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A. Tellery and Sons Vs. Carpet Mazdoor Sabha, a Registered Trade Union and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtAllahabad High Court
Decided On
Case NumberCivil Misc. Writ No. 704 of 1959
Judge
Reported inAIR1961All321; [1961(3)FLR92]; (1962)ILLJ309All
ActsConstitution of India - Article 254; Uttar Pradesh Industrial Disputes Act, 1947 - Sections 4I and 4K; Industrial Disputes Act, 1947 - Sections 19
AppellantA. Tellery and Sons
RespondentCarpet Mazdoor Sabha, a Registered Trade Union and ors.
Appellant AdvocateT.N. Sapru, Adv.
Respondent AdvocateM.N. Shukla and ;Shambhu Prasad, Advs. for ;Standing Counsel
DispositionPetition allowed
Excerpt:
.....commissioner referred matter to industrial tribunal - industrial tribunal invoked section 19 of central industrial tribunal act, 1947 and gave award against employer - employer appealed to high court - provisions of central act not applicable in state of uttar pradesh - employer empowered by section 4-i to vary terms and conditions of services of employee after giving due notice - employees can raise an industrial dispute - if state government considers matter to be of importance it can refer matter to industrial tribunal - petition allowed and order of industrial tribunal quashed. - - if the award is not under any of tbe court or tribunal constituted under the central act, it can-not be deemed to be an award for the purpose of the central act and similarly the present settlement..........referred for adjudication on the 21st of january 1952 by the government of uttar pradesh to the state industrial tribunal u. p., allahabad, which gave an award on the 26th of may, 1952 by which annual increments were fixed for all workmen except night watchmen. thereafter, there also appears to be a dispute between the petitioner and its workmen about the medical facilities to be given to the workmen.that also formed a matter of industrial dispute and was referred by the government on 5th of june, 1952, to the state industrial tribunal which gave an award dated the 18th of august, 1952, under which medical facilities were given to the workmen. by an agreement dated 30th of june, 1955, the company agreed that it will give annual increments. we are not at the present moment concerned.....
Judgment:
ORDER

V.D. Bhargava, J.

1. This is a writ petition under Article 226 of the Constitution filed by Messrs. A. Tellery and Sons which is a joint stock company registered under the Indian Companies Act, 1913, having its registered office at Varanasi. The business of the Company is of manufacturing and selling, carpets. There had been disputes between the petitioner and its workers. It appears that there was no annual increment being given to the workmen.

The dispute was referred for adjudication on the 21st of January 1952 by the Government of Uttar Pradesh to the State Industrial Tribunal U. P., Allahabad, which gave an award on the 26th of May, 1952 by which annual increments were fixed for all workmen except night watchmen. Thereafter, there also appears to be a dispute between the petitioner and its workmen about the medical facilities to be given to the workmen.

That also formed a matter of industrial dispute and was referred by the Government on 5th of June, 1952, to the State Industrial Tribunal which gave an award dated the 18th of August, 1952, under which medical facilities were given to the workmen. By an agreement dated 30th of June, 1955, the Company agreed that it will give annual increments. We are not at the present moment concerned with the details of these awards and the agreement.

2. These awards had been given In the year 1952. According to the petitioner its financial condition had changed and it had been suffering losses for several years. Therefore, under Section 4-I of the U. P. Industrial Disputes Act the petitioner had served a notice upon its workmen to the following effect:

'Please, therefore, take notice that it has been decided to stop the Annual Increments which would accrue to the workmen of the Concern from 1st July, 1958 and onwards until its financial position improves as there is at present no further capacity with the concern to meet such extra charges.'

Thereafter acting under Section 4-I of the U. P. Industrial Disputes Act the petitioner stopped payment of the annual increments. Similar notice was also given with respect to the stopping of the medical facilities and the reason given was also the same.

3. The workmen of the concern raised an industrial dispute which was by an order of reference No. 906 (Reference) 76 (A L R)/1958, dated .November 22, 1958, issued by Sri Sri J. Prasad, Deputy Labour Commissioner (Industrial Relations), Uttar Pradesh, in purported exercise of his powers under Section 4-K of the U. P. Industrial Disputes Act, referred (the matter) (sic) for adjudication to the Industrial Tribunal (General) at Allahabad. The matter which had been referred to the Industrial Tribunal was as follows :

'MATTER OF DISPUTE:

1. Whether the action of the employers in stopping the annual increments to their workmen with effect from 1st July, 1958 is unjustified and/or wrongful? If so, to what relief are the workmen entitled?

2. Should the employers be required to 'continue to provide free medical treatment to the workmen? If so, from which date and with what details?'

The matter came up before the Industrial Tribunal, and, inter alia several questions were raised and on the questions raised the following issues were framed :

1. Whether the reference is without jurisdiction and, therefore, void?

2. Whether the financial condition of the employers has deteriorated? If so, does that circumstance entitle them to withdraw the benefits secured to the workmen by awards and agreement?

3. Whether the employers have complied with the requirements of law which entitled them to ignore the previous awards and the agreements.

4. To what relief, if any, are the workmen entitled?

4. The Industrial Tribunal came to the conclusion that the reference was within jurisdiction. It did not decide the question whether the financial condition of the employers had deteriorated or not and whether that circumstance entitled them to withdraw the secured benefits of the workmen. It came to the conclusion that Section 19 of the Central Industrial Disputes Act (Act XTV of 1947) applied and, therefore two months' notice should have been given. A notice of little more than one month was not enough, and, therefore, the employer were not entitled to withdraw the benefits.

