S. S. Shetty vs Bharat Nidhi Ltd

Rewritten Version Notice: This is a rewritten version of the original judgment.

Court: Supreme Court of India

Case Number: Civil Appeal No. 329 of 1956

Decision Date: 17 September 1957

Coram: Natwarlal H. Bhagwati, S.K. Das, P.B. Gajendragadkar

The case titled S. S. Shetty versus Bharat Nidhi Ltd was decided by the Supreme Court of India on 17 September 1957. The judgment was authored by Justice Natwarlal H. Bhagwati and the bench also comprised Justices S. K. Das and P. B. Gajendragadkar. The petitioner was identified as S. S. Shetty, an employee of the respondent, while the respondent was Bharat Nidhi Ltd. The official citation for the decision is reported as 1958 AIR 12 and also as 1958 SCR 442 in the law reports. The matters involved concerned an industrial dispute arising from wrongful dismissal, a tribunal direction for reinstatement, failure to implement the award, and the computation of monetary value of the benefit of reinstatement. The relevant statutes mentioned were Section 95 of the Code of Civil Procedure, 1908, and Sections 20(1) and 20(2) of the Industrial Disputes (Appellate Tribunal) Act, 1950. According to the headnote, the appellant had been employed by the respondent but was later dismissed on the ground that he had become surplus to the respondent’s requirements. The Industrial Tribunal found that the respondent had engaged in unfair labour practice and victimisation, declared the dismissal illegal, and ordered the appellant’s reinstatement with arrears of salary and allowances from the date of discharge. Because the respondent failed to carry out the reinstatement order, the appellant invoked Section 20(2) of the Industrial Disputes (Appellate Tribunal) Act, 1950, seeking a monetary valuation of the benefit of reinstatement. The Industrial Tribunal quantified the benefit of reinstatement at Rs 1,000, applying the damage measure prescribed in Section 95 of the Code of Civil Procedure. The respondent’s bye‑laws permitted termination of an employee’s services by providing one month’s notice to the employee prior to discharge. The Court held that the monetary value of the benefit of reinstatement should not be measured by a breach of contract or a tort arising from the employer’s failure to implement the reinstatement direction. Instead, the Tribunal must determine the amount by considering all relevant circumstances, such as the terms of employment, length of service, possibilities of termination by either party, retrenchment, resignation, retirement, or even the employer’s dissolution. The Court also referred to the observations of Justice Greer L. J. in the case Salt v. Power Plant Co., Ltd. (1936) 3 All E.R. 322 at page 325. Applying the bye‑laws to the facts, the Court concluded that the appellant would have been entitled to only one month’s salary in lieu of notice as compensation for the failure to implement the reinstatement direction. However, the Court noted that this right could not be exercised by the respondent in view of the Tribunal’s finding of unfair labour practice and victimisation against the respondent.

The Court noted that the Tribunal had found the respondent guilty of an unfair labour practice and of victimising the appellant, and that a proper valuation of the benefit of reinstatement had to be made while taking all relevant factors into account. The matter before this Court was a civil appeal numbered 329 of 1956, filed under special leave. The appeal challenged a decision dated 29 April 1954 of the Labour Appellate Tribunal in Lucknow, which itself had affirmed an award dated 24 January 1953 issued by the Central Government Industrial Tribunal in Calcutta in the course of Application No. 106 of 1952. The appellant was represented by counsel for the appellant, while the respondent was represented by counsel for the respondent. The judgment was delivered on 17 September 1957 by Justice Bhagwati, and it set out that the present appeal sought to overturn the earlier decision of the Labour Appellate Tribunal of India, Lucknow, which had upheld the award made by the Central Government Industrial Tribunal, Calcutta, in a dispute between the two parties.

