab High Court, however, dismissed
the petition of the appellant, in limine on May 14, 1954.
The appellant’ then asked for and obtained special leave
from this Court on October 18, 1954.
The question for decision is a very short one. The
respondents, appearing before us have sought to support the
impugned order on the strength of the provisions of sub-a.
(7) of s. 11 of the Industrial Disputes Act, 1947 (XIV of
1947), hereinafter referred to as the Act That sub-section
which was added by Act 48 of 1950 and, which we shall
presently read, lays down, inter alia, that the costs of,
and incidental to, any proceeding before a Tribunal shall be
in the discretion of that Tribunal, and the Tribunal shall
have full power to determine by and to whom and to what
extent and subject to what -conditions, if any, such costs
are to be paid and to give all necessary directions for the
purposes aforesaid. The question is whether respondent No.
I had power, in the exercise of his discretion under the
provisions of sub-s. (7) of s. 11, to direct the payment of
costs in advance by one of the parties to the dispute to the
other parties in a pending proceeding, irrespective ‘of the
final result of that proceeding.
In our opinion, the question admits of only one answer.
Sub-section (3) of s. 11 enumerates certain powers vested in
a Civil Court under the Code of Civil Procedure, and says
that every Board, Court and Tribunal under the Act shall
have those powers; the last enumerated power is in general
terms, being respect of such other matters as may be
prescribed. No rules made under the Act bearing on the
question of costs have been brought to our notice; there re,
all that can be said, with regard to the effect of sub-s.
(3) of s. II, is that except the enumerated powers, other
powers vested in a Civil Court under the Code, of, Civil
Procedure have not been given to the Board,
225
Court or Tribunal under the Act. The Act however, contains
a separate provision in the matter of costs and that is sub-
s. (7) of s. 11. That sub-section reads (we are quoting it
as it stood at the relevant time prior to the amendment of
1956):
“ Subject to the rules made under this Act, the costs of,
and incidental to, any proceeding before a Tribunal shall be
in the discretion of that Tribunal, and the Tribunal shall
have full power to determine by and to whom and to what
extent and subject to what conditions, if any, such costs
are to be paid, and to give all necessary directions for the
purposes aforesaid, and such costs may, on application made
to it by the person entitled, be recovered as arrears of
land revenue or as a public demand by the appropriate
Government.”
A comparison of the sub-section with s. 35 of the Code of
Civil Procedure shows that the sub-section is in terms
similar to those of s. 35 of the Code of Civil Procedure
except for the’ concluding portion of the subsection which
relates to the recovery of costs as arrears of- land
revenue. There is also another difference in that sub-ss.
(2) and (3) of s. 35 of the Code of Civil Procedure do not
find place in the Act. On a plain reading of the sub-
section, it is manifest that (1) the expression ” costs of
any proceeding ” means costs of the entire proceeding as
determined on its conclusion and not costs in a pending
proceeding, nor costs to be incurred in future by a party;
and (2) the expression ” costs” incidental to any proceeding
” similarly means costs of interlocutory applications etc.-
such costs as have been determined thereon, at the
conclusion of the hearing. Neither of the two expressions
has any reference, to costs payable in advance or to be-
incurred in future by a party; far less do they refer to
halting and travelling allowances to be incurred by a party
while attending the Court on his own behalf. Respondent No.
1 correctly appreciated the legal position, and said I that
there was no provision of law in support of the claim made
by
29
226
the respondents. He relied, however, on the general
practice of Industrial Courts, particularly in Banks’ cases.
We doubt it there was any such general or consistent
practice; nor do we think that such practice, if any, is
legally justified. But we shall advert to this matter when
considering such of the decisions of Industrial Tribunals as
have been placed before us.
Learned counsel for the respondents has -not relied on
practice, but on the terms of the subsection. He has
submitted that the concluding portion of, the sub-; section
which states that ” such costs may, on application made to
it by the person entitled, be recovered as arrears of land
revenue or as a public demand by the appropriate Government
“ shows that costs may be granted in advance in a pending
proceeding. His, argument -has proceeded on these lines:
firstly, he has submitted that an Industrial Tribunal
becomes functus officio with the submission of the award.;
second the concluding portion of the. sub-section shows that
an application for recovery of costs can be made to it ”
that is, the Tribunal); therefore, the , application must be
made before the Tribunal becomes functus officio; that is,.
at a stage when the proceedings is still pending. In our
opinion, this argument is wholly fallacious and proceeds on
a misreading of the sub-section. The expression ” it “ in
the concluding portion of the sub-section refers to the
appropriate, Government. and not to the Tribunal; thus the
very basis of the argument disappears and it is unnecessary
to consider if the Tribunal becomes functus Officio with the
submission of its award-& proposition regarding which we-
express no opinion.
