ASSOCIATED CEMENT COMPANIES LTD. v. P. N. SHARMA AND ANOTHER
Citation: [1965] 2 S.C.R. 366; 1964 INSC 278
Court: Supreme Court of India
Bench: P.B. GAJENDRAGADKAR , M. HIDAYATULLAH, J.C. SHAH, S.M. SIKRI, R.S. BACHAWAT
Judgment date:
Case summary
1964 INSC 278. Supreme Court of India judgment dated 1964-12-09. ASSOCIATED CEMENT COMPANIES LTD. v. P. N. SHARMA AND ANOTHER. Read the judgment and case...
Judgment text
ASSOCIATED CEMENT COMPANIES LTD. v. P. N. SHARMA AND ANOTHER December 9, 1964 {P. B. GAJENDRAGADKAR, C. J. , M. HIDAYATULLAH, J. c. SHAH, S. M. SIKRI AND R. S. BACHAWAT, JJ. ) COflStilution of India, 1950, Art. 136(1)-Trlbunal-What 13-Faeto- ries Act {63 of 1948), s. 49{1) and (2) and Punjab Welfare Ofjiceri R~ crultment and Conditions of Service Rules, 1952, rr. 6(3), Proviso 2{S) and (6)-Scope of-R. 6(3) Proviso 2, if invalid. Tho appellant appointed the ht reopondent as a Welfare Officer u required by the Factories Act, 1948 and the Punjab Welfare Officers llo- cruitment and Conditions of Service Rules, 1952. The letter of appoint- ment stated that the ! st respondent was liable to be transferred from one unit of the appellant to another and that his services could be terminated • c by the appellant by one month'll notice or with one month's pay in lieu 0 thereof.
On the ht respondent being unprepared to go to a place to which he was transferred, the appellant terminated his services with one month's salary. The ! st respondent aj>pealed to the 2nd respondent, the State of Punjab, the appellate authonty under r. 6(6) and the 2nd res- pondent ordered his re1DStatement as the previous concurrence of the Labour Commissioner as required by r. 6(3), proviso 2, was not obtained. In appeal to the Supreme Court it was contended that : (i) the rule requiring the concurrence of the Labour Commissioner was invalid u it was outside the scope of the rule-malting authority conferred on the K State Government by s. 49(2) of the Act, and (ii) the order of reinstat&- ment passed by the 2nd respondent was invalid as the appeal by the ! st respondent to the 2nd respondent was incompetent. The !
st respondent also raised a preliminary objection that the appeal to the Supreme Court was incompetent because the 2nd respondent was not a tribunal within the meaning of Art. 136{1) of the Constitution. HELD : (i) The 2nd respondent is a tribunal within the meaning ot r Art. 136( I) having regard to the distinctive features of the power conf•- red on it by r. 6(5) and (6). (387 BJ (Per Gajendragadkar, C. J. , M. Hidayatullah, J. C. Shah and S. M. Sikri, JI. ) : In considering the questipn about the status of any body or authority as a tribunal under the article, the consideration about tho presence of all or some of the trappings of a court is really not decisive. The presence of some of the trappings may assist the determination of G the question as to whether the power exercised by the authority which possessed the said trappings, is the judicial power of the State or not.
The _main and basic test however, is whether the adjudicating power which a particular authority is empowered to exercise, bas been conferred on it by a statute and can be described as a part of the State's inherent power exercised in discharging its judicial function. Applying the test, there can be no doubt that the power which the 2nd respondent exercised under rr. 6(5) and (6) of the Rules is a part of the State's judicial power. It H bas been conferred on the 2nd respondent by a statutory rule 8J! d it can be exercised in respect of disputes between the management and its welfare officers. There is a li. r an affirmation by one party and denial by another, A B c D E . , G H A. c. c. LTD. 11. P. N. SHAllMA (Gajendragadkar, C. /. ) 367 and the dispute necessarily involves the rights and obligations of the parties to it. The order which the 2nd respondent ultimately passes is described as its decision and it is made final and binding. Besides, it is an order passed on appeal.
In reaching a fair and objective decision in the dispute brought before it iii its appellate jurisdiction, the State Government has the power to devise its own procedure and to exercise such other incidental and subsidiary powers as may be necessary to deal effectively with the dispute. [386 F-H; 387 A-B, E] Per Bachawat, 1. The basic test of a tribunal within the meaning of Art. 136, is that it is an adjudicating authority (other than a coun) vested with the judicial power of the State. In India, the State has inherent judicial powers or functions and the courts and other authorities vested by the State with judicial functions are regarded as delegates of the State judicial power. The courts alone have no monopoly of the judicial power. An authority other than a coun vested with the judicial power of the State in this sense is regarded 81 a tribunal under the article. The investi- ture of the trappings of a coun is not an essential attribute of a tribunal.
The plentitude of the residuary appellate power under Art. 136 embraces within its scope all adjudicating authorities vested with the judicial power of the State, whether or not such authorities have the trappings of a court. In order to be a tribunal, ii is essential that the power of adjudication must be derived from a statute or a statutory rule. The appellate function and the power of conclusive determination of the civil rights of the parties with regard to the matters in controversy between them indicate that the 2nd respondent is under a duty to act judicially and to decide the dispute aolely by ascertaining the facts on the materials before it and by the appli- cation of the relevant law on the point. As the rule does not prescribe any procedure for the hearing of the appeal the 2nd respondent may de\ise it> own procedure consistently with its judicial duty. [392 D-F; 393 E, H; 394 A. C, D-E; 396 C-E] Case law reviewed. (ii) (Per Gajendragadkar, C. J. , M. Hidayatullah, J. C.