The factual matrix recorded by the Court showed that the appellant had entered the service of the respondent, then known as Bharat Bank Ltd., on 1 July 1944 as an Inspector stationed in Bombay. He was placed in the pay grade denoted as Rs. 170‑10‑200‑20‑400 and received three salary increments, the first of which took effect on 1 October 1945. He also obtained promotions on 1 October 1946 and on 1 October 1947. At the time of his discharge on 5 August 1949, he was drawing a monthly salary of Rs. 240 together with a special servant allowance of Rs. 30. The discharge was justified by the respondent on the ground that the appellant had become surplus to its requirements. Subsequently, the Ministry of Labour, Government of India, issued Notification No. LR‑2 (273) on 21 February 1950, referring the industrial disputes between various banks and their employees to the Central Government Industrial Tribunal at Calcutta. The appellant’s case was heard therein, and on 5 December 1950 the Tribunal held that the discharge order was illegal, directing the respondent to reinstate the appellant and to pay all arrears of salary and allowances from the date of discharge. The Tribunal required that this direction be complied with within one month of the award’s publication, which occurred in the Gazette of India (Part II, Section 3, page 1143) on 30 December 1950. Dissatisfied, the respondent filed an appeal on 30 January 1951 before the Labour Appellate Tribunal, Calcutta, sitting at Allahabad. By its order dated 25 September 1951, that Tribunal affirmed the Industrial Tribunal’s directions and dismissed the appeal. Despite this, the respondent neither acted upon nor complied with the reinstatement order within the stipulated period. The appellant, having written to the respondent on 10 October 1951 from his address at 37, Faiz Bazar, Delhi, informing them of his presence in Bombay and seeking instructions on where to report for duty, also claimed the arrears of salary and allowances due to him. The respondent failed to reply, prompting the appellant’s solicitors to serve a notice on 5 November 1951 stating that the respondent’s failure to reinstate him constituted a breach of the Labour Appellate Tribunal’s directions, thereby entitling the appellant to compensation.

In a letter dated 10 October 1951, addressed to the respondent’s office at 37 Faiz Bazar, Delhi, the appellant informed the respondent that he was then staying in Bombay and asked where he should report for duty. In the same correspondence he demanded the arrears of salary and allowances that had not been paid to him, apart from the amounts already discharged under the interim orders of the Labour Appellate Tribunal. The respondent gave no reply to this letter. Consequently, on 5 November 1951 the appellant, through his solicitors, served a notice on the respondent stating that the respondent had failed and neglected to reinstate him despite his earlier request of 10 October 1951. The notice further asserted that the respondent’s failure to reinstate the appellant within the time prescribed by the Labour Appellate Tribunal amounted to a breach of those directions, thereby making the appellant entitled to compensation. The appellant therefore demanded that the respondent pay him a sum of Rs 32,388 as compensation for the salary he would have earned up to his fifty‑fifth birthday, that is, until 4 May 1960, together with Provident Fund contributions calculated at six and one‑quarter percent as permitted by the bank’s rules and gratuity for approximately sixteen years from 1 July 1944 to 4 May 1960, calculated at one month’s pay for each year of service and adjusted at six percent per annum if the payment was made on demand. The appellant clarified that this amount was exclusive of other claims he had against the respondent, including sums due under the order of 17 February 1951 of the Labour Appellate Tribunal, Allahabad, and arrears of salary that the respondent continued to withhold. Because the respondent neither answered the notice nor complied with its demands, the appellant applied to the Government of India on 22 February 1952 for recovery of money under section 20(1) of the Industrial Disputes (Appellate Tribunal) Act, 1950. The government replied on 13 May 1952, indicating that an application under that provision could be entertained only for arrears of salary and allowances from the date of discharge up to the date of the application, and it advised the appellant to file a revised application accordingly. The reply also suggested that the appellant could approach the Industrial Tribunal, Calcutta, under section 20(2) of the Act to obtain a monetary computation of the benefit of reinstatement, because only after a definite sum was determined could the government proceed with recovery under section 20(1). During this period, it appears that the respondent transferred its banking business to the Punjab National Bank under an agreement and consequently changed its name.

The respondent, having transferred its banking business to the Punjab National Bank Ltd. and having changed its name to Bharat Nidhi Ltd., sent a letter dated 3 April 1952 to the appellant. In that letter the respondent explained that, because of the transfer of its liabilities and equivalent assets to the Punjab National Bank Ltd. and the closure of all its branches in India, the appellant was now surplus to its requirements. Accordingly, the respondent claimed to give the appellant a two‑month notice of its intention to terminate the award and his services in accordance with section 19(6) of the Industrial Disputes Act, 1947. The letter further asserted that the appellant had not yet reported for duty at the respondent’s office in Delhi, which was the only office that the respondent retained in India after 10 March 1951 and which had previously been its Head Office and registered office.

