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Engineering Mazdoor Sabha Vs. the Registrar of Trade Unions - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtMumbai High Court
Decided On
Case Number Special Civil Application No. 4282 of 1976
Judge
Reported in(1979)81BOMLR139; 1977MhLJ825
AppellantEngineering Mazdoor Sabha
RespondentThe Registrar of Trade Unions
DispositionPetition allowed
Excerpt:
trade unions act (16 of 1926), sections 28 and 28-1a-bombay trade unions regulations, 1927, regs. 12 and 23-maharashtra recognition, of trade unions and prevention of unfair labour practices act (mah. i of 1972), section 19(iv)-amendments in rules of union necessary to comply statutory requirements of section 19 of the maharashtra trade unions and prevention of unfair labour practices act regarding appointment of auditors appointed by the state government-amendments passed at meeting of general council of the union-refusal of registrar of trade unions to register the amendments on the ground that a dispute had been raised regarding election of office bearers of the union and that the meeting of the general council held at the instance of such office bearers is not a validly called..........a registered trade union, seeks directions requiring respondent no. 1, the registrar of trade unions, to register certain amendments in the rules of the union, sanctioned and passed in the general council meeting dated january 17, 1976.2. the facts that require to be remembered for the purpose of understanding the main prayer in the writ petition are these. the petitioner is engineering mazdoor sabha, a trade union registered under the trade unions act, 1926 sometime in the year 1947. it represents the employees in the entire engineering industry in -greater bombay. it has a constitution and rules which are produced at annexure 'a' to the petition. as per those rules the trade union was functioning; all along and was submitting regularly all the annual returns etc. to the.....
Judgment:

Deshmukh, J.

1. By this writ petition, the petitioner, a registered trade union, seeks directions requiring respondent No. 1, the Registrar of Trade Unions, to register certain amendments in the Rules of the union, sanctioned and passed in the General Council meeting dated January 17, 1976.

2. The facts that require to be remembered for the purpose of understanding the main prayer in the writ petition are these. The petitioner is Engineering Mazdoor Sabha, a trade union registered under the Trade Unions Act, 1926 sometime in the year 1947. It represents the employees in the entire engineering industry in -Greater Bombay. It has a constitution and Rules which are produced at Annexure 'A' to the petition. As per those Rules the trade union was functioning; all along and was submitting regularly all the annual returns etc. to the Registrar of Trade Unions under Section 28 of the Trade Unions Act, 1926.

3. The petitioner union has a General Council which is constituted by all members of the factory committees representing the various units covered by the Engineering Industry. This General Council is in the position of a general body of the trade union and this General Council has to meet at least once annually where all statements of accounts are passed and office bearers elected. Recently there has been a change in the constitution by which the election of the office bearers is for three years instead of one year. As per Rules of the union a notice was issued by the president of the union dated April 28, 1975 calling a meeting of the General Council on May 5, 1975. The General Council meeting was held on May 5, 1975 when a review of the previous year's work was taken, accounts passed and office bearers were elected. Certain amendments were passed in that meeting, which were already notified in the agenda.

4. As required by the provisions of the Trade Unions Act, 1926 the amendments are to be notified to the Registrar within fifteen days from the date of the meeting of the General Council which adopted the amendments. That was done in this case by the secretary's letter dated May 10, 1975. It appears that after being satisfied as required by the provisions of Section 28 of the Trade Unions Act or in fact not having any reason to doubt that the Rules of the union are not observed or the amendments are contrary to the provisions of the Act, the Registrar, respondent No. 1, registered the amendments on July 28, 1975. A communication informing the union of the same was sent by him on July 31, 1975.

5. There was another meeting of the General Council on November 6, 1975, but that is of no relevance so far as the present dispute is concerned. A further meeting of the General Council was held on January 17, 1976. A notice regarding that meeting was issued on January 9, 1976 giving clear seven days' notice to all the members of the General Council. The notice for the meeting also contained the agenda. One of the items on the agenda was the amendment of the constitution by making various changes and more particularly by adding a provision permitting the auditor appointed by the State Government to audit the accounts of the union at least once in each financial year. Such an amendment became necessary because of the provisions of Section 19 of the Maharashtra Recognition of Trade Union and Prevention of Unfair Labour Practices Act, 1971 (hereinafter referred to as the 'Act of 1971'). This Act of 1971 prescribes a procedure for a union being recognised and that is included in Section 12. For that purpose a union desirous of seeking recognition has to apply 'and before the union qualifies itself to be recognised under this Act, it has also to comply with certain statutory requirements regarding the Rules of the union. Section 19 of the Act of 1971 says that Rules under this Act shall provide for certain matters enumerated in Clauses (i) to (IV). Clause (iv) says that the Rules must contain a provision that an auditor appointed by the State Government may audit its accounts at least .once in each financial year.