Shah and S. M. Sikri, JJ. ) : Tue w<>rds "conditions <>f service" used in s. 49(2) are wide enough to cover the provis<> (2) tor. 6(3). CC>nditi<>ns of service would take in the termination of services and incidentally, the conditions subject to which such terminati<>n could be brought about. A statut<>ry rule impooing the obligati<>n on the management, prescribed by the 2nd proviso to r. 6(3) would fall within s. 49(2) of the Act and therefore, the rule ie not invalid. [388 C-E, G] (iii) (By Full CC>urt) : The appeal preferred by the 1st respondent to 2nd respondent is incompetent. [389 H; 397 B-CJ Tue scheme of the reievant rules is that if the management applies for the concurrence of the Labour CC>mmissioner and the concurrence is not given by him, the management can appeal under r. 6(5). If the concur- rence is given, or if a welfare officer's services are terminated without applying for concurrence, be. may appeal under r.
6(6);, bu~ before such an appeal can be competent 11 must appear that the term10a11on of semce wu 1n the nature of a punitive action. The termination in the instant case was no more than a discharge in terms of the conditions of . service. It ill not a punishment and so is outside r. 6(3) altogether. It 1s true that the form in which the order has been passed will not necessarily determine the character of the termination. The order of discharge in the instant case was a bona/id• order of discharge, and the employer passed the order, because it was not its intention to cast any slur upon the employee, even though it thought it necessary to terminate his services. [388 H; 389 A-B, H; 390 c. Fl 368 SUPREME COURT REPORTS· [1965] 2 S. C. R. CIVIL APPELLATE JURISDICTION : Civil Appeal No. 44 of A 1964. Appeal by special leave from the order dated July.
4, 1962, of the Government of Punjab (Labour Department) in exercise of the powers conferred by sub-rule 6 of the Punjab Welfare Officers (Recruitment and Service Conditions) Rules, 1952. M. C. Seta/vad, J. B. Dadachanji, 0. C. Mathur and Ravinder Narain, for the appellants. J. P. Goyal, for respondent No. I. Gopa/ Singh and R. N. Sachthey, for respondent No. 2. B The Judgment of GAJENDRAGADKAR C. J. , M. HIDAYATULLAH, C SHAH and SIKRI JJ. · was delivered by GAJENDRAGADKAR C. J. BACHA \VAT J. delivered a separate Opinion. Gajendragadkar, C. J. The principal point of law which arises in this appeal by special leave is whether respondent No. 2, the State of Punjab, exercising its appellate jurisdiction under Rule D 6(6) of the Punjab Welfare Officers Recruitment and Conditions of Service Rules, 1952 (hereinafter called 'the Rules') is a Tribunal within the meaning of Art. 136(1) of the Constitution. The appel- lant, the Associated Cement Companies Ltd. , Bhupendra Cement Works, .
Surajpur, challenges the validity of the appellate order passed by respondent No. 2 on July 4, 1962 under the provision F.. : of the said Rule, directing the appellant to reinstate its Welfare Officer, P. N. Sharma-respondent No. 1. At the hearing of this appeal, a preliminary objection has been raised by Mr. Goyal on behalf of respondent No. 1 that special leave should not have beeri granted to the appellant, because the appeal is incompetent inas- F much as respondent No. 2 against whose appellate decision the appellant purports to have preferred the present appeal is not a tribunal under Art. 136(1). If the preliminary objection fails, then it would become necessary to consider the appellant's con- tention that the impugned appellate order is invalid and erroneous and must be set aside. The appellant is a company with its Head Office in Bombay and it runs 14 cement factories, 2 collieries and one fire-brick works in 8 States of the Union of India.
One such Cement Works G is the Bhupendra Cement Works, Surajpur within the territorial limits of respondent No. 2. Under the provisions of the Factories Act, 1948 (No. 63 of 1948) (hereinafter called the Act) read H with the provisions of the Rules, the appellant was required to appoint one Welfare Officer and to notify his appointment and A. C. C, LTD. v. P. N. SHARMA (Gajendragadkar, C. J. ) 369 A qualification to the Chief Inspector of Factories. Respondent No. 1 was appointed such a Welfare Officer. The letter of appoint- ment issued to him on March 2, 1956, stated that he would be liable to be transferred from one unit of the appellant to another and that his services could be terminated by the appellant by one month's notice or with one month's pay in lieu thereof. Respon- B dent No. 1 was first posted at Lakheri Cement Works, Lakheri in Rajasthan, where he joined duty on March 14, 1956.
Thereafter, he was transferred from one place to another according to the requirements of service and the working of the appellant's fac- tories. On June 26, 1960, he was posted at the Bhupendra Cemeμt Works. He was working at these Works until September 26, C 1961, when his services were terminated. It appears that the ap- pellant transferred respondent No. I from Bhupendra Cement Works to Kymore Works which is near Katni in Madhya Pradesh, but apparently, respondent No. 1 was not prepared to go to Kymore Works, and after long and protracted correspondence between the 0 parties, the appellant wrote to him on September 26, 1961, that since he had not proceeded to Kymore on transfer as directed, he had ceased to be in the employment of the appellant, and his name had been struck off from the Company's roll. Respondent No. 1 then filed an appeal before respondent No. 2 as the appellate authority under. R. 6(6) of the Rules.
On receiving E notice of the said appeal, the appellant filed its written statement and disputed the validity of the grievance made by respondent No. 1 in respect of the termination of his services. Respondent No. 2 then passed the impugned order on July 4, 1962. This order was issued in the name of the Governor Qf Punjab in exercise of the powers conferred by R. 6(6) of the R~les, and it directed that the F Governor of Punjab was pleased to reinstate respondent No. 1 as Labour Welfare Officer in the service of the appellant. "However", says the order, "nothing in this order shall be construed to prevent the management from taking action against Mr. P. N. Sharma in accordance with the provisions of the Rules for snch acts and G commissions on his part as may have come to their notice". lt is the validity of this order which is challenged before us by the appellant.
