Somnath Iyer, J.
1. This application concerns a reference made by the State Government on January 22, 1959, under the provisionary of Sections 10(1)(c) of the Industrial Disputes Act, referring to the Labour Court the following dispute:
'Is the Management of ?Desi Textile Mills Bangalore plaintiff in dismissing all the workmen of the Factory as a sequel to the stay-on-strike on 22-10-1955? If not, whether the workmen are entitled to reinstatement or any other relief?'
The Desi Textile Mills referred to in this reference is the petitioner before us. It was the owner of a silk industry employing 150 workmen. Its case is that in the year 1955, as a result of certain losses sustained by it, It stopped the payment of certain bonuses in respect of which there was a demand made by the workers who, on October 22, 1955, commenced a stay-in-strike by reason of the demand having been repudiated. That strike came to an end. But on October 22, 1955, the peer terminated the services of 132 of those 150 workmen. This termination gave rise to an industrial dispute within the meaning of that expression occurring in section 2(k) of the Industrial Disputes Act.
(2) By about May 14, 1956, there was a general closure of all silk industries in the City of Bangalore which made intervention by the State Government necessary. There was a meeting of the representatives of the various workers of the industries, the representatives of the owners of those industries and the concerned. Minister of which attempts care made to resolve the differences between the workmen and the management. On June 23 and 25, 1956, an agreement was reached at what has been described by the State Government in the affidavit produced in this case as a tripartite conference in which the aforesaid workers, the representatives of the industries and the representatives of the Government6 participated.
(3) According to the petitioner the industrial dispute among out of the termination of 132 workmen by it, stood resolved and settled by of the settlement reached that way. It is therefore contended that the reference made by the State Government to the Labour Court on January 22, 1959, referring to that Court a dispute which no longer existed but which had been settled finally by agreement of parties, is one made within jurisdiction or authority and therefore, liable to be quashed. The petitioner also asks us to restrained in the Labour Court from proceedings to make its adjudication on that reference. It is also further contended that we should quash the reference made by the State Government on the ground that though is an extremely Stale reference relating to a dispute which came into exist as long ago as the year 1955.
(4) The first question which arises for decision is whether as contended by the petitioner, the dispute which found the subject matter of the reference made by the ?State Government had not in fact stood resolving and settled by the agreement reached on June 23 and 25, 1956 at the tripartite conference alluded to by the State Government in its affidavit. That question becomes important since. If on the date on which the impugned reference was made by the State Government no industrial dispute was in existence. If there was no ground for any apprehension in the mind of State Government that such an industrial dispute was likely to come into existence, it would not have been within the competition of the State Government to make a reference under section 10(1) of the Act.
(5) It is not disputed and in my opinion, very properly - by Mr. Narasimha Murthy that the dispute referred to in the impugned reference is an industrial dispute within the meaning of section 2(k) of the industrial Disputes Act. But it has been argued before is that even though the dispute cases into existence on October 22, 1955 when the 132 workers were discharged that dispute owned to exist by reason of the settlement between the workmen and the petitioner.
(6) The material on which the argument that the dispute was settled at a tripartite conference is what is contained in a record of the agreement reached at that conference. It is not disputed by the respondents that a tripartite conference was held on June 23 and 25, 1956 and that many matters in controversy between the workmen and the management of the various industries were settled a6 that conference by agreement of parties. The question is whether thee dispute retaining to the termination of the services of the 132 workers who were discharged on October 22, 1955, also stood settled at that conference.
(7) Clauses 5 and 7 of the agreement worked at that conference are pointed out to us by Mr. Narasimha Murthy for the petitioner as the clauses recording the settlement in respect of the termination of the petitioner workmen. Now, these two clauses which are material for our present purpose, and on whose interpretation the decision of the question arising in this case depends read:
'Clause 5: Both the parties agree that the case of dismissed shall also he referred to arbitration and abide by its decision as stated in, Para 3 supra. All employments dismissed-discharged shall be immediately taken back to work, except in respect of Desi Textile, who shall take only such number as could be absorbed for one shift only. Such if those employees as are already in employment, shall be terminated by payment of one month's wages in lieu of notice in the case of permanent one, and notice in the case of temporary employees'.
'Clause 7. The employees in the industry including Desi Textiles, who have now closed the factories shall reopen and the employees representatives shall came to withdraw all cases pending before the industrial Tribunal'.