The appellant replied through his counsel in a letter dated 16 April 1952. In that reply the appellant pointed out that, despite his own letter of 10 October 1951 addressed to the respondent requesting details of where and when he should report for duty, the respondent had failed to inform him of any such instructions and had not responded to his enquiry. The appellant further explained that he had already filed an application with the Government of India under section 20(1) of the Industrial Disputes (Appellate Tribunal) Act and was awaiting the outcome of that application. The appellant characterised the respondent’s 3 April 1952 letter as being issued with an evident ulterior motive.

On 10 May 1952 the respondent sent another letter to the appellant reiterating that, in spite of the respondent’s request, the appellant had failed to join its Delhi office. The respondent claimed that the 3 April 1952 letter had clearly asked the appellant to report to Delhi, that the appellant’s failure to do so amounted to evasion of the respondent’s instructions and constituted an absence from duty. The respondent also stated that the notice given on 3 April 1952 became effective from the date the appellant received it, namely 9 April 1952. The appellant made no further reply to this communication.

Subsequently, on 28 June 1952 the respondent addressed a letter to the Under‑Secretary, Government of India, New Delhi, in response to a communication dated 12 June 1952 from that office. In its letter the respondent informed the Government that the appellant had already been paid the arrears of his salary and allowances awarded by the Tribunal, that he had been asked again to resume duty which he had not done, and that, in the circumstances, he was being considered absent from duty. The respondent enclosed with this letter a copy of the 10 May 1952 letter sent to the appellant as well as a copy of the same‑dated letter addressed to the Chief Labour Commissioner (Central), New Delhi, for the Government’s information.

It was recorded that after the exchange of letters, no further communication occurred until 8 October 1952, when the appellant lodged a petition under section 20(2) of the Industrial Disputes Act seeking a monetary valuation of the benefit of reinstatement. The petition claimed that the respondent had failed to carry out the directions contained in the award and therefore asked for a sum of Rs 47,738, the amount being calculated as shown in annexure “D” attached to the petition. The respondent filed its written statement on 4 December 1952. In that statement the respondent pleaded that the appellant had willfully ignored the clear instructions to re‑join his duty, thereby committing a flagrant breach of the award and forfeiting any right to reinstatement or any benefits flowing from it. The respondent further mentioned that, without prejudice and in order to close the matter, it had offered the appellant salary up to 19 June 1952 by a letter dated 15 November 1952, which had been communicated to the Conciliation Officer, Central Government, New Delhi; the appellant, however, had not responded to that offer. The respondent also contended that the award in question was valid for only one year pursuant to section 19(3) of the Industrial Disputes Act, 1947, and that, having expired, the award was no longer operative and had already been terminated by the respondent. Consequently, the respondent described the appellant’s claim as illegal and preposterous and prayed that the petition be dismissed with costs.

The petition was subsequently heard before the Central Government Industrial Tribunal at Calcutta. During the hearing the Tribunal observed that the case involved three distinct aspects. First, whether the respondent had refused to implement the award—or the later decision of the Labour Appellate Tribunal—by not reinstating the appellant as directed by the tribunals, a point raised by the appellant. Second, whether the appellant himself had failed to resume his duties after being asked to do so, thereby forfeiting the right conferred by the award, a contention advanced by the respondent. Third, the Tribunal was required to determine the nature of relief or compensation in lieu of reinstatement to which the appellant might be entitled, given the unusual circumstance that Bharat Bank had ceased operations shortly after the December 1950 award and considering other employees’ applications that had resulted only in retrenchment relief.

On the first two questions the Tribunal decided in favour of the appellant. Turning to the third question, the Tribunal examined the applicable legal principles and concluded that the appropriate measure of damages was that prescribed under section 95 of the Code of Civil Procedure. Applying that provision, the Tribunal fixed the monetary value of reinstatement at Rs 1,000 and awarded that amount under section 20(2) of the Act. The Tribunal did not address the appellant’s other prayers for arrears, as those matters were pending before the Central Government under a separate application filed under section 20(1) of the Act.