It is not disputed that sub-s. (7) of s. 11 of the Act gives
a discretion to the Tribunal, and it has full power to
determine by and, to whom and to what extent and subject to
what conditions, if any, the costs are to be paid. It is
clear, however, that the discretion is a jusicial discretion
and must be exercised according to the rules. of reason and
justice–not by chance or caprice or private opinion or some
fanciful
227
idea of benevolence or sympathy. It is a, negation of
justice and reason to direct the appellant to pay in advance
the costs of the respondents irrespective of the final
result of the proceeding. The general rule is that costs
follow the event unless the Court, for good reasons,
otherwise orders. Respondent No. I gave no reasons for his
order except that of practice—a practice, assuming there
be any such practice, which is neither legal nor just. It
may be conceded that the jurisdiction of an Industrial
Tribunal is not invoked for the enforcement of mere
contractual rights and liabilities of the parties to the
dispute referred to the Tribunal for adjudication; its
jurisdiction in the matter of adjudication of an industrial
dispute is wider and more flexible. All the same, it is not
an arbitrary jurisdiction; it may be readily conceded that
an employee is as much entitled to a fair deal as an
employer and he must be protected from victimisation and
unfair labour practice, but I social justice’ does not mean
that reason and fairness must always ‘yield to the
convenience of a party-convenience of the employee at the
cost of the employer as in this cases an adjudication
proceeding. Such one-sided or partial view is really next
of kin to caprice or humour. Lord Halsbury L. C. put the
matter in characteristically forceful language when, he
said: “…… ’discretion’ means when it is said that
something is to be done within the discretion of the
authorities that ,something is to be done according to the
rules of reason and justice, not according to private
opinion: Rooke’s Case (1); according to law, and not humour.
It is to be, not arbitrary, vague, and fanciful, but legal
and regular.” (Susannah Sharp v. Wakefield) (2).
There are special cases where in a pending proceeding some
costs may have to be borne by a party to a litigation; for
example, sub-r. (4) of r. 4 of 0. XXXII, Code of Civil
Procedure, says that where there is no other person fit and
willing to act as guardian of a minor for the suit, the
Court may appoint any of its officers to be such guardian,
and may. direct that the
(t) 5 Rep. 100,a.
(2) [1891] A.C. 173. 179.
228
costs to be incurred by such officer in the performance of
his duties as such guardian shall be borne either by the
parties or by any one or more of the parties to the -suit.
Section 35 of the Code is not only subject to such
conditions and limitations as may be prescribed, but is also
subject to the provisions of any law for the time being in
force. Under the Matrimonial Causes Rules, 1950, the
practice in English Courts is that after the registrar’s
certificate for trial has been granted, or, with leave, at
an earlier stage of ‘the cause, a wife who is a petitioner
and has asked for costs or who has filed an answer may apply
for security for her costs of the cause up to the hearing,
and of and incidental to the hearing (see Halsbury’s Laws of
England, 3rd Ed., Vol. 12, para. 765 at p. 358). When such
security is ordered, unless the husband elects to pay the
amount into the registry and gives notice to the wife’s
solicitor, a bond is required from him. Such cases stand on
a special footing and are governed by special statutory pro-
visions. They have no application in the present case and
afford no justification for the order impugned before us.
We now turn to the question of practice in the Labour
Courts. The earliest decision which has been brought to our
notice is Kirloskar Brothers Ltd. v. Their Workmen(1). That
was a case in which one of the demands for adjudication was
the demand for travelling and other expenses of the workers
representatives, when such representatives were required to
-go out at the instance, of any duly constituted authority
or Court in respect of any industrial matter. It was
observed: ” The demand according to the company amounted to
financing the administration of the Union and was therefore
objectionable even on psychological grounds.” The: Tribunal
directed that the; travelling and other expenses to be
incurred, in connection with the Union work must be paid out
of the Union funds and the employer–could not be required
to contribute the sum.
(1) [1951] 2 L.L.J. 557.
229
In the well-known case, Certain Banking Companies V. Their
Workmen (1), the question of facilities for effective
representation of their cases on behalf of the employees was
raised and considered at -some length. The decision given
was that the Tribunal had power and jurisdiction, under sub-
s. (7) of s. 11 of the Act, to direct the Banks to meet the
reasonable expenses of the workmen in a pending proceeding
in order to ensure a fair and effective hearing. The
grounds on which the decision was based were these: (1) the
Banks were well organised and their managements we’re -in.