It is clear from these portions of the record of the settlement reached between the parties that the clauses referred to its draft agreement, prepared it some earlier stage and that the settlement reached between the parties is what is incorporated, in what is deserved its the decisions appearing under each or these clauses. It will be clear from these decisions that what was settled between the parties in respect of the dismissal of the workers of the various industries was that in the case or every other industry certain workers who had to be selected by the respective Unions had to be reinstated on terms and conditions set out in the decision appearing under clause 5. It was also agreed that the cases of workers not so selected by the respective Unions should e examined and decided by the Board of Conciliation on merits. In other words, it was agreed between the parties that it would be open to the management in each industry title re-employ certain member of workmen selected by the respective Union and that those who were not so selected by the respective Unions might pursue their remedies by what is described as an arbitration by the Board of Conciliation.
But, as expressly mentioned in this part of the agreement, the reinstatement of the workers of the petitioner's silk industry was selected for special treatment and what was agreed in regard to the worker's of the petitioner's industry is what is appearing under clause 7 and that part of the agreement reads:
' The Proprietor of the Desi Textiles submitted that his factory did not close along with the general closure on 14th May 1956, but, it is remaining closed since October last, the dispute in this connection being before Government. He wanted a month's time to reopen its factory and work one shift. It was agreed that he should reopen the factory by the 15th of July 1956, for one shift and that if such reopening was not possible on that day he could be given a few day's extension of time, on his applying for it with reasons, and that except the basic reference regarding the revision of wages and other amenities the other proceedings will not be applicable to his factory'.
(8) There was thus a clear contract between the agreement reached in respect of the reinstatement of the workers if the other industries and that reached in regard to the reinstatement of the workers of the petitioner's industry. It was open, recording to the agreement, to the peer to re-employ only those workmen whom he would require for the operation of only one shift, it being obvious that it was agreed between all the parties that it would not be possible for the petitioner to work more than one shift. While in respect of the workmen of the industries not selected by the respective Unions those workmen were given the liberty to have their cases examined and decided in arbitration, no such liberty was given to the workmen not re-employed or reinstated by the petitioner's industry.
What the petitioner in effect became entitled to do under the agreement was to reinstate only number of workmen necessary for him to operation only one shift, it being not necessary for him to reinstate the others who had been already discharged. The only meaning which we can give to these portions of the agreement reached between the parties as so far as it related to the petitioner's industry is that a final agreement was attached at the tripartite conference in which the workmen of the petitioner's industry were also properly represented, that the question whether any of the petitioner's workmen had been improperly or illegally dismissed should no longer he made the subject matter of any further enquiry or investigation and that the industrial dispute resulting from such termination should stand resolved on the petitioner undertaking to reinstate such number or workmen as would be necessary for him to operate one shift.
If that was the agreement reached, I fail to understand how it could be contended that the industrial dispute which came into existence when the petitioner's workmen were discharged or dismissed, on 20-10-1955, to any extent survived after a settlement was reached in that way. If a person dismisses his workmen and a dispute arises whether the dismissed by him was or was not legal and during the investigation into that dispute the dismissed workmen and the employer reach an agreement that it would be enough for the employer to reinstate only some of those workmen whom he had dismissed, the agreement to reached can mean nothing else than that was the way in which the dispute arising out of the dismissal of the workmen should be decided and settled.
(9) But Mr. Nagesha Rao appearing for Respondent, 2 who are the workmen of the petitioner's silk industry and Mr. Government Pleader appearing on behalf of respondent 1, the State Government contended that the formula reached at the tripartite conference was only an interim arrangement arrived at between the parties without in any manner finally settling the dispute relating to the termination of the petitioner's employees to ensure their remedies such as might of ne available to them under the law in respect of the illegal termination of their services. It seems to me that to place that interpretation on the provisions of the decision appearing under clauses 5 and 7 of the agreement referred to would be going altogether too far than what their plain language justifies.
The contrast between the provisions relation to the other industries and those relating to the petitioner's industry makes it in any opinion perfectly manifest that the entire dispute relating to the termination of the petitioner's workmen stood resolved and settled by the agreement reached at the tripartite conference. After that agreement was reached, it was impossible for any other worker not reinstated to contend that he also should have been reinstated or that its dismissed on October 22, 1955 was an illegal dismissed.
(10) Mr. Nagesha Rao, however, placed reliance upon the provision of clause 5 of the draft agreement which provided for the reference to arbitration of all cases of dismissed. The contention urged was that even the cases of those workmen of the petitioner's industry who were not reinstated for the one shift which he undertook to operate. Half to be referred to arbitration under this provision of the draft agreement.