The appellant had earlier made an application under section 20(1) of the Act to the Central Government, and the matters raised in that application formed the subject‑matter of the present proceedings. Dissatisfied with the award of the Industrial Tribunal, the appellant filed an appeal before the Labour Appellate Tribunal of India at Lucknow. Before the Labour Appellate Tribunal, the respondent raised a preliminary objection, contending that the appeal was not maintainable under the provisions of section 7 of the Act. The Labour Appellate Tribunal accepted that objection, held that the award did not raise any substantial question of law, and consequently dismissed the appeal as incompetent. The appellant then sought and obtained special leave to appeal against the decision of the Labour Appellate Tribunal, and that appeal now stands before this Court.

The factual issues in dispute concerned (i) whether the respondent refused to implement the award by failing to take the appellant back into service, and (ii) whether the appellant himself failed to resume his duties after being asked to do so, thereby forfeiting the right granted to him by the award. The Industrial Tribunal had examined the correspondence exchanged between the parties and had recorded findings on these two points. After reviewing the same correspondence, this Court found no reason to disturb those findings. Accordingly, if the appellant was prepared and willing to be reinstated and had not committed any default in reporting for duty, the remaining question for determination is the monetary amount at which the benefit of reinstatement, as awarded to the appellant, should be computed under section 20(2) of the Act.

The enquiry before the Industrial Tribunal was limited to deciding the correct method of such computation. Section 20(2) of the Act provides that when a workman is entitled to receive from the employer any benefit under an award or decision of an industrial tribunal that can be expressed in monetary terms, the industrial tribunal may determine the amount of that benefit, subject to rules made under the Act, and that amount may be recovered as prescribed in subsection (1). Subsection (1) further states that any money due from an employer under an award or decision of an industrial tribunal may be recovered either as arrears of land revenue or as a public demand by the appropriate government, upon an application made by the person entitled to the money. The appellant’s petition was premised on the premise that the benefit of reinstatement awarded to him was capable of being quantified in monetary terms, a position that the respondent did not dispute.

The Court observed that the entitlement to reinstatement granted to the appellant under the award could be expressed as a monetary sum, and that the respondent did not contest this characterization. Although the respondent’s written statement did not allege any circumstance that made reinstatement impossible, other than the appellant’s failure to resume his duties after being invited to do so, the respondent was nonetheless permitted to introduce evidence concerning the transfer of its liabilities and comparable assets to Punjab National Bank Ltd. and the subsequent closure of its banking operations across all Indian branches. The purpose of this evidence was to demonstrate that the respondent was not in default and that, as a result, the monetary value of the reinstatement benefit had become negligible. The respondent further relied on the fact that Punjab National Bank Ltd. was under no obligation to employ the former employees of the respondent, noting that only ten percent of those employees had actually been absorbed by the bank. For the remaining employees who were not taken on, the only awards awarded by the industrial tribunals consisted of salary for the notice period and retrenchment compensation. The Court held that these circumstances could not be invoked by the respondent to defeat the claim. While it was undisputed that the respondent transferred its liabilities and equivalent assets to Punjab National Bank Ltd. in March 1951, the correspondence exchanged between the appellant and the respondent showed that, despite this transfer and the change of the respondent’s name from Bharat Bank Ltd. to Bharat Nidhi Ltd., the respondent never asserted that Bharat Nidhi Ltd. was unable to reinstate the appellant. Throughout the letters, the respondent maintained that it remained in a position to restore the appellant to service and, in fact, claimed that it had invited the appellant to join at the Delhi office, an invitation the appellant allegedly ignored. In a letter dated 10 May 1952, Bharat Nidhi Ltd. expressly stated that the appellant’s failure to report to Delhi amounted to an absence from duty. Moreover, a later communication dated 28 June 1952, addressed to the Under‑Secretary of the Government of India in New Delhi, reiterated that the appellant had been asked to resume his duties, which he had failed to do, and consequently he was being treated as absent. The Court concluded that it was evident that Bharat Nidhi Ltd. consistently insisted that the appellant should have joined its service at Delhi.

