A) ABSTRACT / HEADNOTE

The Supreme Court of India addressed the interplay between the employer’s right to suspend workmen pending dismissal proceedings under Section 33 of the Industrial Disputes Act, 1947 and the workmen’s entitlement to wages during the suspension period. The case arose when three hotel managements—Imperial Hotel, Maiden’s Hotel, and Swiss Hotel—decided to dismiss certain employees after internal inquiries found them guilty of misconduct. Since industrial disputes were already pending, Section 33 required prior permission of the Industrial Tribunal for dismissal. The hotels suspended the concerned workmen without pay during this period. The workmen sought interim relief for full wages and allowances, which the Industrial Tribunal granted. The Labour Appellate Tribunal upheld this decision. The Supreme Court examined two questions: (1) whether wages were payable during suspension pending Section 33 permission, and (2) whether interim relief could be granted without an interim award being published. The Court held that, unlike the ordinary law of master and servant—which does not imply a suspension without pay unless expressly provided—the special circumstances under Section 33 justified implying a contractual term allowing suspension without wages after a proper inquiry and pending permission. However, the Tribunal retained the power to grant interim relief under Section 10(4) for matters incidental to the dispute. Ultimately, the Court modified the relief to half wages pending adjudication, balancing fairness between employer and workmen.

Keywords: Industrial Disputes Act 1947, Section 33, Suspension without pay, Interim relief, Implied contractual term, Master and servant, Industrial Tribunal powers.

B) CASE DETAILS

i) Judgement Cause Title:
The Management of Hotel Imperial, New Delhi & Others v. Hotel Workers’ Union

ii) Case Number:
Civil Appeals Nos. 31-33 of 1958

iii) Judgement Date:
May 21, 1959

iv) Court:
Supreme Court of India

v) Quorum:
B.P. Sinha, P.B. Gajendragadkar, and K.N. Wanchoo, JJ.

vi) Author:
Justice K.N. Wanchoo

vii) Citation:
1960 (1) SCR 476

viii) Legal Provisions Involved:

• Industrial Disputes Act, 1947 – Sections 10(4), 33, 33A, 15, 17, 17A

• Common law principles of master and servant

ix) Judgments overruled by the Case:
None explicitly overruled; earlier precedents were clarified and explained.

x) Case is Related to which Law Subjects:
Industrial Law, Labour Law, Employment Law, Procedural Law

C) INTRODUCTION AND BACKGROUND OF JUDGEMENT

The judgment arose in the backdrop of industrial unrest in Delhi’s hospitality sector during the mid-1950s. Disputes over working conditions escalated into strikes, with Imperial, Maiden’s, and Swiss Hotels experiencing collective work stoppages. Prior to the strikes, internal disciplinary inquiries had already been initiated against several employees for alleged misconduct. Given that industrial disputes were already before the appropriate government, Section 33 of the Industrial Disputes Act prohibited employers from altering service conditions or dismissing employees without prior tribunal permission. The employers, therefore, suspended the implicated employees without pay pending permission. The crux lay in determining whether such suspension without wages was lawful absent an express contractual or statutory provision, and whether the Tribunal could order interim payment pending resolution.

D) FACTS OF THE CASE

In August 1955, Imperial Hotel served charge-sheets on 22 workmen, held inquiries, and decided to dismiss them. Notices dated October 4, 1955, communicated this decision, subject to obtaining Section 33 permission. The following day, a general strike erupted across all three hotels. The management issued rejoining notices, followed by suspension orders for non-compliance. By October 7, 1955, the hotels had decided to dismiss additional employees, again suspending them pending permission.

For Imperial Hotel, 44 employees were implicated—25 through an October 12, 1955, government reference and 19 through a Section 33A application filed by workmen alleging unlawful suspension without pay. Maiden’s Hotel involved 26 employees (later reduced to 14 due to re-employment), while Swiss Hotel involved 14 employees. Workmen applied for interim relief—full wages and food allowance—which the Industrial Tribunal granted on December 5, 1955. Appeals to the Labour Appellate Tribunal failed. The Supreme Court granted special leave and stayed the full wage order, directing payment of half wages until disposal.

