1. These are three matters in which we are concerned with an industrial dispute between two employers, the Prakash Cotton Mills (Private), Ltd., Bombay, and the Sayaji Mills, Ltd., Ahmedabad, and their employees. Special Civil Application No. 1702 of 1964 is preferred by the Prakash Cotton Mills (Private), Ltd., and special Application No. 1589 of 1964 by Sayaji Mills, Ltd., Ahmedabad. Both the applications are directed against the overruling of certain preliminary objections, which the employers had raised to a reference made by the State Government in the industrial disputes concerned. Special Civil Application No. 423 of 1965 is preferred by Sayaji Mills, Ltd., against the order granting interim reliefs to its workers.
2. The circumstances under which the State Government came to make the Reference No. 28 of 1964 are as follows.
3. On 11 December, 1963 an award was made by the industrial court. Bombay, upon an agreement reached between the Rashtriya Mill Mazdoor Sangh, a recognize union of textile workers, and the employers and several others, in respect of bonus for the year 1962. During the pendency of the negotiations the employees were led to expect a much higher rate of bonus being paid to them and after the publication of the award, when the settlement in regard to the bonus came to be known, there was considerable dissatisfaction among the workers. The terms of the award become known on 12 December, 1963 and immediately most of the workers of both these textile mills and others went on strike. The strike continued on 13 December when the employers declared a lockup. Then upon intervention of Government the strike was called off on 16 December, 1963 upon certain assurances given by the employers, according to the employers. The quantum of the bonus granted by the award dated 11 December, 1963 was 7 percent, in the case of the Prakash Cotton Mills (Private), Ltd., and 5 per cent in the case of Sayaji Mills, Ltd. These were practically the lowest amounts granted out of the several mills which took part in the settlement and naturally, therefore, their employers were dissatisfied.
4. After the strike ended on 16 December, 1963 the petitioner-mills took action, against certain employees and on 2 or 3 January, 1964 they purported to discharge several of their workers. The Prakash Cotton Mills (Private), Ltd., discharged nine of their employees and the Sayaji Mills, Ltd., five employees. The order of discharge according to the petitioners was passed by them under standing order 19A of the standing orders applicable to operatives in textile mills. When these workers were discharged, the workers of the Sayaji Mills, Ltd., went on a further strike, claiming that the five discharged workers should be reinstated and making that as the ground for strike. It is not in dispute that there was no such strike in the Prakash Cotton Mills (Private), Ltd., though the industrial court has, as is clear from its order, been under an impression that there was such a strike even in the Prakash cotton Mills (Private), Ltd. This is one of the grounds on which the order, impugned before us of the industrial court, has been attacked by Sri Phadke.
5. Consequent upon the strike in the Sayaji Mills, Ltd., the employers applied to the second labour court at Bombay to have the strike declared as illegal. The application was made on 7 January, 1964 and the order passed upon that application has ultimately held that that strike was illegal. Pending the disposal of that application, however, other events took place.
6. On 27 February, 1964 the State Government stepped in and made a reference under S. 73 of the Bombay Industrial Relation Act out of which the present petitioner arise. The preamble of the reference was as follows :
'Whereas an industrial dispute has arisen between the Prakash Cotton Mills (Private), Ltd., Bombay, and its employees (hereinafter referred to as 'the said industrial dispute'), relating to the employees' demand specified in the schedule appended hereto;
And whereas the State Government is satisfied that the said industrial dispute is not likely to be settled by other means ...'
7. When this reference came up before the industrial court, it appears that it was pointed out that the Rashtriya Mills Mazdoor Sangh, which had represented the workers at the time of the award dated 11 December, 1963, was not a party and, therefore, the industrial court ordered the Rashtriya Mill Mazdoor Sangh to be joined. It was accordingly joined as a party to the reference on 7 March, 1964.