The respondent never raised the argument that the transfer of its liabilities and equivalent assets to Punjab National Bank Ltd., or the possibility that Punjab National Bank Ltd. might not have taken the appellant into its employment, could be used as a defence. The appellant’s claim that he had become surplus to the respondent’s requirements was, in fact, a point made by the respondent in its correspondence. By way of illustration, the respondent’s letter dated 3 April 1952 gave the appellant two months’ notice that it intended to terminate both the award and the appellant’s service. In support of that notice the respondent relied on section 19(6) of the Industrial Disputes Act, 1947. However, when the respondent filed its written statement, it did not advance that argument as a defence to the appellant’s claim under section 20(2) of the same Act. Consequently, the Court could not understand how those circumstances could have been taken into account by the Industrial Tribunal when it calculated the monetary value of the benefit of reinstatement that the award had granted to the appellant. The calculation therefore had to be made without regard to the respondent’s last‑minute arguments. The Industrial Tribunal performed the computation by analogy with section 95 of the Code of Civil Procedure. It treated the failure to implement the reinstatement direction in the award as equivalent to obtaining an arrest, attachment or injunction on insufficient grounds, and accordingly awarded the appellant a sum of Rs 1,000 as reasonable compensation for the injury he suffered. Even if the direction in the award were regarded as a statutory obligation imposed on the respondent, that fact could not itself constitute a measure of compensation or damages, and the respondent’s counsel conceded that he could not support that portion of the judgment. Counsel for the appellant, Mr Lyengar, argued before the Court that the monetary value of the reinstatement benefit should be assessed on one of three alternative bases. First, the reinstatement order should be construed as giving the appellant the right to the full term of service contemplated in his original contract, and he should receive compensation corresponding to the salary and benefits he would have earned up to the age of superannuation, which was 55 years. Second, the failure to implement the reinstatement direction should be treated as a breach of contract by the respondent, entitling the appellant to damages for that breach. Third, the non‑implementation should be regarded as a breach of a statutory duty, allowing the appellant to claim damages on the basis of a tort committed by the respondent, including both general and special damages for the oppressive conduct of the respondent.

In that scenario, the non‑implementation of the reinstatement order could be treated as a breach of a statutory duty, and the appellant could be awarded damages as if a tort had been committed by the respondent. Under such a view the appellant would be entitled not only to general damages but also to special damages because of the oppressive conduct of the respondent. The Court observed that the ordinary law of master and servant supplies a clear rule. When a master wrongfully dismisses his servant, the master must pay damages that compensate the servant for the injury suffered. The measure of those damages is assessed by reference to the earnings the servant would have received during the wrongfully terminated service and the period likely to elapse before the servant obtains a comparable post. If the contract specifies a termination right, for example a month’s notice, the ordinary measure of damages would be a month’s wages. The Court further noted that compensation cannot be claimed for injury to the servant’s feelings or for the extra difficulty of finding work caused by the dismissal. The dismissed servant is required to use diligence in seeking other employment, and the fact that a suitable post has been offered may be taken into account when assessing damages. The above principles are set out in Chitty on Contracts, 21st edition, volume two, paragraph 1040. If the employment contract is for a fixed term, the servant is entitled to damages measured prima facie, subject to the rule of mitigation, for the salary that the master deprived him of, as explained in Collier v. Sunday Referee Publishing Co., Ltd. (1940) 4 All E.R. 237.

The Court explained that, where the contract is regarded as subsisting, a servant who seeks a declaration that he remains employed may be awarded only the salary, benefits and other emoluments that accrued up to the date the suit was filed. In such a claim the servant does not receive the whole salary and benefits that would have been earned for the remainder of the original contract, because the entitlement to those amounts depends on a finding that the employer has breached the contract of employment. Accordingly, damages for wrongful dismissal are recoverable only on the basis of a breach of contract by the master. By contrast, if the servant claims that the contract continues and requests the continuation of salary and benefits, the remedy is limited to a declaration of continued employment and payment of amounts that have already become due. The Court further observed that the benefit of reinstatement awarded to a workman under the terms of an industrial award does not, by itself, become a term or condition of the contract between the workman and his employer.