Before proceeding to deal with the preliminary objection, we may conveniently refer to the relevant provisions of the Act and the Rules. The Act has been passed in 1948 with the object of H consolidating and amending the law regulating labour in factories. Consistently with this object and policy, the Act has made several beneficient provisions in the interests of industrial labour employed 370 SUPREME COURT REPORTS [1965] 2 S. C. ll. in factories to which the Act applies. Section 49 deals with the A appointment of Welfare Officers. S. 49(1) provides that in every factory wherein five hundred or more workers arc ordinarily em- . ployed, the occupier shall employ in the factory such number of welfare officers as may be prescribed. It is common ground that the appellant falls within thi; scope of s. 49(1}, and so, it has been appointing welfare officers in its factories; in fact, respondent No.
1 B was one of such Welfare Officers appointed by the appellant Section 49(2) provides that the State Government may prescribe the duties, qualifications and conditions of serviee of officers em- ployed under sub-section (1 ). It is )>y. virtue of the powers con- ferred on the State Government that respondent No. 2 has framed C the Rules. The Rules were framed by respondent No. 2 in 1952 and have 'been published in the Punjab Government Gazette on March 26, 1952, and they came into force from September 30, 1952. Rule 4 prescribes the qualifications for the appointment of a Welfare D Officer. R. 5 provides for the procedure which has to be followed in appointing Welfare Officers. R. 6 prescribes conditions of ser- vice of Welfare Officers and R. 7 prescribes their duties. R.
8 confers power on the State Government to exempt any factory or class or description of factories from the operation of all or any of these Rules, subject to compliance with such alternative E arrangement as may be approved. In the present appeal, we are concerned with R. 6. Rule 6 reads thus :- "(l) A Welfare Officer shall be given appropriate status com:sponding to the status of the other executive heads of the factory. F (2) The conditions of service of a Welfare Officer shall be the same as of other members of the Staff of " F pellant with a specific charge, it was a nullity. In dealing with the appellant's contention that the watch committee had to act judicially, Lord Reid has exhaustively considered the judiciel de- cisions bearing on this point. He referred in particular to the following observation made by Atkin L. J. in Rex v. Electricity Commissioners, Exparte London Electricity, Joint Committee Co. G ( 1920) Ltd.
& Others( 1 ) : ''Wherever any body of pers~ns having legal authority to determine questions affecting the rights of sub- jects, and having the duty to act judicially, act in excess of their legal authority, they are subject to the controlling jurisdiction of the King's Bench Division exercised in these writs. " This obser- vation was later read by Lord Hewart, C. J. in Rex v. Legislative H Committee of the Church Assembly, Exparte Havnes Smith('), as meaning that before the decision of any authority could be sub- (I) [192411 K. B. D. 171, 205. (2) [192811 K. B. D. 411. L3Sup. /65-8 376 SUPRBMB COUi. T llBPORTS [1965] 2 S. C. R. jected to the writ jurisdiction, it must appear that the said btJdy A ' should have legal authority to detetmine questions affecting the rights of subjects and should further be required to act judicially. The duty to act judicialiy, observed Lord Hewart, C. J. , is an ingredient which, if the test is to be satisfied, must be present.
The Privy Council in Nakkuda Ali v. Jayaratne('), had taken B the same view. Dealing with the order passed by the Controller of Textiles in Ceylon under a Defence Regulation which em- powered him to cancel a licence "where the controller has reason- able grounds to believe that :my dealer is unfit to be allowed to continue as a dealer," the Privy Council held that it did not follow from the words of the relevant Defence Regulation that the con- C troller must be acting judicially in exercising the power. It is a long step, said the Privy Council, in the argument to say that because a man is enjoined that he must not take action unless he has reasonable ground for believing something he can only arrive at that belief by a course of conduct analogous to the judicial pro- D cess. And yet, unless that proposition is valid, there is really no ground for holding that the controller is acting judicially or quasi- judicially when he acts under this regulation.
If he is not under a duty so to act, then it would not be according to law that his deci- sion should be amenable to review and, if necessary, to avoidance by the procedure of certiorari. E Having set out these decisions, Lord Reid expressed his dis- sent from the gloss which has been put by Lord Hewart C. J. in Rex v. Legislative Committee of the Church Assembly(') on the observations of Atkin, L. J. in Rex v. Electricity Com- missioners('), and the view taken by the Privy Council in F Nakkuda Ali('); and he held that "the power of dismissal confer- red on the watch committee bys. 191(4) could not have been exer- cised and cannot now be exercised until the watch committee have informed the constable of the grounds on which they propose to proceed and have given him a proper opportunity to present his case in defence. " (p. 79).
In other words, according to Lord G Reid's judgment, the necessity to follow judicial procedure and observe the principles of natural justice, flows from the nature of the decision which the watch committee had been authorised to reach under s. 191(4). It would thus ·be seen that the area where the principles of natural justice have to be followed and judicial approach has to be adopted, has become wider and consequently, H (I} [1951] A. C.. 66, 77. (.! ) [1928] I K. B. D. 411 (3) (1924} 1 K. B. D. 411. A. C. C. LTD. v. P, N. SHARMA (Gajendragadkar, C. 1. ) 377 A the horizon of the writ jurisdiction has been extended in a corres- ponding measure. In dealing with questions as to whether any impugned orders could be revised under Art. 226 of our Consti- tution, the test prescribed by Lord Reid in this judgment may afford· considerable assistance. B In Nagendra Nath Bora & Another v. The Commissioner of Hills Division and Appeals, Assam, & Ors.
(') this Court had to consider whether the jurisdiction of the High Court under Arts. 226 and 227 of the Constitution could be invoked against the decision of the appellate authority constituted under the Eastern Bengal and Assam Excise Act, 1910 (E. B. & Assam Act I of C 1910). The scheme of the Act was examined and it was noticed that the Act had laid down a regular hierarchy of authorities, one above the other, with the right of hearing appeals or revisions. It is true that there was no provision in the Act which required, in express terms, that reasoned orders should be recorded; but in the context of the subject-matter of the rules, it was held that it D was the duty of the appellate authority to hear judicially, that is to say, in an objective manner, impartially and after giving rea- sonable opportunity to the parties concerned in the dispute, to place their respective cases before it. (p. 1254).