8. Curiously though that Sangh has, in spite of notice, taken no part before the industrial court and did not put in any statement or even an appearance. On 17 April, 1964 eight out of the nine employees discharged from the Prakash Cotton Mills (Private), Ltd., filed their written statements and the employers put in a reply raising several preliminary objections to the trial of the reference. We shall presently advert to such of those objections as have been pressed before us by Sri Phadke. On 13 July, 1964 a further statement to be field on behalf of the workers by one Jagtap claiming to be the authorized representative of the workers. The status and authority of Jagtap to represent these workers has been disputed before us on behalf of the petitioner. On 7 August, 1964 the mills filed a complete written statement in answer to the statements of claim put in by both Jagtap and the workers and the present order was passed by the industrial court on 1 October, 1964.
9. By the order the industrial court has negatived the several contentions and preliminary objections which the employers had raised not merely to the making of the reference, but to the jurisdiction of the state Government to make it. We are not concerned here with all these objections, but would state the three objections which Sri Phadke has substantially raised in the arguments in these petitions. Firstly, Sri Phadke urged that under S. 73 of the Bombay Industrial Relation Act, it is only in respect of an industrial dispute that the State Government can exercise the powers given to them, i.e., though the State Government's power to make a reference may be untrammelled in other respects, at least one condition must be fulfilled, viz, that they can only refer an industrial dispute and nothing else. Sri Phadke urged that what was referred by the State Government did not amount to an industrial dispute for the reason that it was purely a dispute between the employers and stated employees who had been discharged and was not an 'industrial dispute' between employers and an employees or between an employers and employees, nor connected with any industrial matter as required by the definition contained in S. 3 Sub-sec (17). The second contention has been that in any event having regard to the provisions of S. 42 of the Bombay industrial Relations Act a reference under S. 73 is only competent if in the first instance the procedure prescribed by S. 42 is fulfilled. In other words, it is contended that unless a valid notice of change or a complaint against an illegal change is first made and the employer asked to rectify matters, the State Government would be incompetent to make a reference under S. 73. Thirdly, it has been contended that in these cases in fact there is no dispute and that even upon the findings given by the industrial court no dispute has been shown to exist and therefore once again the sine qua non for the exercise of the power under S. 73 was absolute. We shall deal with the contentions in Special Civil Application No. 423 of 1963 separately.
10. Turning to the first point argued, it is urged with such plausibility that though upon the facts stated there may exist a dispute between the nine discharged employees named in the reference and the Prakash cotton Mills (Private), Ltd., that dispute was not industrial dispute such as defined in S. 3, Sub-section (17), which says that 'industrial disputes' means any dispute or difference between an employer and employee or between employers and employees or between employees and employees and which is connected with any industrial matter. Sri Phadke has argued and in our opinion there is much force in the argument that workers who are dismissed or discharged as in the present case, cannot be brought under the category of employees nor can the two petitioners be said to be their employers and to that extent therefore any dispute between such persons and the erstwhile employers would not be an industrial dispute. It seems to an unnecessary however to go into this question, for in the present cases, not merely by the terms of the reference, but upon the facts tendered before the industrial court it is clear beyond doubt that what was referred was not the initial dispute between the nine employees discharged by the Prakash Cotton Mills (Private), Ltd., of the five employees discharged by Sayaji Mills, Ltd. Ahmedabad, but a dispute of a completely different nature. The industrial dispute referred is indicated by the preamble of the reference as follows :
'Whereas an industrial dispute has arisen between the Prakash Cotton Mills (Private), Ltd., Bombay, and its employees (hereinafter referred to as 'the said industrial dispute') relating to the employees' demand specified in the schedule appended hereto.
Demand. - The following employees should be reinstated with full back-wages from the date of discharge.'
11. Then follow the names and the departments in which they are engaged of the nine workers.
12. Therefore, in terms the reference says that the dispute was between the employees of the Prakash Cotton Mills (Private), Ltd., and the mills and not between the nine employees and the mills. On the other hand, the dispute between the nine employees and the mills is the subject-matter or cause of the industrial dispute between all the other employees and the employer. This, it seems to us, is patent upon the terms of the reference itself, for the dispute between the nine discharged employees is stated as the demand made by the rest of the employees. The same is the position in the case of the Sayaji Mills. Now, so far as the other employees are concerned, it can hardly be disputed that they would be employees within the meaning of the definition in S. 3(13) read with S. 3(17) giving rise to an industrial dispute. A dispute, which is initially a dispute between ex-employees and an ex-employer may give rise to a dispute with existing employees of the same employer, if the rest of the employees take up the question of dismissal and discharge as a grievance of their own and this is precisely what has happened in these two cases.