This argument, in my opinion, overlooks the fact that the provisions of the draft agreement under went a substantial change when the final agreement was reached between the parties and that final agreement is what is recorded. Under clauses 5 and 7 and when one looks into those portions of the agreement reached between the parties, it would be impossible for anyone to resist the conclusion that it was far from the mind of anyone that workmen other than those reinstated by the petitioner for the one shift which he undertook to operate should have the right to have these cases decided by arbitration.
(11) I actual also of the view that even clause 5 of the draft agreement does not on its proper construction support the contention of Mr. Nagesha Rao. It terms to mentioned that on a true interpretation of that clause the cases which had to be referred to arbitration were cases of workmen of the petitioner's industry, in whose case, as I have already mentioned, a special provision was made.
(12) It will also be seen from what appears under clause 7 of the draft agreement that the only matter in regard to which the petitioner's workmen had a right to pursue other remedies was that relating to revision of wages and amenities. The words, 'other proceedings will not be applicable to his factory's appearing in that part of the agreement place the matter beyond all doubt.
(13) We should , in my opinion, therefore held that the question which was refereed by the State Government to the Labour Court was fully settled at the tripartite continence at which the parties settled many of their differences on June 23 and 25, 1956. That being the position, it would ordinarily follow that the industrial dispute which came into existence by reason of the termination of the petitioner's workmen in the year 1955, came to an end and was removed by the settlement to reached.
(14) Section 10(1)(c) of the Industrial Disputes Act reads:
'10 (1) Where the appropriate Government is of opinion that any industrial dispute exists or is apprehended, it may at any time, by order to writing :
(C) refer the dispute or any matter appearing to be connected with or relevant to the dispute, if it relates to any matter specified in the second Schedule, to a Labour Court for adjudication'.
It is under the provisions of this clause of Section 10(1) that the impugned reference was made by the State Government in this case. It is clear that reference would not have been possible unless an industrial dispute at the time the reference was made existed or watan apprehended. It is not the case of any one that the State Government when it made the impugned reference, apprehended an industrial dispute between the petitioner and its workmen, It is obvious that it made a reference because, in its opinion, an industrial dispute existed. If the industrial dispute between the petitioner and its workmen no longer existed, it is clear that it was not writing the competence of the state Government to make a reference under Section 10(1)(c) of the Act.
(15) By reason of the conclusion reached by mentioned that the dispute between the petitioner and its workmen stood resolved on June 23 nd25, 1956, reference made by the State Government in this case would have to be pronounced as one made without authority. But Mr. Nagesha Rao has however ground on as the point of view that since the settlement reached between the parties watan a private settlement functioning under the Industrial Disputes Acts the industrial dispute which admittedly came into existence on October 22, 1955 must still be regarded as confirming to exist without having disappeared or come to an end.
Mr. Nagesha Rao urged that the only method by which an industrial dispute, if it comes into existence can stand settled us, either by a conciliation or by an award and that was the portions want the definition of 'Settlement' occurring in Section 2(p) of the Industrial Disputes Act was amended on August 28, 1956. Section 2(p) before its amendment which came into force on August 28, 1956, defined a 'Settlement' as hereunder :
'(p) 'Settlement' means a settlement arrived at in the course of a conciliation proceeding'.
That clause of Section 2 after its amendment reads :
'(p)' 'Settlement' means a settlement served at in the course of conciliation proceeding and includes a written agreement between the employee and workmen arrived to otherwise than in the course of conciliation proceeding where such agreement has been signed by the parties thereto in such manner as may be prescribed and a copy thereof has been sent to the appropriate Government and the conciliation officer'.
The argument advance is that section 19 of the Industrial Disputes Act specifies the period, during which a settlement as defined by section 2(p) of the Act operates and that it is clear that the settlement referred to in Section 19, until Section 2(p) was amended would only be a settlement arrived at in the course of conciliation proceedings. The settlement on which the petitioner depends in this case not being a settlement arrived at in conciliation proceeding and being one which was arrived at before Section 2(p) was amended it is clear, that settlement was see governed by the provisions of Section 19 of the Industrial Disputes Act. On and from August 28, 1956 on which date Section 2(p) was amended, a private settlement, although arrived at without the intervention of a conciliation officer would nevertheless, he governed by the provisions of section 19. So for Mr. Nagesha Rao if quite right in submitting by us that the settlement, arrived as at the tripartite conference in this case was not one to which Section 19 of the Industrial Disputes Act was applicable.