On that view of the matter, the decision of the appellate authority was theoretically held to be subject to the jurisdiction of the High Court under Art. E 226 to issue a writ of certiorari. In Shivji Nathubhai v. The Union of India & Others('), this Court held that in exercising its power of review under rule 54 of the Mineral Concessions Rules, 1949, the Central Government acted judicially and not administratively. In consequence, the de- F cision of the Central Government was liable to be questioned on proper grounds under Art. 226 of the Constitution. The question as to whether the State Government in granting the mining lease acted merely administratively or not, was not considered in this case, because it was enough for the purpose of deciding the appeal that the powers of review were not administrative powers and G exercise of the said powers would be subject to examination by the High Courts under Art. 226.
It will be noticed that in these cases, this Court was not called upon to consider whether the authorities whose decisions were challenged under Art. 226 were tribunals or not, be ca use the H requirement that the impugned decision should be that of a tri- bunal which has been prescribed by Art. 136(1) is not to be found (I) [19S8] S. C. R. 1240. (2) (1960] 2 S. C. R. 775. 378 SUPllBMS COUR. T llEPOllTS (1965) 2 S. C. R. in Art. 226; and so, the only point which fell for decision was A whether the impugned orders amounted to judicial or quasi-judi- cial decisions liable to be corrected by the issue of a writ of cer- tiorari under Art . 226, or not. That problem is different from the one which we have to decide in the present case. Let us now refer to some of the decisions which deal with the B problem with which we are concerned. The . first decision where this question was elaborately ·considered was pronounced in the case of The Bharat Bank Ltd. , Delhi, v.
Employees of the Bharat Bank Ltd . , and the Bharat Bank Employees' Union, Delhi(1). In that case, an award pronounced by an Industrial Tribunal . under the provisions of the Industrial Disputes Act, 1947, was brought c to this Court in appeal by special leave under Art . 136(1), and the respondents' preliminary objection that the appeal was in- 1 competent, raised the problem as to whether the Industrial Tri- bunal was a tribunal under Art. 136(1) or not. The majority de- cision was in favour of the view that the Industriai Tribunal is a tribunal within. the meaning of Art . 136(1). Mahajan J. , who D delivered the principal judgment in support of the majority view on this point, held that "industrial tribunals though they are not full-fledged Courts, yet exercise quasi-judicial functions and are v. ithin the ambit of the word 'tribunal' in Art. 136 of the Con- stitution. ". (p. 476). "The condition. precedent," said Mahajan I .. "for bringing a tribunal within the"'itmbit of Art.
136 is that it I: should be constituted by the State. Again, a tribunal would be outside the ambit of Art. 136 if it is not invested with any part of the judicial functions of the State but discharges purely admini. 9-- trative or executive duties (p. 478). " It is in this connection that the learned Judge added that tribunals, however, which are found invested with certain functions of a court of justice and have some F of its trappings also would fall within the ambit of Art. 136, be- cause, according to the learned Judge, the intention of the Consti- tution by the use of the word "tribunal" in the article seems to have been to include within the scope of Art . 136 tribunals adorned with similar trappings as Court but strictly not coming within that G definition (p. 474). The fact that awards pronounced by Indus- trial Tribunals become enforceable under s. 17A subject to the conditions therein prescribed, did not make any difference to the legal position that the lndl.
lStrial Tribunals were tribunals within the meaning of Art. 136(1). The majority decision in the case of the Bharat Bank( 1 ), to H which we have just referred was adopted unanimously by this Court c•> (t9SOJ s. c. R. 459. A. C. c. LTD. v. P. N. SHARMA (Gajendragadkar, C. I. ) 379 A in. the case of Durga Shankar Mehta('). Speaking for the Court, Mukherjea, J. , observed that it was now well-settled by the majority decision of the Court in the case of Bharat Bank(') that the expres- sion ''Tribunal" as used in Art. 136 does not mean the same thing as "Court" but includes, within its ambit, all adjudicating bodies, provided they are constituted by the State and are invested B with judicial as distinguished from purely administrative or executive functions, subject, of course, to the exception specifically provided for by Art. 13 6 ( 2) . In M/s. Harinagar Sugar Mills Ltd. v.
Shyam Sundar Jhunj- hunwala and Others("), the question which arose for decision of c this Court was whether the Central Government, while it exercises its appellate power under s. 111 (3) of the Companies Act, 1956 (No. I of 1956), was a tribunal within the meaning of Art. 136(1). In considering this question, the scheme of the relevant provisi. Jns of the Act was examined, the earlier decisions bearing on tho point were taken into account and it was held that s. 111(3) required D that the Central Government, while acting as an appellate authority, had to act judicially and was entrusted with the judicial powers of the State to adjudicate upon rights of the parties in civil matters when there is a lis between the contesting parties, and so, the con- clusion was inevitable that it acts as a tribunal and not as an executive body. In that connection, Shah J .
, who spoke for the E majority of the Court, observed that the proceedings before the Central Government have all the trappings of a judicial tribunal; and by way of illustration, he referred to the fact that pleadings had to be filed, evidence had to be led, and the disputes had to be decided according to law after considering the representations F made by the parties. Hidayatullah J . , differed from the majority decision on the ques- tion as to the final order which should be passed in the said appeals. He held that there was no reason for the Central Government to have passed the impugned order, and so, he wanted the appeals to be allowed. Accordingly, he directed that the impugned order G should be set aside and appeals should be allowed with costs. On the preliminary question as to whether the appeals were competent, the learned Judge agreed with the majority decision that the Cen- tral Government was a tribunal within the meaning of Art. 136(1). Construing Art.