E) LEGAL ISSUES RAISED

i) Whether wages are payable to workmen suspended without pay pending Section 33 permission to dismiss.

ii) Whether the Industrial Tribunal can grant interim relief without issuing an interim award for publication under Section 17.

F) PETITIONER/ APPELLANT’S ARGUMENTS

i) The employers argued that once a proper inquiry had established misconduct and dismissal was decided upon, suspension pending Section 33 permission should relieve them of the obligation to pay wages. They relied on the principle that the contract of service effectively ends upon dismissal decision, but Section 33 imposes a statutory restraint, justifying suspension without pay. They further contended that interim relief could only be granted via an interim award subject to publication under Sections 15, 17, and 17A.

G) RESPONDENT’S ARGUMENTS

i) The workmen, through the Union, contended that under the ordinary master-servant law, suspension without pay is impermissible unless expressly provided in the contract or by statute. No such terms existed in their employment, nor were there standing orders allowing unpaid suspension. Thus, wages remained payable during suspension. They further argued that interim relief was within the Tribunal’s powers as an incidental matter under Section 10(4) and did not require specific reference.

H) RELATED LEGAL PROVISIONS

i) Section 33, Industrial Disputes Act, 1947 – Restricts employer action altering service conditions or dismissing employees during pendency of disputes without Tribunal permission.
ii) Section 10(4) – Confines Tribunal adjudication to referred issues and matters incidental thereto.
iii) Section 2(b) – Defines “award” to include interim or final determinations.
iv) Sections 15, 17, 17A – Govern submission, publication, and enforceability of awards.

I) JUDGEMENT

a. Ratio Decidendi

The Court held that:

• Under ordinary law, unpaid suspension requires an express contractual or statutory basis.

• Section 33’s prohibition fundamentally alters master-servant law in industrial disputes, justifying an implied term in the employment contract permitting suspension without pay after a proper inquiry and pending dismissal permission.

• If permission is granted, no wages are due from the suspension date; if refused, back wages are payable.

• The Industrial Tribunal’s powers under Section 10(4) include granting interim relief incidental to the dispute, even if not expressly referred.

b. Obiter Dicta

The Court noted that the issue of whether interim relief requires publication as an interim award was not conclusively decided, assuming arguendo that such publication was necessary but holding that the Supreme Court could nonetheless grant interim relief directly.

c. Guidelines

• Suspension pending Section 33 permission must follow a proper inquiry and bona fide dismissal decision.

• Tribunals may imply contractual suspension powers in such contexts.

• Interim relief should generally not equal full final relief; proportionate payments (e.g., half wages) may be more appropriate.

J) CONCLUSION & COMMENTS

This case is pivotal in Indian labour law for recognising an implied right of unpaid suspension in the specific statutory framework of Section 33 proceedings. It harmonises the employer’s operational prerogatives with the statutory protection of workmen, while preserving the Tribunal’s incidental jurisdiction to grant interim relief. The Court’s approach balances fairness by allowing half-wage interim relief, preventing undue hardship to either side during prolonged adjudication.

K) REFERENCES

a. Important Cases Referred

• Hanley v. Pease & Partners Ltd., [1915] 1 K.B. 698

• Wallwork v. Fielding, [1922] 2 K.B. 66

• Secretary of State for India v. Surendra Nath Goswami, I.L.R. 1939 (1) Cal. 46

• Rura Ram v. Divisional Superintendent, N.W.R., I.L.R. VII (1954) Punj. 415

• Western India Automobile Association v. Industrial Tribunal, Bombay, [1949] F.C.R. 321

• Rohtas Industries Ltd. v. Brijnandan Pandey, [1956] S.C.R. 800

• Lakshmi Devi Sugar Mills Ltd. v. Pt. Ram Sarup, [1956] S.C.R. 916

• Management of Ranipur Colliery v. Bhuban Singh, C.A. 768/57 (20 April 1959)

• M/s Sasa Musa Sugar Works (P) Ltd. v. Shobrati Khan, C.A. 746 & 747/57 (29 April 1959)

• Phulbari Tea Estate v. Its Workmen, [1960] 1 S.C.R. 32

b. Important Statutes Referred

• Industrial Disputes Act, 1947 – Sections 2(b), 10(4), 15, 17, 17A, 33, 33A

• Common law of master and servant