13. Reference was made in this respect to a decision of the Supreme Court in Bombay Union of Journalists and others v. Hindu, Bombay, and another : (1961)IILLJ436SC and particularly to the remarks in the penultimate paragraph of the judgment at p. 443 as follows :
'If the dispute was in its inception an individual dispute and continued to be such till the date of the reference by the Government of Bombay, it could not be converted into an industrial dispute by support subsequent to the reference even of workmen interested in the dispute.'
14. These remarks were made having regard to the facts in that case viz., that after what was purely an individual dispute had been put up for adjudication before the authorities other workers had joined and taken up the same dispute as their own; that is not the case here. On the other hand, upon the facts which we have stated, the dispute here was from the very inception taken up by the entire body of workers of the two petitioners as a dispute of their own. Even in the decision of their lordships of the Supreme court they have indicated at p. 442 that
'in each case in ascertaining whether an individual dispute has acquired the character of an industrial dispute the test is whether at the date of the reference the dispute was taken up as supported by the union of the workmen of the employer against whom the dispute is raised by an individual workman or by an appreciable number of workmen.'
15. In the present case not merely was the said dispute taken up by an appreciable number of workmen, but by the whole body of the workmen. That is clear not only upon the facts but also upon the statement contained in the terms of reference itself. Therefore, we can see no point in now saying that the dispute was a dispute where only individual workers were concerned. The first contention, therefore, cannot be accepted.
16. So far as the second contention is concerned, reliance was placed upon S. 42 which deals with the notice of change. Sub-section (1) deals with the procedure which an employer intending to effect a change has to follow. Sub-section (2) deals with the corresponding procedure which an employee has to follow when the employee desires a change and the substantial requirement is that the employee shall give a notice in the prescribed form to the employer through the representative of employees and the notice has to be forwarded to the authority concerned with the object of conciliation. Sub-section (3) then says that if no settlement is arrived at in any conciliation proceeding in regard to that industrial dispute and if after the expiry of two months the employer or employee still desires the same change or a change similar in all material particulars, he must give a fresh notice; otherwise within those two months the employer or employee can directly make an application to the labour court. The proviso to Sub-section (4) was strongly relied upon and it says :
'Provided that no such application shall lie unless the employee or a representative union has in the prescribed manner approached the employer with a request for the change and no agreement has been arrived at in respect of the change within the prescribe period.'
17. Sri Phadke says that this provision of the statute shows that the only mode by which an industrial dispute or an industrial matter can come before the authority is by giving notice of a change or illegal change and that, therefore, it is also a condition precedent to the exercise of the power under S. 73 by the State Government. In short, what has been urged is that without giving a notice of change or a notice that a change is needed or desired no reference can possibly be made by the State Government under S. 73. It seems to us that this is an extreme condition, which if accepted, would render S. 73 largely nugatory. Section 73 is in the following terms :
'73. Notwithstanding anything contained in this Act, the State Government may, at any time, refer an industrial dispute to the arbitration of the industrial court, if on a report made by the labour officer or otherwise it is satisfied that
(1) by reason of the continuance of the dispute
(a) serious outbreak of disorder or a breach of the public peace is likely to occur; or
(b) serious or prolonged hardship to a large section of the community is likely to be caused; or
(c) the industry concerned is likely to be seriously affected or the prospects and scope for employment therein curtailed; or
(2) the dispute is not likely to be settled by other means; or
(3) it is necessary in the public interest to do so.'
18. It is not in dispute that the words 'industrial dispute' in the opening clause of the section mean industrial dispute as defined in S. 3(17). There was some discussion as to the scope of the opening words of S. 73, 'Notwithstanding anything contained in this Act' but for the purpose of the points argued before us, it was also not disputed that this non obstante clause may be taken to apply only to the power of the state Government to refer. We do not hold that it is so, but we proceed upon that premise. The question would only arise if in the first instance the matter referred would be an industrial dispute.