possess-ion of resources; (2) the adjudication by a Iabour
Court or Industrial Tribunal was a compulsory adjudication
in the interests of the public, and as disputes relating to
Banking companies, with establishments, in more than one
State, were referred to the Tribunal by the Central
Government, the circumstance that various workmen residing
in various States were compelled to submit to an
adjudication by a. Central Tribunal was sufficient to
justify an order for the payment of their travelling and
halting allowances; (3) there was nothing in the Act. to
preclude the exercise, of such power on the part of the
Industrial Tribunal as was required to carry on the
fundamental object of ensuring a proper hearing for the two,
parties to the dispute, and the weaker party,, namely, the
comparatively unorganised, numerous and scattered workmen
employed in different branches, needed assistance to present
their case ; (4) prior to the addition of, sub-s. (7) of
s.11 in 1950, various Industrial Tribunals used to pass
similar orders and it was in recognition of the necessity of
such orders that the statutory provision in the sub-section
was made; and (5) the principles of natural justice.
required that a real opportunity should be given to the
workmen to. present their case by asking the employer to pay
for their expenses. In our opinion, not one of the
aforesaid grounds is really sustainable, either in law or on
the principle of justice, equity and good conscience., The
circumstance that the Banks are well organised and their
managements are in possession of
(1) [1952] 2 L.L.J. 54.
230
resources cannot be a ground for making -them pay for the
expenses of the other party; if that is the principle to be
applied, then in every case the richer party must be made to
pay the expenses of- the weaker party, irrespective of the
ultimate result of the dispute ; even in a dispute raised by
the workmen, which may be ultimately found to be -devoid of
all merit, the employer must be made to finance the workmen.
Such a principle will merely encourage frivolous and
unsubstantial disputes and will run counter to the object
and purposes of the Act, namely; the promotion of industrial
peace in the interests of the general public. The
second circumstance that the adjudication is a com-
pulsory adjudication applies equally to both parties.If it
is a compulsory -adjudication for the employees, it is
equally so 1 or the employer and we can see no reason why
that circumstance should involve the imposition of a penalty
on one of the parties to the dispute and not on the other.
We, have already pointed out that on a proper construction
of the sub-section there is no power in the Tribunal to
direct the Repayment of the costs of a party,, in advance by
the other party, irrespective of the final result, of the
proceeding, and the view expressed by the Bank Disputes
Tribunal as to the construction of the relevant sub-section
is manifestly erroneous; nor are we satisfied, that prior to
the addition of the sub-section, there was any consistent or
uniform practice in the matter, so as to lead to the
inference that the provisions of the sub-section gave
statutory recognition to; the practice.’ It is difficult to
understand how the principles of natural justice can be
invoked in aid of an order which penalises one party to a
dispute by making it pay for the costs of the other party in
advance, irrespective of the result of the proceding. We
can only say that such an order is neither natural nor has
any element of justice in it.
In a later decision, Asssociated Cement Companies
Ltd.,Dwarka Cement Works, Dwarka V. Workmen Employed under
it(1),it Was observed: “ It,therefore, the Unions
representatives thought it proper -to attend on the
(1) [l953] I.C.R. BOM. 292 at 307.-
231
various dates before, the Tribunal, it is the Union who
should bear the costs.” In a still later decision, Jeevan
Textile Mills, Hyderabad (Deccan) v. Their Workmen(1), the
question was again considered at some length. With regard
to sub-s. (7) of s. II it was observed: ” Although s. 11 (7)
is worded in a very wide way and the power to order the
payment of costs granted under it to industrial tribunals is
made comprehensive and is not even fettered by a provision
like s. 35 (2) of the Code of Civil Procedure, requiring the
tribunal to state its reasons if costs are not ordered to
follow the event, orders for costs can only be made, even by
industrial tribunals, on well-recognised principles and not
on any abstract ideas as to what, irrespective of such
principles, should be considered as desirable in any
particular case: vide United Commercial Bank Case(2)”. We
are in agreement with the view expressed above.
It would appear from what we have stated above that there
was no uniform or consistent practice in the matter, and we
are further of the view that if there was any such practice,
it was neither warranted by law nor by the principles of
reason and justice. In Ex parte Snow In re Sherwell(3), an
application was made to review a taxation of costs and the
appellant, who was a Barrister-at-law and resided at
Liverpool, claimed his travelling expenses from Liverpool to
London and back, on the ground that by arguing his own
appeal he had saved the expense of engaging counsel to which
he would have been entitled. The claim was dismissed as
“preposterous and unheard of
As we began, so we -end: there is only one answer to the
question and that answer is that respondent No. I had no
power, in the exercise of his discretion under sub-s. (7) of
section II of the Act, to direct the appellant in this -case
to pay the travelling and halting allowances of the
representatives of the Unions in a pending proceeding and
irrespective of its final
(1) [1956] 1 L.L.J. 423.
(2) [1952],2 L.L. J. 1.
(3) [1879] Weekly NoteS 22.
232
result. For the reasons given. this appeal is allowed with
costs, and the costs must be paid by the contesting
respondents. The order of respondent No. 1, so far as it
relates to the payment in a pending proceeding of travelling
and halting allowances to the representatives of the various
Unions, must and is hereby, set aside.
Appeal allowed.
233