Judgment

VAIDIALINGAM, J.: The short question that arises for consideration in this appeal, by special leave, is whether by terminating the services of the three clerks in question,. The appellant Company had made any illegal change within the meaning of S. 46 of the Bombay Industrial Relations Act, 1946 (Bombay Act XI of 1947) (hereinafter to be referred as the Act).

2. The facts leading up to the appeal may be stated. The appellant Company was the former proprietor of the New Pralhad Mills, Bombay. At the material time, namely, 1957, the mills were working three shifts in some of their departments. On December 8, 1957, the third shift was closed. On January 7, 1958 the appellant issued notices to the three clerks Nayak, Kelwalkar and Mhatre, with whom we are concerned in these proceedings, terminating their services with effect from February 8, 1958.

3. The second respondent herein, the union of the workers employed in the mills, by their letter dated February 7, 1958 requested the management to cancel the notices terminating the services of the clerks. The management sent a reply to the Union on February 10, 1958 justifying their action and declining to accede to the request of the Union. The exact terms of the notices dated January 7, 1958 as well as the reply dated February 10, 1958 will be adverted to later. There was also another clerk Dhuri against whom a notice of termination of service had also been issued. But we are not concerned with that clerk in these proceedings.

4. The Union filed four applications before the Second Labour Court at Bombay, challenging the termination of the services of the four clerks, referred to above, on the ground that the appellant had reduced the clerical strength of the Company without following the procedure prescribed in the Act and as such the appellant had committed an illegal change. In consequence the Union prayed for a declaration that the appellant Company had committed an illegal change and further prayed for the reinstatement of the clerks after directing the management to withdraw the illegal change. An additional ground for reinstatement was also urged. It was urged that the management had also contravened Section 25-G of the Industrial Disputes Act, 1947. On these allegations the Union after praying for the reinstatement of the clerks desired also payment of compensation from the date of termination of their services till their reinstatement.

5. The main defence of the appellant was that no illegal change has been made and hence the Labour Court had no jurisdiction to entertain the applications. They further denied that there has been any contravention of Section 25-G of the Industrial Disputes Act, 1947 inasmuch as no clerks junior to those whose services were terminated had been retained in service. According to the appellant the clerks were retrenched as they were surplus to the requirement of the mills.

6. The Labour Court, on a consideration of the materials produced before it, held that by terminating the services of the clerks, the appellant has really effected a reduction in three clerical posts. It is the further view of the Labour Court that as this reduction of posts had been done without giving a notice of change under the Act, its action was illegal and that the Company was guilty of making illegal change in contravention of Section 46 of the Act. The Labour Court further held that so far as Nayak and Kelwalkar were concerned the principles of "last come first go" embodied in Section 25-G of the Industrial Disputes Act had been contravened as those two clerks were senior to several others who were still retained in service. As regards the third clerk Mhatre, the Labour Court accepted the appellant s plea that he was only a temporary clerk for the third shift and that with the stoppage of the third shift his termination was justified. In consequence, the Labour Court passed an other, on June 19, 1959 directing the appellant to withdraw the illegal change introduced by