19. Section 73, therefore, postulates as a condition to exercise of the power of the State Government to make a reference that an industrial dispute exists, but it does not follow, therefore, that S. 42 governs S. 73 or that without following the procedure prescribed in S. 42 no action can be taken by Government under S. 73. The provisions of S. 42 are limited in their scope. The section applies only to an industrial matter specified in Sch. II where an employer is concerned or to an industrial matter not specified in Sch. I or III where an employee is concerned, but it is patent that there may arise industrial disputes which do not fall while the ambit of S. 42. It is not therefore necessary in law that the procedure prescribed in S. 42 must invariably be followed before Government exercises its power to make a reference under S. 73.
20. Then we turn to the third point raised in these petitions which is a point of some substance. We have already said when considering the second point that in order to confer jurisdiction upon the State Government to make a reference there must exist an industrial dispute and in the present cases, that was precisely what the employer disputed before the industrial court. We have already stated the facts and one of the cardinal facts, which is not in dispute, is that as a result of the discharge of the workers in the Prakash Cotton Mills (Private), Ltd., there took place no strike such as did take place in the case of Sayaji Mills, Ltd. In the case of the Prakash Cotton Mills (Private), Ltd., the workers were discharged under standing order 19A as from 3 January, 1964 and the mills applied on 7 January, 1964 to have the strike declared illegal. Pending the decision of that application the reference was made on 27 February, 1964. Now, there does not appear upon the facts found by the industrial court anything to show that in regard to the discharge of the said workers there had been raised any dispute by the workers or that there had been any difference of opinion. According to the definition, 'industrial dispute' means 'any dispute or difference' and that was the central fact challenged on behalf of the employers. It has been argued that there was no difference or dispute. Now, no doubt in order to give rise to a dispute or difference, it is not necessary in every case that there should be an actual demand by the workmen on the management or a refusal by the management of the demand, but the industrial court must be satisfied that there was at least some dispute or difference between the employer and the employee. We would even go so far as to say, as was urged by Sri Nargolkar on behalf of the workers, that if the industrial court comes to the conclusion that in its opinion there existed a dispute or difference between the employer and the employees that finding would be binding upon us.
21. In the present cases, the industrial court has given such a finding but, so far as the Prakash Mills is concerned, the finding is based upon a completely incorrect premise in fact. In Para. 21 after quoting the decision in Tea Estate in Darjeeling v. their workmen 11 F.J.R. 449 the industrial court went on to say :
'In the present case the workmen have alleged that they agitated the matter of reinstatement of these workers by resorting to a strike and by approaching the Minister in charge of Labour in the Government of Maharashtra. They have further alleged that the matter had been communicated by the Minister to the management through mill-owners' association. At this stage, I must decide the preliminary point on the pleading only, and in my view, there is adequate assertion of a demand having been made and refused in this case. At no stage has the management indicated that it was willing to settle the matter in any other manner or meet the demand of the workers half-way. Having regard to the circumstances of the case, one is satisfied that the demand had been made and duly communicated to the management; that large body of workmen insisted upon reinstatement of the nine persons referred to in the order of reference.'
22. The whole of this passage is incorrect in point of fact so far as the case of the Prakash cotton Mills (Private), Ltd., is concerned. The industrial court has assumed that the strike which took place was a strike common to both the Sayaji Mills, Ltd., and the Prakash Cotton Mills (Private), Ltd., and basing itself upon that premise, it has held that there was a demand made and a refusal by the employers. The fact so far as the Prakash Cotton Mills (Private), Ltd., is concerned, is that there was no strike whatever after the discharge of the nine workers. It seems to us that the industrial court trying these two cases together mixed the facts of one case with the facts of the other. There was unfortunately a strike in the Sayaji Mills, Ltd., after the discharge of the five workmen by the employer and to that extent, therefore, the finding of the industrial court, so far as that mill is concerned, would be correct but we cannot possibly sustain the finding of the industrial court so far as the Prakash Cotton Mills (Private), Ltd., is concerned, because it is based upon wholly incorrect facts. The order, therefore, which the industrial Court passed so far as the Prakash Cotton Mills (Private), Ltd., is concerned, is a 'speaking order.' On the face of it, the reason given for holding that there was a dispute or difference between the employer and the employees does not exist. It was urged that there was other material and reference was made to the affidavits filed in this court and to some of the statements filed before the industrial court. It seems to us so far as the affidavits in this court are concerned, also that the statements therein are not very clear. But we need not go into them, because we do not propose to substitute our finding for what should properly be the function of the industrial court. The reason given for the finding is based on an incorrect assumption and so we cannot sustain the finding.