(16) But the fact the Section was no applicable to that private settlement can be of little assistance to Mr. Nagesha Rao who cannot in my opinion, derive any sustenance to the argument that settlement did not being to an end the industrial dispute between the petitioner and it workmen. It is one thing in my opinion to say that a settlement is not governed by Section 19 of the Industrial Disputes Act and quite another thing to say that a settlement to which S. 19 is not applicable does not terminate an industrial dispute.
There might be a settlement not arrived at as a result of conciliation and therefore does not fall within section 19 but nevertheless, ends an industrial dispute Act or in Section 2(p) of that Act as it stood before its amendment, which justifies the view that settlement not falling within section 19 does not end in industrial dispute. The only purpose of Section 19 is to fix the period of operation of settlement falling within the definition contained in section 2(p) . That section does not limit the scope of effect of settlements other than those arrived at in conciliation proceedings.
(17) There case , in my opinion, be no justification for the view that a settlement not falling within section 19 cannot and does not terminate on industrial dispute. A dispute as ordinarily understood, is a controversy or a difference of opinion between one person and another. The word 'dispute' occurring in the expression 'Industrial dispute' has to be given, in my opinion, that ordinary meaning although the expression, 'Industrial dispute' has a technical meaning given to it by the definition contained in Section 2(k) of the Act.
That being the position, it is only if a controversy or difference of opinion between two disputants exists or is apprehended on the day on which the State Government proposes to make a reference that such reference could be made. If the controversy though a controversy relating to an industry and therefore is an industrial disputes ceases to exist and has come to an end by reason of a private settlement reached between the workmen and the employer which is not prohibited by anything contained in they industrial disputes Act, it would in my opinion, be impossible for anyone to suggest that the Industrial dispute through resolved privately and without the intercession of a conciliation officer must still be regarded to be in existence rendering necessary a reference under section 10(1)(c) of making it permissible.
I can conceive of so principle on the basis of which we should intercept section 10(1) of the industrial disputes act as permitting or enabling a reference under its provisions by the State Government even in cases in which although an industrial disputes has not been settled though the mediation of the conciliation officer has nevertheless been settled by the parties themselves privately. It would be altogether unmeaning and unreasonable for the State Government to make a reference under Section 10(1) in respect of a dispute in which a settlement has been reached though not in conciliation proceedings. It would be difficult to understand what occasion can there be other a State Government to make a reference in such a situation.
(18) It is true that the object of the Industrial Disputes Act is the establishment of Industrial peace. But Industrial peace cannot only he achieved in conciliation proceedings but also to the parties themselves without the intervention of any conciliation officer, If Industrial peace is brought about by the parties themselves, can it still be said that because the source of that industrial peace is a settlement reached by the parties themselves and not a conciliation proceedings, it is no industrial peace for the purposes of the industrial disputes Act? In my opinion, the answer to that question cannot but be in the negative.
(19) Any other view would lead, in my opinion, to many incongruous results. If an industrial dispute is settled between parties privately and that settlement, as contended by Mr. Nagesha Rao does not and the dispute but keeps it pending. It would , in the first instance, lead to the anomalous result that in spite of the fact that the parties themselves settled the dispute, it would be the statutory duty of a conciliation officer under section 12 to held conciliation proceedings in a matter which had already been settled between the parties.
Section 12(1) directs that where an industrial dispute 'exists or is apprehended', the conciliation officer shall hold conciliation proceedings in the prescribed manner. The opening words in Section 12 ate the same as the opening words of section 10 in regard to the existence of tan industrial dispute or an apprehension about it. If a conciliation proceeding becomes unnecessary as in my opinion, it should, if after the industrial dispute arises that dispute is properly settled, there is no reason why we should take a different view and hold that such private settlement dies not prohibit a reference under section 10(1)(c).
(20) A contrary view would lead to the strange result that in a matter which is to longer the subject matter of a controversy between the parties, an award has to be made under Sec. 15 of the industrial dispute Act which becomes enforceable on the day specified in Section 17A of the Act,. All these proceedings, in my opinion, should be purposeless involving wasteful expenditure of public time and money concerning a matter in which none of the disputants is interested, the dispute between them having already been resolved by themselves without the instrumentality of any statutory agency. In my opinion, there would be small reason for supporting that in spite of the portion to a dispute having settled. It as between themselves as industrial dispute between them continues, to exist for some inexplicable purpose of the industrial dispute Act
(21) The view that I take receives strongg support from the amendment to section 2(p) plaintiff the Industrial dispute Act. The definition as it now stands, of a 'settlement' contained in that clauses of Section 2 ,makes it clear that even a private settlement on and after the date on which that clause was amended, is equally governed by the provisions of section 19 of the industrial dispute Act. The amendments, in my opinion, is a clear legislative recognition of the efficiency of a private settlement between which and a settlement arrived at in conciliation proceedings, it would be impossible to recognise any distinction for the investigation of the question whether such settlement does or does not bring title an end and industrial dispute .
