The Court emphasized that the High Court's interference with the bank's disciplinary action and the award passed by the Labour Court was not justified, and clarified the application of the doctrine of proportionality in the case.

Judgment

C.K. THAKKER, J. - Leave granted.

2. A public utility undertaking (cooperative bank) challenges in this appeal an order passed by a Single Judge of the High Court of Judicature at Madras dated 18 - 9 - 2000 in Writ Petition No. 11948 of 1993 and modified by the Division Bench of the said Court on 3 - 11 - 2004 in Writ Appeal No. 45 of 2001.

3. To appreciate in its proper perspective an important question raised in the appeal, it is necessary to set out relevant facts.

4. The appellant is Coimbatore District Central Cooperative Bank having its head office at Coimbatore. It is having 17 branches in the revenue district of Coimbatore. It is the case of the appellant Bank that the Coimbatore District Central Cooperative Bank Employees Association ("the Union" for short) gave a "strike notice" on 31 - 3 - 1972 which was received by the Management on 5 - 4 - 1972 proposing to go on strike from 14 - 4 - 1972. The reason for such notice and going on strike was suspension of certain employees and withholding of their salary by the Management. Since the strike call was illegal and the notice was not in consonance with the provisions of the Industrial Disputes Act, 1947 (hereinafter referred to as "the Act"), the action of going on strike was unlawful. The Union was accordingly informed not to go on strike. The Labour Officer, Coimbatore in the meanwhile commenced conciliation proceedings in connection with certain issues raised by the Union. Despite proper advice by the Labour Officer, the employees commenced strike from 17 - 4 - 1972. The strike was totally illegal and unlawful. On 19 - 4 - 1972, notice was issued to the Union stating therein that the workmen should join duties by 22 - 4 - 1972 by tendering unconditional apology. The employees accepted it. A settlement had been arrived at between the Management and the Union and 134 employees gave up "strike call" and resumed work. 53 employees, however, refused to join duty and continued their illegal strike and acts of misconduct. The illegal acts of employees affected the work of the Bank very badly. It was alleged that not only did the workmen not join duty and continued illegal and unlawful strike, but also prevented other employees from resuming duty and threatened them with dire consequences if they returned for duty. Disciplinary proceedings were, therefore, initiated against 53 workmen, they were placed under suspension and inquiry was instituted. The employees were intimated of the charges levelled against them, which they denied. In spite of notices, the workmen did not participate in the disciplinary proceedings and remained absent. The Management was, therefore, constrained to proceed with the disciplinary inquiry ex parte against them. By an order dated 6 - 1 - 1973, the workmen were held guilty of the charges and an order of punishment was passed. By the said order, two punishments were awarded to the workmen: (i) stoppage of increment for 1 - 4 years with cumulative effect; and (ii) non - payment of salary during the period of suspension. According to the Bank, the case was an appropriate one to impose extreme penalty of dismissal from service, but by taking liberal view, the extreme punishment was not imposed on the employees and they were retained in employment by the Bank. The workmen joined duty on 17 - 11973. They should have accepted the order gracefully and appreciated the attitude adopted by the Management. The workmen, however, did not do so. They preferred to file appeal which was dismissed by the Executive Committee.

Decision of Labour Court

5. The workmen, being aggrieved by the decision, raised an industrial dispute and the matter was referred to the Labour Court, Coimbatore by the Government under Section 10 of the Act. The Labour Court after extending opportunity of hearing to both the sides and considering the evidence on record framed the following two issues:

1. Whether the punishment of stoppage of 1 to 4 increments with cumulative effect on