6. The petitioner union represents several units of Engineering Industry and is desirous of obtaining the status of a recognised union. It has applied under Section 12 in respect of many units and it wanted to comply with all the statutory requirements in that behalf. Consistent with this object, the union passed an amendment incorporating the provisions of Clause (iv) of Section 19 in its meeting dated January 17, 1976. It is not necessary to give detailed reference to the various other amendments proposed and passed in that meeting. Our further discussion, will indicate that there exists only one objection as to why respondent No. 1 has not yet thought it fit to register the amendments sent to him within time by appropriate officer of the union, That being so, the contents of the amendments is not a subject-matter of dispute, but the manner of passing them alone being the disputed question, detailed reference to the amendments as such is not necessary.

7. These amendments were immediately communicated to the Registrar as required by Section 28(3) of the Trade Unions Act, 1926 under the signature of the secretary as is provided by the Rules of the union. This was done on January 28, 1976. Nothing was heard from the Registrar for about three to four months and the petitioner union being restive to obtain recognition under the 1971 Act sent a letter by way of reminder to respondent No. 1 dated May 4, 1976. There was no response. Another reminder was sent on May 14, 1976 and a third one on May 23, 1976. Ultimately, by his communication dated June 21, 1976 respondent No. 1 wrote to- the union that there exists a dispute between the office bearers of the said union and hence the amendments proposed by the union cannot be registered at that stage.

8. Having received this reply, the petitioner union applied to the Commissioner of Labour, requesting him to register, if not all at least the amendment enabling the Government auditor to audit the accounts of the union at least once a year as such an amendment was absolutely must for the purpose of obtaining recognition under the Act of 1971. However, the petitioner never received any direct reply from the Commissioner of Labour, who merely forwarded that letter to respondent No. 1 for the purpose of disposal. Since no reply was received for almost one month, present petition came to be filed in this Court on July 27, 1976, Somehow the petitioner received a communication having the same date, viz. July 27, 1976, from respondent No. 1 which reiterates the same stand which was earlier taken.

9. This letter is slightly more detailed and tells the union that some two members have raised a dispute challenging the legality of the meeting dated May 5, 1975 and the election of the office bearers in that meeting. A consent certificate has been issued by respondent No. 1 under Section 28-1A of the Trade Unions Act, 1926 and the said matter is pending in the Industrial Court for decision. In the circumstances it will not be possible to register the amendments to the constitution notified by the General secretary of the Sabha at that stage. There is something wanting in the last sentence, but the implication seems to be that the very legal existence of the Sabha itself and its office bearers being in jeopardy in view of the election dispute pending in the Industrial Court, the Registrar is unable to register the amendments proposed by the secretary as per the resolution adopted in the meeting dated January 17, 1976.

10. By way of reply to the present petition, respondent No. 1 has raised the same defence. According to him when the communication was received from the union earlier in relation to its meeting dated May 5, 1975, he registered the amendments as required by Section 28(3). He was not aware at that stage of any dispute regarding the validity of the election of the office bearers. Order registering the amendments was passed on July 28, 1975, and thereafter on the next day an application was received from two persons under Section 28-1A for a certificate under Reg. 23 of the Bombay Trade Unions Regulations, 1927. Respondent No. 1 called both the parties and gave them hearing about that dispute. He heard the parties for a quite some time on various dates between September 3, 1975 and December 11, 1975. Ultimately he issued the certificate under Reg. 23 read with Section 28-1A on December 29, 1975. In pursuance of that certificate, the two applicants before respondent No. 1 have raised a dispute before the Industrial Court, which is pending.

11. According to respondent No. 1, since the validity of the constitution of the office bearers was hanging balance in that dispute, he assumed that until that dispute is finally decided the office bearers elected in the meeting of May 5, 1975, could not be treated as lawful office bearers of the union. In that view of the matter a meeting of the General Council held at the instance of such office bearers as secretary or president is not a validly called meeting. If the meeting dated January 17, 1976 is not the valid meeting at all under the Rules of the union, respondent No. 1 was within his rights in refusing to register the amendments in view of the powers vested in him under Sub-section (3) of Section 28 read with .Reg. 12 of the. Bombay Trade Unions Regulations, 1927. He has denied, though .in a cryptic manner, the allegations of legal as well as factual mala fides. According to him, since he interpreted the provisions in the manner stated above, it would not be possible to grant registration of amendments until the election dispute was finally disposed of.