136(1), the learned Judge observed that courts and tribunals act judicially in both senses which he had earlier di&- H cussed, and in the term "Court" are included the ordinary and (I) [19551 I S. C. R: 257. (2) [1950] S. C. R. 459. (3) (1962] l S. C. R: 339, 352. 380 SUPREME COUllT REPOR. TS [1965) 2 S. C. R. . permanent tribunals and in the term "tribunal" are included all A others, which are not so included. Among the powers of the State, said Hidayatullah J. , is included the power to decide ·con- troversies between parties. This is undoubtedly one of the attributes of the State, and is aptly called the judicial power of the State. Broadly speaking, certain special matters go before tribunals, and the residue goes before the ordinary Courts of Civil Judicature. B Their procedures may differ, but the functions are not essentially different (pp. 362-63).
Thus, it would be noticed that all the learned Judges who heard this case~ were agreed in taking the view that the essential power wliich was exercised by the courts and tribunals alike was the judicial power of the State. In Jaswant Sugar Mills Ltd. , Meerut v. Lakshmichand and Others( 1 ), this Court has held that the Conciliation Officer acting under clause 29 of the Order promulgated in 1954 under the U. P. Industrial Disputes Act, 1947, has to act judicially in grant- c ing ·or refusing permission to alter the terms of employment of workmen at the instance of the employer, but even so, he was not a D tribunal, because he was not invested with the judicial power of the State, as he was empowered merely to lift the ban statutorily imposed on the employer's rights, and was not authorised to pronounce a final and binding decision in any dispute. That is why an appeal preferred against the order of the said Conciliation 'Officer was held to be incompetent under Art. 136(1).
"The con- E dition precedent for bringing a tribunal within the ambit of Art. 136," observed Shah J. , who spoke for the Court, "is that it should be constituted by the State;" and he added that a tribunal would be outside the ambit of Art. 136 if. it is not invested with any part of the judicial functions of the State but discharges purely admin~ F trative or executive duties. After examining the scheme of the relevant provision, it was observed that "in deciding whether an authority required to act judicially when dealing with matters affecting rights of citizens may be regarded as a tribunal, though not a Court, the principal incident is the investiture of the 'trap- pings of a court'-such as authority to determine matters in cases G initiated by parties, sitting in public, power to compel attendance of witnesses and to examine them on oath, and others ....
Some, though not necessarily all such trappings will ordinarily make the authority which is under a duty to act judicially, a 'tribunal'. " In the E. ngineering Mazdoor Sabha representing Workmen em- ployed under the Hind Cycles Ltd. & Anr. v. The Hind Cycle! H Ltd. , Bombay( 2 ), the question which arose for decision of thi~ (1) [1963) Supp. I S. C. R. 242, 259-60. (2) {1963] Supp. I S. C. R.. 625. A. C. C. LTD. v. P. N. SHARMA (Gajendragadkar, C. I. ) 381 A Court was whether an arbitrator appointed under s. 1 OA of the Industrial Disputes Act, 1947 (No. 14 of 1947) can be said to be a tribunal under Art. 136(1), and in rendering the answer to this question in the negative, this Court observed that apart from the importance of the trappings of a Court, the basic and essential condition which makes an authority or a body a tribunal under B Art. 136, is that it should be constituted by the State and should be invested with the State's inherent judicial power.
Even so, the judgment has referred to the trappings of a Court and it has been observed that sometimes a rough and ready test is applied in deter- mining the status of an adjudicating body by enquiring whether c the said body or authority is clothed with the travpings of a court. In that connection, it was added that the presence of the said trappings does not necessarily make the Tribunal a Court. The Arbitrator appointed under s. 1 OA was, however, held to be not a tribunal, because his appointment was essentially based on the agreement of the parties concerned and as such, his position was D somewhat analogous to that of the arbitrator appointed by the parties. Jn Inda-China Steam Navigation Co. Ltd. v. lasjit Singh Addi. Collector of Customs, Calcutta and Ors. , ( 1 ) the status of the Cen- tral Board of Revenue exercising its appellate power under s. 190 of the Sea Customs Act, 1878 and that of the Central Government E exercising its power under s. 191 came to be examined.
It waa common ground that the Customs Officer exercising his authority under s. 167 of the said Act was not a 'Court' or a 'Tribunal'; nevertheless, it as held that the Central Board of Revenue and the Central Government exercising their respective powers under ss. F 190 and 191 were 'tribunals' under Art. 136(1). This conclusion p:oceeded on the main ground that both the appellate and the revisiona! authorities in question are invested with the judicial power of the State and are required to act judicially. On this occasion, again, this Court referred to the trappings of a Court and observed that the presence of some of the trappings of a Court G may assist to determine whether the proceedings before the autho- rity in question are judicial or not, though it was emphasised that apart from the said test of trappings, the basic test was whether the authority in question had been. constituted by the State and had been given a part of the State's inherent judicial powers.
It would thus be seen that in dealing with the question as to H whether respondent No. 2, while it exercises its appellate power under Rule 6(6), is a tribunal under Art. 136(1), we must enquire (I) [1964] 6 S. C. R. 594. 382 · SUPllEME COUllT llEPOkTS [1965) 2 S. C. R. whether respondent No. 2 has been clothed with the State's inherent A judicial power to deal with disputes between parties and determine them on the merits fairly apd objectively. That is the test which has been consistently applied by this Court in considering the question about the status of any body or authority as a tribunal under Art. 136(1). Before we proceed to apply this "test to res- pondent No. 2's status under R. 6( 6), we think it is necessary to B advert to one aspect of the matter which sometimes creates some confusion.
We h~ve referred to the three essential attributes of a sovereign State and indicated that one of these attributes is the legislative power and legislative function of the State, and we have also seen C that in determining the status of an authority dealing with dis- put~ . • we-have to enquire whether the power conferred on the said authority or body can be said to be judicial power conferred on it by the State by means of a statute or statutory rule. The use of the expression "judicial power" in this context proceeds on the D well-recognised concept of political science that along with legis- lative and executive powers, judicial power vests in a sovereign State. In C the tribunal, the decisive test being that judicial power under the ,. Australian Constitution can be conferred only on courts and not on tribunals. When we refer to tribunals in dealing with the pro- blem posed by Art.