In this case the Court observed that reinstatement cannot be regarded as a term or condition of the contract existing between the workman and his employer. The Court noted that, apart from reinstatement, other forms of relief may be granted by the appropriate tribunal that involve changes in the terms and conditions of employment; such changes, when awarded, may be treated as implied terms of the contract that binds the employer and the workers to whom the award applies, and those implied terms would benefit the worker until they are varied by appropriate legal proceedings. The Court further observed that there is no specific statutory provision in the Industrial Disputes Act, 1947 that deals with such a situation. However, the Court found it noteworthy that the Industrial Disputes Order, 1951, which was obtained in England, contains Section 10, which reads as follows: “Section 10: Award to be implied term of contract: Where an award on a dispute or issue has been made by the Tribunal then as from the date of the award or from such other date, not being earlier than the date on which the dispute or issue to which the award relates first arose, as the Tribunal may direct, it shall be an implied term of the contract between the employer and workers to whom the award applies that the terms and conditions of employment to be observed under the contract shall be in accordance with the award until varied by agreement between the parties or by a subsequent award of the Tribunal or until different terms and conditions of employment in respect of the workers concerned are settled through the machinery of negotiation or arbitration for the settlement of terms and conditions of employment in the trade or industry or section of trade or industry or undertaking in which those workers are employed.” The Court clarified that, irrespective of how the terms and conditions of employment may be varied in accordance with such an award, the benefit of reinstatement granted to a workman cannot be treated as part of the contractual relationship between him and his employer. The Court explained that an order of reinstatement merely nullifies the order of wrongful dismissal and restores the workman to the employer’s service as if the original contract of employment had continued uninterrupted. Consequently, the contract’s terms and conditions that existed at the time of the wrongful dismissal remain applicable and continue to govern the relationship between the parties, with the workman resuming his employment under those unchanged terms. The Court emphasized that there is no modification of the contract’s terms and conditions; the sole effect is that the workman is placed back in his former position. Finally, the Court held that the monetary value of the benefits arising from such reinstatement must be calculated not on the basis of a breach of the employment contract, nor on the basis of any alleged tort committed by the employer in connection with the dismissal.

The Court observed that the dispute arose not from a failure to implement the direction for reinstatement contained in the award, but from the workman’s request for a monetary valuation of the benefit of reinstatement that the Industrial Tribunal had granted and which the employer had failed to carry out. The Court explained that a suit seeking a declaration that the workman continued in the employ of the employer and that he should be paid the salary and benefits that would have accrued up to the date of filing the suit is not a proper analogy. This is because the workman is not seeking a declaration that he remains in service on the ground that his service was terminated after the award, an alleged termination that the Court holds to be void. Instead, he seeks a computation, expressed in money, of the value of the reinstatement benefit awarded by the Tribunal.

The Court noted that the purpose of section 20(2) of the Industrial Disputes Act is not to grant the workman compensation or damages for a breach of contract or for a breach of a statutory duty by the employer. Under section 20(1), any monetary amount due from an employer under an award may be recovered by the appropriate Government on an application made by the workman. However, where the award confers a benefit that is not expressed in monetary terms, the workman must first obtain a monetary valuation of that benefit before he can approach the Government for assistance in recovery.

Accordingly, section 20(2) provides for the computation in monetary terms of the value of such a benefit. The amount of that computation is to be determined by the Industrial Tribunal, and the appropriate Government will refer to that determination for the purpose of recovery. The Court emphasized that the computation relates only to the date from which the reinstatement was ordered under the award, and that the Tribunal must consider all the circumstances of the case in making that calculation.

The Tribunal, the Court explained, must take into account the terms and conditions of employment, the length of service, the possibility that either party could terminate the employment, the likelihood of retrenchment by the employer, resignation or retirement by the workman, the eventual cessation of the employer’s existence, and the prospect that the workman might be awarded further benefits, including reinstatement, under future awards in any industrial disputes that may arise between the parties. The Court further observed that even in ordinary master‑servant contracts, courts have considered such factors. In support of this view, the Court referred to the observations of Justice Greer in Salt v. Power Plant Co., Ltd., noting the relevance of those remarks to the present situation.

In its assessment, the Court noted that, in the author’s view, the plaintiff had entered into an engagement that was intended to last for his lifetime, or at least for the joint lives of the plaintiff and the company, and that, according to certain authorities, the winding up of a company would constitute a dismissal of its servants, thereby entitling them to claim damages and to receive whatever dividend might be declared. The Court observed that, although the company had not been wound up, any tribunal tasked with quantifying damages would have to keep in mind that, after 26 June 1935, the directors might have believed they possessed legitimate reasons, related to the plaintiff’s conduct, for terminating his services. The tribunal would also need to consider the present value of the salary that the plaintiff would have earned for the remainder of his life, the fact that the plaintiff’s service could cease at any time by virtue of his own death, and other variables that the Court deemed unnecessary to elaborate further. These considerations, the Court explained, were equally relevant when calculating the monetary value of the reinstatement benefit that had been awarded to the appellant in the present case.