12. It is, therefore, necessary to decide the nature of the right or duty which the Registrar has to perform under Section 28(3) of the -Trade -Unions Act, 1926 read with Reg. 12 of the said 1927 Regulations. It would also be necessary to examine the effect of the consent certificate issued by the Registrar under Sub-section (1) of Section 28-1A of the Trade Unions Act, 1926 read with Reg. 23 of the said 1927 Regulations. In our view, normally it is the duty of the Registrar to effect changes in the constitution of a union as per documents received under Sub-section (3) of Section 28 of the Trade Unions Act, 1926. It is true that under certain circumstances he can refuse to effect the changes. What he is called upon to do is to satisfy himself that the amendments have been brought about in the manner prescribed by the Rules of the union and that they are in accordance with the provisions of the Act, viz. the Trade Unions Act. Primarily an obligation has been created under which the appropriate officer of the union: must . notify to the Registrar all alterations in the Rules within fifteen days of the making of the alterations. No time limit has been fixed under any of these provisions for the Registrar to register those amendments. However, it must be assumed that he must act within reasonable time of the receipt of the alterations in the Rules. Sub-sections (1) and (2) of Section 28 refer to other documents which are to be sent to the Registrar on or before the date prescribed. A general statement of accounts audited in the prescribed manner covering all receipts and expenditure etc. and a statement of assets and liabilities of the trade union has to be sent to the Registrar. This is all that is stated in the substantive provisions of Section 28.

13. The Trade Unions Regulations of 1927 have been prepared for giving effect to the provisions of the Trade Unions Act, 1926. Since the Registrar has very little right to interfere with the internal working of the trade union, the language -of Reg. 12 has been specially so designed as to emphasise the duty of the Registrar to register the changes rather than to raise unnecessary questions. Regulation 12 says that after 'receiving a copy of any alteration made in the rules of a trade union under Sub-section (5) of Section 28, the Registrar shall register the alteration in a register to be maintained for this purpose and shall notify the fact that Tie has done so to the secretary of the Trade Union.' We have quoted the Regulation except the intervening clause, which says that he may not do so unless he has reason to believe that the alteration has not been made in the manner provided by the rules of the trade union or unless the alteration is not in accordance with the provisions of the Act. In the case of these two exceptions, viz. the procedure for making alterations about the amendments of the Rules not being followed and the proposed amendments being contrary to the provisions of the Trade Unions Act, the Registrar may refuse to register the alteration. Short of this, it is his duty to register and therefore the section has been so constructed as we quoted above without the intervening clause.

14. So far as the present case is concerned, the Registrar does not say that the alterations are not in accordance with the provisions of the Act. We need not, therefore, pursue that point. On the contrary we shall assume that the amendments notified to the Registrar are in consonance with the provisions of the Act. What is being emphasised by Mr. Kanade, counsel for the respondents, is that the objection falls in the first part of the intervening clause, viz. that the alterations have not been brought about in the manner provided by the rules of the trade union. What precisely is the implication of the clause must be clarified.

15. It may now be noted that for the purpose of satisfying himself whether the union has acted according to its own Rules and whether the documents furnished under Sub-sections (1),(2) and (3) of Section 28 are in order, the Registrar has been vested with certain powers under Sub-section (4) of Section 28. That sub-section says that for the purpose, of examining the documents referred to in Sub-sections (1), (2) and (3) the Registrar, or any officer authorised by him, by general or special order, may at all reasonable times inspect the certificate of registration, account books, registers, and other documents, relating to a, trade union, at its registered office or may require their production at such place as he may specify in this, behalf, but no such place shall be at a distance of more than ten miles from the registered office of a trade union. Expectation therefore is that ordinarily the Registrar or his nominee will visit the office of the union and inspect the documents or may call upon them to produce the document at a convenient place within ten miles from the location of the office of the trade union. This examination is to be done only to verify if he has any doubts whether the documents are in order and the provisions of the rules of the union have been observed.