136(1), it is necessary to bear in mind the con- text in which Lord Sankey referred to these trappings. D There is another point to which we would like to refer before we part with this topic. In the Attorney-General for Australia v. The Queen and the Boilermakers' Society of Australia and Others(') an interesting question arose for the decision of the Court under ss. 29(l)(b) & (c) and 29-A of the Commonwealth Conciliation and Arbitration Act, 1904-1952. These provisions E purported to vest judicial power-even to the extent of fining a citizen or depriving him of his liberty-in the Court of Conciliation and Arbitration established under the Act with powers of an administrative, arbitral and executive character. It was held that the said provisions were invalid, because the function of an industrial arbitrator is completely outside the realms of judicial F power and is of a different character.
This decision also is based on the doctrine of rigid and strict separation of powers on which the Australian Constitution is based. Viscount Simonds, who delivered the judgment of their Lordships, has referred to the structure of the Australian Constitution and observed that in the matter of conferring judicial powers, it was G not open to the Parliament to tum from Chapter III to some other source of power (p. 313). Indeed, he cited with approval the observations made by Griffith, C. J. in Waterside Workers' •Federation of Australia v. Alexander (l. W. ) Ltd. ,(') that it is impossible under the Constitution to confer such functions (i. e. , judicial functions) upon any body other than a court, nor can the difficulty be avoided by designating a body, which is not in its (I} [19S7] A. C. 288. (2) [1918] 2S C. L. R. punish him, but to pass a simple order of discharge.
In such cases, it is no doubt open to the Court to consider the substance of the matter and not to treat the form in which the order terminating the services of an em- ployee has been passed, conclusive. But cases may occur in which it would be safe to conclude that the order of discharge is a f bona fide order of discharge and that the employer passed such an order, because it was not its intention to cast any slur on its employee, even though it thought it · necessary to terminate his se. rvices. In our opinion, the present case falls under this category. Therefore, we are not impressed by the ,argument that tl! e impugned order amounts to a termination of service in any other manner G contemplated by Rule 6(3} (v}. The result is, the appeal is allowed, and the imuugned order passed by responde:l' No. 2 is set aside on the grounJ that it has been passed without j:. :risdiction. Parties to bear their own costs. Bachawat, J.
-I agree with th~ conclusions of the learned Chief Justice and the order proposed by him, and will add a few words of my own. The preliminary objection as to the maintainability H A. C. C. LTD. v. P. N. SHARMA (Bachawat, !. ) 391 A of the appeal raises important questions of interpretation of Art. 136 of the Constitution. In what sense did the Constitution· makers use the word "tribunal" in that Article ? By what sign or distinctive attribute are we to recognise a tribunal ? ! Ii Royal Acquarium & Summer & Winter-Garden Society Ltd. v. Parkinson ('), Fry, L. J. said that this word has not, like the word B 'court' an ascertainable meaning in English law. The word cannot have the popular meaning of a Court of justice, for obviously a tribunal contemplated by Art. 136 is an authority other than a regular Court of justice. I think that the context of Art. 136 sup· plies the proper meaning of this word.
Article 136 concerns the C regulation of the judicial power of the State vested in the Courts and other authorities. The great purpose of Art. 136 is the recognition of the basic principle that one Court having supreme judicial power in the Republic will have appellate power over all Courts and adjudicating authorities vested with the judicial powers of the Stati~ throughout the territory of India barring those consti- D luted by or under any law relating to the Armed Forces. In this background, the basic test of a tribunal within the meaning of Art. 136 is that it is an adjudicating authority (other than a Court) vested with the judicial powers of the State. I think that all the decided cases substantially lay down this test. Speaking on behalf of a unanimous Court in Durga Shankar Mehta v. Thakur E Raghuraj Singh and others( 2 ), B. K. Mukherjea, J. said : F "It is now well settled by the majority decision of this Court in the case of Bharat Bank Ltd. v.
Employees of the Bharat Bank Ltd. (') that the expression 'Tribunal' as used in article 136 does not mean the same thing as 'Court' but includes, within its ambit, all adjudicating bodies, provided they are constituted by the State and are invested with judicial as distinguished from purely administrative or executive functions. " According to this test, the adjudicating body must be constituted G by the State and be vested with judicial functions. In other decided cases, other learned Judges conveyed the same idea in a somewhat different form; they have said that in order to be a tribunal, the body must be "invested with .... part of the judicial functions of the State", "delegates of the judicial power of the State", "invested with the State's inherent judicial powers", "exer- H cise judicial powers of the State. " (I) [1892] l C. B. 431, 446. (2) [1955] S. C. R. 267, 272. (3) [1950] S. C. R. 459. L3Sup. /6S-9 392 SUPRBMB COURT llBPORTS [1965] 2 S. C. R.
Now, the expression "judicial power of the State" is not to be A found in our Constitution. We have borrowed this expression from the Australian law. By Art. 71 of i the Australian Constitu- tion, "the judicial power of the Commonwealth" is vested in the Courts therein mentioned, and no other body or tribunal can exercise that power. The Australian bases try to soften the ll rigour of this prohibition by giving a somewhat narrow construction to the expression "judicial power of the Commonwealth". Thus, they hold that an arbitral power in relation to industrial disputes to ascertain and declare what in the opinion of the arbitrator are to be the respective rights and liabilities of the parties in relation to each other is not to be regarded as a jucpcial power of the Com- c monwealth within Art. 71 of the Australian Constitution. See Waterside Workers Federation v. Alexander('), Attorney-General of Australia v. Reginam( 2 ).