23. An ancillary argument in this connection was also advanced by Sri Phadke on the basis of Sub-section (2) of S. 73. Sri Phadke urged that the order of reference relies upon Sub-section (2) when it uses the words in the second paragraph thereof 'and whereas the State Government is satisfied that the said industrial dispute is not likely to be settled by other means' and that here again the reference is bad because of the non-existence of a dispute. It seems to us that this point will also turn upon the decision on the third point we have dealt with above and can only be disposed of after the industrial court has given its further findings as directed below.
24. In the view we take, we think that so far as Prakash Cotton Mills, (Private), Ltd., is concerned, the finding of the industrial court should be set aside and that court requested to reconsider the matter and come to a fresh finding. So far as the Sayaji Mills Ltd., is concerned, the fact that there was a strike based upon the demand of the workers that the five discharged workers should be reinstated was correct. That fact would well form the basis of a conclusion that there was a dispute or difference between the employer and the employees. To that extent, therefore, there was basis for the finding which the industrial court reached and to that extent that finding cannot be interfered with in a writ petition. We would, therefore, confirm that finding so far as the Sayaji Mills, Ltd., is concerned.
25. In the result, therefore, we dismiss the Special Civil Application No. 1589 of 1964 filed by the Sayaji Mills, Ltd. We allow the Special Civil Application No. 1702 of 1964 filed by the Prakash Cotton Mills (Private), Ltd., and send back the matter for fresh disposal in the light of the directions given in the order. At the request of Sri Nargolkar we make it clear that if either party wished to lead evidence, it may be permitted to do so after hearing any objection of the other party.
26. The prayer on behalf of the employees for interim relief was disposed of and the industrial court granted the workers' application and ordered that :
'each one of the two mills shall pay per month from 1 October, 1964 to each one of its discharged employees in these references, as interim relief, a sum equal to one-half of his total monthly earnings calculated by taking the average of his earnings, for a period of six months immediate prior to his discharge.'
27. Sri Phadke has challenged this order upon two principal grounds. Firstly, Sri Phadke urges that there was no power in the industrial court to grant interim relief without making an award in this respect. He relied upon a decision of the Supreme court in Hotel Imperial, New Delhi v. Hotel Workers' Union : (1959)IILLJ544SC . In that case the supreme Court was concerned with the provisions of S. 10(4) of the Industrial Disputes Act, 1947. Section 10 gives power of reference to the appropriate Government in cases of industrial disputes and Sub-section (4) thereof states :
'Where in an order referring an industrial dispute to a labour court ... under this section or in a subsequent order the appropriate Government has specified the points of dispute for adjudication, the labour court ... shall confine its adjudication to these points and matters incidental thereto.'
28. The point argued before the supreme court was whether the grant of interim relief fell within the ambit of the words 'and matters incidental thereto.' In the present case we are not governed by S. 10(4) of the Industrial Disputes Act but by the specific and special provisions contained in Ss. 119C and 119D of the Bombay Industrial Relations Act.
29. Section 119D is in the following words :
'In any proceeding before it under this Act, the industrial court, a labour court or a wage board may pass such interim orders as it may consider just and proper.'