16. The main clause in Reg. 12 is 'unless he has reason to believe that the alteration has not been made in the manner provided by the rules of the Trade Union.' The expression 'having reason to believe' is a strong one. It is not enough that the Registrar merely entertains some suspicion. He must have prima facie proof that the manner provided by the Rules of the trade union has not been followed in making alterations in the constitution of the rules. The language used in the Reg. 12 clearly says that the Registrar has to look at the rules of the union and ascertain the manner provided for the purpose of effecting the amendments in the constitution. The rules produced along with the petition at annexure 'A' do indicate the manner in which the amendments to the rules can be brought about. Rule 46 in that behalf is relevant. It says that the rules may be amended, altered, replaced, rescinded or added to at any. time by a majority of the members present and voting at a meeting of the General Council provided previous notice of at least seven days in given to the members of the proposed alterations.

17. By looking to those Rules the Registrar has to find out whether a notice as contemplated by the Rules of the union has been issued notifying the members the proposed changes and whether at least seven days' notice has been given as required by Rule 46. If a General Council meeting is held after issuance of such a notice and the proceedings maintained in respect of that meeting show that majority of the members present have opted in favour of the alterations the Registrar must register the alterations and is left with no choice. It is precisely for this purpose that Sub-section (4) of Section 28 of the Trade Unions Act, 1926 has been enacted to authorise and enable the Registrar to examine the proceedings and documents of the trade union. It may be noted that the added Section 28-1A provides for raising a dispute whether a particular member is an office bearer or not of the registered trade union, including dispute whether the member has been wrongfully expelled from the membership or the office of a trade union. It also permits .disputes to be raised regarding property of the union including account books at the instance of a person who has been a member of the registered trade union for a period of not less than six months. However, he has to raise such a dispute with the prior consent of the Registrar and also in the manner prescribed. This added section requires the Registrar now to entertain an application at the instance of a member for raising a dispute contemplated by Sub-section (1) of Section 28-1A and before issuance of his consent certificate, he has to follow the procedure laid down in Reg. 23 of the 1927 Regulations.

18. It does appear that some two persons applied to the Registrar and after following the procedure under Reg. 23, the Registrar issued the consent certificate. A complaint has been lodged on the basis of the consent certificate, which is pending before the Industrial Court. We may incidentally mention that the grant of the certificate itself is under challenge. The union moved this Court by way of Spl. C. A. No. 753/76 for quashing the certificate. That petition was summarily rejected by this Court. An appeal has been filed before the Supreme Court and Special Leave has been granted by that Court. In that appeal the union has asked for staying the proceedings of the complaint before the Industrial Court. We are told that after issuing notices and after hearing the parties, vi?. the two complainants as well as the union, the Supreme Court has granted stay of that complaint. The operation of the consent certificate itself is stayed which undoubtedly has the effect of stopping further proceedings regarding the dispute raised before the Industrial Court. These facts have been mentioned by us as they were stated by the parties but in our view they are strictly not relevant for deciding the point which really arises in this writ petition. Granting of the consent certificate may be quashed by the Supreme Court in which case no dispute will really survive which is sought to be raised by those members. Even assuming however, that the appeal before the Supreme Court fails and the dispute in the Industrial Court proceeds ahead regarding the holding of office by the certain office bearers of the union, that result may ultimately end in favour of the two disputants or may result in favour of the union. However, none of these consequences really seem to be relevant for the main point, which we are called upon to decide.

19. The registration of the alterations received under Sub-section (5) of Section 28 of the Trade Unions Act, 1926 was to be made by the Registrar unless he has reason to believe that the alterations have not been made in the manner provided by the rules. He has merely to examine the manner in which changes have been brought about and the moment he finds that there has been compliance with the requisite rules by which change is to be brought about, he has no option but to register alterations. The main point raised by Mr. Kanade on behalf of the Registrar for our consideration is that a consent certificate has been awarded by the Registrar under Reg. 23 read with Section 28-1A of the Trade Unions Act. When such a consent certificate is given does it not mean that the Registrar has now reason to believe that the alterations have not been, made in the manner provided by the rules? Mr. Kanade argued that the election of certain office bearers in the General Council meeting dated May 5, 1975 is being challenged. It is that dispute for which a consent certificate has been given. Does it not mean therefore that a doubt has been now created about the valid election of the office bearers of the petitioner union in its General Council meeting dated May 5, 1975? Proceeding further he says that if this is a correct logic, then the legal status of the office bearers of the petitioner union is in doubt. If either the president or the secretary so elected issues a notice for holding a General Council meeting dated January 17, 1977, could it be said to be a meeting lawfully held according to the procedure laid down by the rules of the trade union? It is on this approach that the Registrar has stayed his hands from registering the changes received by him. It is not the say of the Registrar that he has not received the changes within the time prescribed nor prima facie from an officer who purports to be the general secretary of that union. However, it is the granting of the certificate which has actually led to the raising of a dispute before the Industrial Court, that has, deterred the Registrar from acting under Reg. 12 read with Section 28(3). No other objection is raised for registering those changes.