But our case law does not use the expression "judicial power of the State" in the same narrow sense while giving the test of a tribunal under 1 Art. 136 of the Consti- tution. Thus, the case of Bharat Bank Ltd. v. Employees of the n Bharat Bank Ltd. (") decided that an industrial tribunal is vested with the judicial functions of the State and is thus a tribunal within Art. 136. In our Country, the State (using that expression in the comprehensive sense of the Union and its component States) has inherent judicial powers or functions and the Courts and other authorities vested by State with judicial functions are regarded as E delegates of the State judicial powers. Unlike Australia, in our country the judicial power of the State 'may be vested not only in Courts but also in other authorities. The Courts alone have no monopoly of this judicial power. An authority other than a Court v~ted with the judicial power of the State in this sense is regarded as a tribunal within Art. 136.
, F In Shell Co. of Australia v. Federal Commissioner of Taxa- tion(') (a case coming from Australia), 'Lord. Sankey, L. C. said that "there are tribunals with many of the trappings of a court which, nevertheless, are not courts in thel strict sense of exercising judicial power. " The Lord Chancellor, was obviously pointing out G that a tribunal possessing one or more of the trappings of a Court was not necessarily a Court exercising the judicial power of the Commonwealth as contemplated by Art. 71 of the Australian Con- stitution. But it does not follow that the investiture of some or many of the trappings of a Court is an essential attribute of a tribunal con\emplated by Art. 136. Nevertheless, our concept H (I) (1918] 25 C. L. R. 434, 463. <fl (1957] 2 All. B. R. 45,50 P. C. (3) (1950] S. C. R. 459. (4) (1931] A. C. 275, 296. A. C. C. LTD. v. P. N. SHARMA (Bachawat, I. ) 393 A of a tribunal has been somehow coloured by Lord Sankey's idea of a tribunal with the trappings of a Court.
In Bharat Bank Ltd. v. Employees of Bharat Bank Ltd('), Mahajan, J. said that Art. 136 includes within its scope "tribunals adorned with similar trappings as Court but strictly not coming within that definition. " In Jaswant Sugar Mills Ltd. , Meerut v. Lakshmichand( 2 ), Shah, J. B said that in deciding whether an authority may be regarded as a tri- bunal, though not a Court, "the principal incident is the investiture of the 'trappings of a court'. " In Engineering Mazdoor Sabha v. Hind Cycles Ltd. , Bombay('), Gajendragadkar, J. (as he then was) said that in determining "whether a particular body or authority is a tribunal or not, sometimes a rough and ready test is applied C by enquiring whether the said body or authority is clothed with the trappings of a court", but he added that "apart from the trappings of a Court, the basic and essential condition which makes an authority or a body a tribunal under Art.
136, is that it should be constituted by the State and should be invested with the State's 0 inherent judicial power. " Similar observations were made by the same learned Judge in Indo-China Steam Navigation Co. v. Jasjit Singh('). In trying to find out whether a body is a tribunal within the meaning of Art. 136, it is natural to consider whether the body has some of the trappings of the Court. If it has one or more of such trappings, it may be easier to pronounce the body to E be a tribunal. But we must not forget that the investiture of the trappings of a Court is not an essential attribute of a tribunal. The basic test of a tribunal is that it is a body vested with the judicial power of the State. Unless this basic concept is borne in mind, the trappings of a Court may well become a trap and a snare for the unwary. F The limitations as also the full amplitude of the meaning of the word "tribunal" are thus to be found on a consideration of Art.
136 in all its parts, with such aid as may be derived from other Articles of the Constitution. The context of Art. 136 and the constitutional background impose the limitation that the tri- bunal must be an adjudicating authority vested with the judicial G power of the State. Barring this limitation, the word must receive a wide and liberal construction. The basic principle of Art. 136 is that if a litigant feels that injustice has been done by a Court or any other body charged with the administration of justice, there is one superior Court he may always approach and which, in its discretion, may give him special leave to appeal so that justice may H be done. The plenitude of the residuary appellate power under (! ) [19501S. C. R. 459. (2) (1963] Supp. 1 S. C. R. 242, 260. (3) [1963] Supp. I S. C. R. 625 al 631,633,641. (4) [1964] 6 S. C. R. 594. 394 SUPREME COURT REPORTS [f965] 2 S. C. R, ! Art.
136 embraces within its scope all adjudicating authorities A vested with the judicial power of the State, whether or not such authorities have the trappings of a Court. An authority other than a Court ma~ be vested by statute with judicial power in widely different circumstances, which it would be impossible and indeed inadvisable to attempt to define ex- B haustively. The proper thing is to examine each case as it arises, and to ascertain whether the powers ve~ted in the authority can be truly described as judicial functions or judicial powers of the State. For the purpose of this case, it is sufficient to say that any outside authority empowered by the State to determine conclusively the rights of two or more contending parties with regard to any C matter in controversy between them satisfies the test of an authority vested with the judicial powers of the Stbte and may be regarded l as a tribunal within the meaning of .! \rt. 13 6.
Such a power of adjudication implies that the authority must act judicially and must determine the dispute by ascertainment of the relevant facts on the materials before it and by applicatjon of the relevant Jaw to D those facts. This test of a tribunal is not meant to be exhaustive, and it may be that othe:r bodies not satisfying this test are also tribunals. In order to be a tribunal, it is essential that the power of adjudication must be derived from a statute or a statutory rule. An authority or body deriving it~ power of adjudication E from an agreement of the parties, such as a private arbitrator or a tribunal acting under s. 10-A of the Industrial Disputes Act, 1947, does not satisfy the test of a tribunal within Art. 136. It matters little that such a body or authority is vested with the trap- pings of a Court. The Arbitration Act, '1940 vests an arbitrator with some of the trappings of a Court, so also the Industrial Dis- F pules Act, 1947 vests an authority acting under s.