(22) The view that I take was what was expressed by their Lordships or the High Court of Madras in South India Estate Labour Relation Organisation v. State of Madras (S) : AIR1955Mad45 , On page 50 of the Report, this is what Venkatarama Aiyar, J. (As he then was ) observed:
'This relates to the question of house for the period 1949-50. In paragraph 12 of the affidavit in support of the petition , It is stated that this question was settled at a meeting of the employees and workmen on 4-4-1951, that the Union had withdrawn, this demand and that is also acknowledged by the Labour Officer, Pollachi, in his reference 204 of 1952 dated 23-3-1952. It is contended that there is no jurisdiction to refer this matter as there had been a settlement and there no dispute concerning it. In paragraph 9 of the counter affidavit filed on behalf of the Government, it is stated that as the settlement look place on 4-4-1952, the referred which was made on 24-3-1952 could not be said to be illegal. Thus the factum of settlement s accepted. The further statement that it took place on 4-4-1952 is admitted to be a mistake. The reference must accordingly he quashed as regards bonus for 1949-50'.
There are no doubt soon observation in Poona Mazoor Sabha v. C.K. Bhutia, AIR 1958 Bom 743, which might, at first sight, appear to indicate a contrary view. It is pointed out in the Parts of the judgment of Chagia C.J. that only settlement between the parties to an industrial dispute which is binding is a settlement arrived at through the instrumentally or the conciliation officer and that position was clear from the provisions of section 19(3). There is no doubt another observation that industrial law taken no notice of an industrial dispute such private agreement belonging as it does to the wain of contract giving rise to contracted rights and that therefore, anm industrial dispute does not end until a settlement is arrived at which has been given a binding effect under the provisions of Section 19(2).
(23) Mr. Nagesha Rao, not unnaturally placed strong reliance on these observations. But it will be seen that when the pronouncement of Chagla, C.J. is property understood, it cannot be regarded as laying down in absoulte terms any principle that a private settlement in respect any industrial dispute. In another part of his judgment, Chalaga, C.J. observed :
' But when the parties do arrive at a settlement the law gives to it a greater sanctity than it gives to an award, and therefore, the industrial law does not contemplate any interference with the finality of a settlement and it completes the settlement to run on for the period mentioned in the settlement itself and neither party is permitted to challenge that settlement, during its duration.
If the law was that a private settlement of an industrial dispute could not be arrived at which could be made binding, then it would be very difficult to induce parties to arrive at any such settlement, because the whole of Mr. Bhandare's argument revolves round this that it was open to the workers of the second opponent company the next day after they had arrived at this agreement to resile from that agreement.
Industrial peace demands that sanctity should be attached to agreements freely arrived at by the parties and if the view went abroad that private settlements have no sanctity whatsoever, then there would be little chance of disputes ending by settlement between the parties. It will indeed be unfortunate from the point of view of labour'.
(24) I should, before concluding this order, point out that there is another reason why we should come to the conclusion that the question involved in the impunged reference was finally settled between the petitioner and its workmen in the tripartite conference. Mr. Nagesha Rao has told us that after that settlement was reached, certain matters relating to the various milk industries were referred to the Board of Conciliation which was asked to arbitrate between the various industries which were parties to the tripartite agreement and their workers. He has also told us that the only matter which was referred to the Board of Conciliation in respect of the petitioner's industry was the non-payment to his workers of what is described as the pooja bonus. The fact that no other matter was referred to the Board of Conciliation is, in my opinion, the stronggest indication of the fact that every other matter between the petitioner and its workmen had been settled by the agreement reached at the tripartite conference.
(25) In the view that I take it would be unnecessary for us to express any opinion on the other argument advanced by Mr. Narasimha Murthy that we should in this case, quash the reference made by the State Government on the ground that it was made too late and after an unreasonably long delay.
(26) This application must therefore, succeed. In my opinion, the reference made by the State Government to the Labour Court on January 22, 1959 has to be quashed and it is so ordered. The Labour Court will be restrained from proceeding to make its adjudication on this reference.
(27) In the circumstances, there should be no order as to costs.
(28) I agree.
(29) Application allowed.