30. It does not require anything on our part to show that the provisions of the Bombay Act are radically different from the provisions of S. 10(4) of the Industrial Disputes Act. Whatever doubt there may be upon the provisions of S. 10(4) with which the Supreme Court was concerned in the case referred to, there is in our opinion no doubt whatever that the labour court would have ample power to pass interim orders as it may consider just and proper. That is done in the present case and we think that the jurisdiction to exercise that power is clear upon the terms of the section. Some reference was made to S. 119C, but we do not think that S. 119C in any way affects the power conferred by S. 119D. This point, therefore, fails.
31. There is, however, some substance in the other point urged by Sri Phadke so far as the interim orders is concerned. No doubt the grant of interim relief is a matter within the discretion of the industrial court and if that discretion of is once exercised, this Court would be reluctant to interfere, but in the present cases, we shall presently show that the order passed by the industrial court is a speaking order and the two parts of it are somewhat conflicting. Apart from that, it is also clear that the only finding which ought to have been given has not been given. In Para. 10 the industrial court laid down the principle which would guide it in the matters of this kind in the following words :
'In a dispute relating to reinstatement or payment of back-wages, ordinarily the court would be reluctant to grant interim relief, because it would be difficult to recover the payments made in the event It is found that the employer was justified in the action taken. But, I find in the circumstances of the case, some interim relief ought to be granted. But for it, with the steep rise in the cost of living, it would be impossible for the employees to put forth a claim even if it is just. At one stage I thought that the objection to the grant of relief could be overcome by requiring that security be furnished.'
32. It is, therefore, clear that the industrial court itself felt that normally it would not grant interim relief where it would be difficult to recover payments made by the employer and that at any rate, it would grant the relief subject to security being taken in such a case. So far we think that the industrial court correctly stated that principle. But then in the next few sentences the court observed :
'Sri Nargolkar, however, contended that such a stipulation would virtually deny the fruits of relief granted, as it would be impossible for the aggrieved employees to furnish security. It appears he has overlooked the fact that the claim for relief is made not by aggrieved employees but by party II, the numerous employees who have chosen to sponsor the cause of the aggrieved. It seems to me, however, that there would be practical difficulties in obtaining security from party II consisting of numerous employees. In the circumstances of the case, I think it would be proper to grant interim relief only from 1 October, 1964.'
33. In the first part of the passage which we have just quoted it is clear that the industrial court repelled the argument of the counsel for the employees that the stipulation for security would virtually deny the fruits of relief granted by observing that counsel had overlooked the fact that the claim for relief was made not by the aggrieved employees but by party II, viz, the numerous employees who have chosen to sponsor the cause of the aggrieved. If at all this finding amounts to anything, it certainly does not amount to a finding that the employees were not able to furnish security, nor is there anything in the subsequent passages of the order to indicate that the industrial court found that the employees in the present case were unable to furnish security or that if they had been called upon to do so would inflict any substantial difficulties or hardship upon them. On the other hand, to begin with, the industrial court itself observed that normally it would not grant interim relief to the workers unless the amount payable to them was secured to the employer It seems to us that though the industrial court laid down the principle which should guide them in matters of this kind correctly it failed to implement that principle. There is no finding given that the employees were unable to furnish security or that if they had been called upon to do so it would inflict substantial difficulties or hardship upon them. In the absence of such a finding it seems to us that there is no reason indicated upon the fact of the order for passing it. On the other hand, upon the very principle stated by the Court, the passing of the order would not be justified.
34. Here again, the question arises what we should do in the circumstances. We think that these are matters which can best be dealt with by the special courts created for decisions of these matters under a special statute. We think that the proper order to pass would be to set aside this order granting interim relief and to send back the matter to be reconsidered by it in the light of the directions given. Special Civil Application No. 423 of 1965 is therefore, allowed and the question of interim relief is ordered to be reconsidered by the industrial court. The matter should be dealt with expeditiously. There shall be no order as to costs so far as the petition No. 1702 of 1964 of the Prakash Cotton Mills (Private), Ltd., is concerned. So far as the Sayaji Mills, Ltd., is concerned, they have fully failed in Special Civil Application No. 1589 of 1964 and we think that they should pay the costs of the State Government, respondent 5, but since, so far as the workers are concerned, success and failure have been equal in the two special applications filed, there shall be no other order as to costs.