20. It is precisely here that this Court must point out the difference between the provisions of Section 28 of the Trade Unions Act read with Reg. 12 find the provisions of the added Section 28-1A read with Reg. 23. The field of operation of these two provisions is distinct and different. It may be that the Registrar has, to issue ;a consent certificate without which a dispute contemplated by Sub-section (1) of Section 28-1A of the Trade Unions Act could not be raised at all. However, the examination required to be made is only for the purpose of finding whether a dispute exists. The Registrar has not to go deep and decide whether that dispute has really such substance that it may ultimately succeed. The only idea of the Legislature seems to be that the Industrial Court should not be flooded with frivolous disputes and there should be some kind of prior checking by experienced officer of Government before a dispute is allowed to be raised. It may be noted that because a dispute is raised, as many disputes are raised in various litigations under various Acts they do not have ipso facto effect of affecting the proceedings of the various bodies whose existence is challenged. If an election is in dispute, as in the present case, and the disputants wanted that the persons wrongfully elected to certain office should not function, they have a right to apply to the Industrial Court for interim relief. The proviso to Sub-section (2) of Section 28-1A provides that the Industrial Court may pending the decision of the dispute make an interim order specifying or appointing any person or appointing a Committee of Administration for any purpose under the Act including the purpose of taking possession or control of the property in dispute and managing it for the purpose of the union pending the decision. In other words, the existence of the union and its officers as also carrying out the activities of the union is not to be hampered but instead of regularly elected persons, an Administrator may conduct the affairs of the union. Implicit, therefore, is the intention of the Legislature that where no interim relief has been granted as provided by proviso to Sub-section (2) of Section 28-1A, the activities of the union must be deemed to continue in the normal course. It is this aspect of the matter which has been lost sight of by the Registrar. He is not made an officer for the purpose of deciding a dispute under Section 28-1A. The fact that the election is under challenge and the Registrar has issued a certificate makes him think that he was treating the elected body as if an unlawful body and every action taken by that body later on is non est in law. This is going too far and the Registrar has not been vested with any such power and advisedly so by the Legislature.

21. It is the Industrial Court which will not only entertain a dispute but will also pass appropriate interim orders depending upon the facts and circumstances presented before it. Until, therefore, any such order is passed for that purpose under Section 28 read with Reg. 12, the Registrar will merely examine whether prima jade a notice has been issued, whether it is seven days' notice and the minutes of the proceedings of the General Council show that certain changes have been effected by majority of votes of those who were present. We may note that the disputants have not moved the Industrial Court at all for any interim orders till now.

22.We are, therefore, satisfied that the Registrar has confused his function under Section 28 of the Trade Unions Act, 1926 read with Reg. 12 of the 1971 Regulations with his distinctly different function under Section 28-1A read with Reg. 23. We have already stated earlier that the Registrar has not raised any other objection to the registration of the alteration except that an election dispute exists which may in the long run declare the election of certain office bearers as unlawful. It is well known that where no stay is granted the proceedings of the body are to be deemed to be lawful, and if the status of some persons as elected representatives is set aside the effect will be prospective and not retrospective.

23.In this view of the matter, we are satisfied that the Registrar had no reason to believe that the alteration was not made in the manner as provided by the Rules of the trade union nor was the alteration in accordance with the provisions of the Act. The Registrar was, in the circumstances, bound to register the alterations and his refusing to register them for all this time is clearly unlawful and amounts to failure of duty. We, therefore, direct the Registrar to' register the amendments received by him from the petitioner union under letter dated January 28, 1976, exh. B to the petition. Since registering of these alterations have been unlawfully withheld from January 1976 when they should have been made within reasonable time after the receipt of the letter, and since they are likely to affect materially the petitioner union in several other industrial matters, we also think that it is necessary to direct him to register these alterations with effect from February 1976.

24. Petition thus succeeds and is allowed. Rule made absolute with costs.


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