Turning to the specific terms and conditions of employment, the Court observed that the respondent had promulgated bye‑laws governing the employees of Bharat Bank Ltd., and that these bye‑laws applied to the appellant. Bye‑law 9 stipulated that an employee could resign by giving one month’s notice. Bye‑law 11 provided that the respondent could terminate an employee’s service by giving the same notice period required of the employee under rule 9, even if the employee was on leave, or by paying salary in lieu of that notice, unless there was an agreement to the contrary; however, no notice was required when the employee was dismissed for misconduct, dishonesty, gross negligence, insubordination, or for ignoring any standing instructions (see Salt v. Power Plant Co., Ltd., [1936] 3 All E.R. 322, 325). Bye‑law 13 mandated that every employee retire upon reaching the age of 55, and that any extension beyond that age could be granted only with the express approval of the authorities and could not exceed two years at a time. Considering these provisions, the Court held that the respondent was able to terminate the appellant’s service by paying him one month’s salary in lieu of notice. Absent any other factor, the appellant would have been entitled solely to that amount as compensation for the non‑implementation of the direction for reinstatement. Nevertheless, the Court noted that the Industrial Tribunal had made a finding regarding the matter, which was recorded in the award dated 5 December 1950.

The award dated 5 December 1950 concluded that the respondent had engaged in unfair labour practice and victimisation, and therefore the respondent could not rely on the ordinary authority to terminate the appellant’s service by paying one month’s salary in lieu of notice. The Court observed that, should the appellant raise an industrial dispute concerning any future termination by the respondent, the Industrial Tribunal would be required to examine whether such termination was justified. If the Tribunal were to reach an adverse finding, it would have the power to order the appellant’s reinstatement in the respondent’s service together with all back‑salary, allowances and other accrued benefits. The Court further noted that even if the respondent sought to retrench the appellant, the same considerations would arise and could potentially lead to an unfavorable outcome for the respondent. Conversely, the Court recognised that there existed a possibility that the respondent might be justified in lawfully terminating the appellant’s employment, in which case the appellant would have no remedy. In assessing the monetary value of the benefit of reinstatement, the Tribunal was required to take into account the present value of the appellant’s salary and benefits up to the date of his superannuation, and to calculate this value from the date on which reinstatement was ordered under the terms of the award. The Court held that it was impossible to determine this monetary value with mathematical exactness; at most, a tribunal or court could arrive at the most accurate estimate possible, considering all relevant positive and negative factors. After careful deliberation, the Court concluded that, given the circumstances of the case, a reasonable estimate of the reinstatement benefit amounted to Rs 12,500 (Rupees twelve thousand five hundred only). Accordingly, the Court allowed the appeal, set aside the decision of the Labour Appellate Tribunal of India, Lucknow, as well as the award made by the Central Government Industrial Tribunal, Calcutta, and awarded the appellant the sum of Rs 12,500 as the computed monetary value of the reinstatement benefit under the December 5 1950 award. The respondent was also ordered to pay the appellant’s costs of the appeal together with the costs of the proceedings before both the Industrial Tribunal and the Labour Appellate Tribunal.

The appellate tribunal carefully examined the record and concluded that the appellant's contentions warranted the granting of the appeal. Accordingly, the court issued an order stating that the appeal is allowed, which constitutes the operative portion of the judgment. The succinct wording of the order reflects the court’s determination that the appeal has succeeded on its merits. By declaring the appeal allowed, the tribunal affirmed that the issues raised by the appellant were sufficient under the applicable standards. No additional directions or conditions accompany the statement, indicating that the sole operative instruction is the allowance of the appeal. The order thereby concludes the appellate proceedings, as the allowance of the appeal resolves the matter before this court. The judgment’s brevity underscores that the appellate decision is confined to the finding that the appeal should be granted. Consequently, the official record reflects a clear and unambiguous determination that the appellant succeeded in the appeal on the merits. Thus, the appellate judgment consists solely of the declaration that the appeal is allowed, which constitutes the final order of this court. The parties are therefore bound by this determination, and the case stands closed as to the matters presently before the appellate tribunal.