10-A of the Act with many of such trappings, and yet, such bodies and authorities are not tribunals. I The word "tribunal" finds place in Art. 227 of the Constitu- tion also, and I think that there also the word has the same mean- ing as in Art. 136. Now, the question is whether the Stale Government deciding an appeal under R. 6(6) of the Punjab Welfare Officers Recruit- ment and Conditions of S•! rvice Rules, 1952 (hereafter referred to as the Service Rules) is a tribunal within the meaning of Art. 136 of the Constitution. The State Governinent made the Service Rules in exercise of its rule-making power under s. 112 read with s. 49(2) of the Factories Act, 194 7. The Service Rules relate to G H A. C. C. LTD. v. P. N. SHARMA (Bachawat, J. ) 395 A the qualifications and conditions of service of a Welfare Officer in a factory and are well within the rule-making power. Rule 6 of the Service Rules prescribes the conditions of service of a Welfare Officer. Sub-rules (! ) and (2) of R.
6 provide that the Welfare Officer must have the appropriate status corresponding to the status of other executive heads of the factory, and his conditions B of service shall be the same as of other members of the staff of corresponding status in the factory. Sub-rule (3) empowers the management to impose on the Welfare Officer one or more of the following punishments, viz .. (i) Censure; (ii) With- holding of increments including stoppage at an efficiency bar; (iii) C reduction to a lower stage in a time scale; (iv) suspension; and (v) dismissal or termination of service in any other manner. The first proviso to sub-rule (3) provides that no order of punishment shall be passed against the Welfare Officer unless he has been in- formed of the grounds on which it is proposed to take action and given a reasonable opportunity of defending himself against the D action proposed to be taken in regard to him. The second proviso to sub-r.
( 3) imposes the further safeguard that the management cannot impose any punishment on him other than censure except with the previous concurrence of the Labour Commissioner, Punjab. Sub-rule ( 4) provides that before passing orders on a reference under the last proviso, the Labour Commissioner shall_ E give the Welfare Officer an opportunity of showing cause against the proposed action, and, if necessary, may hear the parties in per- son. Sub-rule (5) provides that if the Labour Commissioner refuses to give his concurrence, the management may appeal to the State Government within thirty days from the date of the receipt of such refusal. Sub-rule (6) provides that the Wel- F fare Officer upon whom the punishment of dismissal or termina- tion of service is imposed may appeal to the State Government against the order of punishment within thirty days from the date of the receipt of the order by him. The decision of the State Gov- ernment under both sub-rr.
(5) and (6) is made final and binding. Sub-rule (7) empowers the State Government to pass such interim G orders as may be necessary pending the decision of the appeal filed under sub-r. ( 5) or sub-r. ( 6). If the management imposes a punish- ment without making a reference to the Labour Commissioner and without obtaining his concurrence, the order of the management is a nullity and is liable to be set aside on this ground alone on an appeal by the Welfare Officer under sub-r. (6). On the other H hand, if the action of the management does not amount to a punishment, an appeal under sub-r. ( 6) is incompetent and is liable to be dismissed on that ground. 396 SUPRIIMB COURT llBPOllTS (1965] 2 S. C. R. I On an appeal under sub-r. (6), the dispute is whether the action A of the management amounts to a punishment and if so, whether ' the punishment should be imposed. Th~ dispute concerns the civil rights of the management and the Welfare Officer.
The State Government is empowered to decide this dispute between· the two contending parties. Since the State Government is empowered to give a decision, it may either confim:l the punishment or set it B aside and pass consequential orders such as an order of reinstate- ment. As a matter of fact, in the instant case the State Govern- ment passed an order of reinstatement. ' By the express words of sub-r. (6) of R. 6, the decision of the State Government is made final and binding. The appellate decisi9n conclusively determines C the rights of the contending parties with regard to the matter in ~ontroversy between them. The appellate function and the power . of conclusive determination of the civil rights of the parties with regard to matters in controversy between them indicate that the State Government is under a duty to act judicially and to decide the dispute solely by ascertaining the facts on the materials before D it and by the application of the relevant law. on the point.
& the rule does not prescribe any procedure for the hearing of the appeal, the State Government may dev\se its own procedure con- sistently with its judicial duty. Normally, the State Government has the advantage of enquiries with regard to the subject-matter of the dispute at two previous stages, yiz . • once by the manage- E men! under sub-r. (3) and again by the Labour Commissioner under sub-r. ( 4). The State Government may also call upon the parties to make their representations in writing, at the appellate stage. As a matter of fact, in this case the' parties were asked to make representations, and they did so. On ascertaining the relevant facts, the State Government may decide wh~ther having regard to the F relevant law, viz. , the ordinary law of master and servant as modi- fied by the industrial law, the action of the management amounts to a punishment, and if so, whether such punishment should be imposed.
A consideration of all these matters shows that the State Government cteciding an appeal under R. 6(6) of the Service Rules is vested with the judicial power~ of the State, and satisfies G the test of a tribunal as contemplated by Art. 136 of the Consti- tution. It follows that the preliminary objection that the appeal under Art. 136 does not lie, must be i;ejectcd. On the merits, the respondent has very little to say. The management did not seek to impose any;punishment on the. Welfare H Officer. It did not hold any enquiry with regard to any charge against the respondent. Under the conditions of service, the A. C,C. LTD, V. P. N. SHARMA (Bachawat, /. ) , 397 A management was entitled to terminate the services of the respon- dent on payment of one month's salary in lieu of notice. In ac- cordance with the conditions of service, the management terminat- ed his employment. In no sense was this order of termination of employment a punishment within the meaning of sub-r. ( 3) of R.
6 of the Service Rules. The order of the management did not entail B any evil consequences to the respondent; it did not deprive him of any right to which he was entitled. As the action of the manage- ment was not an order of punishment, the respondent was not en- titled to appeal from this order to the State Government, nor was the State Government entitled to order his reinstatement. The c appeal as al~ the order of the State Government passed on the appeal are both misconceived. The appellate order is not only erroneous but also without jurisdiction, and is liable to be set aside. Appeal al/awed.
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