Questions of fact actualy had not been decided at all by the Industrial Tribunal. It directed that the employers would nay all the amenities to which the employees were entitled under the awards and the agreement. Aggrieved by that decision the petitioner has crimp to this Court and has infer alia, raised the following grounds : (1) that the reference under Section 4-K should have been by the State Government and it should be the opinion of the State Government and not of the Deputy Labour Commissioner: and the State Government had no power to delegate this power to the Deputy Labour Commissioner.

It was further alleged that in fact there had been even no such delegation of power also. (2) That Section 19 of the Central Industrial Disputes Act did not apply to the proceedings and the awards made under the U. P. Industrial Disputes Act that could be only applicable to proceedings under the Central Industrial Disputes Act. (3) Even if for the sake of argument it be accepted that Section 19 applied to the proceedings under the U. P. Industrial Disputes Act, then instead of disposing of the reference on this technical ground, the Tribunal should have gone into the matter and decided it on merits, because the Industrial Tribunal should not have refused to act on mere technical grounds.

5. Learned counsel for the petitioner has argued that if grounds Nos. 2 and 3 prevail then he does not wish to press his ground No. 1 at this stage. It appears that a matter similar to ground No. 1 has been referred to a larger Bench but I do not propose to postpone the decision of this petition till the decision of that petition by a larger Bench, because, in my opinion, it can be disposed of on the other two grounds. In case this court takes the view that the State Government has no power to delegate or that there had been no proper delegation in the other case it may be open to the parties to take such objection at a time whenever they consider it necessary.

6. On the question whether Section 19 of the Central Industrial Disputes Act applies to the facts of the present case the learned counsel had argued, that in Section 19 the words 'settlement' and 'award' have been used. 'Settlement' has been defined in See. 2(p) as follows:

' 'Settlement' means a settlement arrived at in the course of conciliation proceedings and includes a written agreement between the employer and workmen arrived at 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.'

'Award' has been defined in Section 2(b) as follows :

' 'Award' means an interim or a final determination of any industrial dispute or of any question relating thereto by any labour Court, Industrial Tribunal or National Industrial Tribunal and includes an arbitration award made under Section 10A'.

Labour Court, National Tribunal and Tribunal have also been defined in Section 2(kka), 2(11) and 2(r). All of them have to be constituted under Sections 7, 7A and 7B of the Central Industrial Disputes Act. It was argued, that, when the words 'award' and 'settlement* have been used, they have been used as awards of the Labour Court, Industrial Tribunal or the National Tribunal, as constituted under the Central Act.

If the award is not under any of tbe Court or Tribunal constituted under the Central Act, it can-not be deemed to be an award for the purpose of the Central Act and similarly the present settlement bad not been arrived at during the conciliation proceedings under the Act nor was it sent to the appropriate Government as required under the section defining 'settlement'.

The argument of the learned counsel, therefore, was that the words 'settlement' and 'awards' could only refer under Section 19, to the 'settlement' and the 'award', which had been arrived at during the proceedings under that Act and not otherwise. It is nobody's case that the present awards or settlement had been arrived at in the proceedings under the Central Act.

7. The Industrial Tribunal has repelled this argument on the ground that there being little repugnancy between the Central Act and the Provincial Act the Central Act would prevail and therefore Section 19 would apply and has based its argument on Article 254 of the Constitution.

8. Article 254 of the Constitution is applicable only to cases where there is any inconsistency between the Central Act and the State Act. If there is no inconsistency between the two, in my opinion, Art, 254 would not come into play at all. Both the clauses of Article 254 refer to the word 'repugnancy'. In Sub-clause (1) reference is made to the cases where a Parliament has made a law in the Concurrent list and if there is repugnancy subject to Sub-clause (2) it shall prevail.

Sub-clause (2) provides that if a legislature of a State legislates a law with respect to one of the matters enumerated in the Concurrent list which contains any provision repugnant to the provisions of an earlier law made by Parliament or an existing law with respect to that matter, then, the law so made by the legislature of such State shall, if it has been reserved for the consideration of the President and has received his assent, prevail in that State.

In the present case the assent of the President had been obtained for the U. P. Industrial Disputes Act and, therefore, if there is any repugnancy it will be the State Act which would prevail. But I have already mentioned that the present case is not a case of repugnancy or any inconsistency; it is a case of omission of a certain thing in one Act.

9. When the State Legislature was amending the U. P. Industrial Disputes Act in January 1957 by U. P. Act I of 1957 it was fully aware of Section 19 of the Central Industrial Disputes Act. It did not choose to incorporate any similar provision in its own Act. It was not that it was an unintentional omission. In my opinion, if there is a law which is to the knowledge of the legislature and if any analogous law is being made and the Legislature does not incorporate a portion of that law, then the intention of the Legislature clearly is that it did not list to incorporate a similar provision in its Act.

There are certain Acts, where some provisions of Central Act are adopted en bloc. In that case the Legislature by means of one section enacts that the provisions of these sections shall apply in the case of other Acts also. In the present case, there being no such provision, in my opinion, the intention should be taken that the U. P. Legislature never wanted the introduction of the provisions of Section 19 of the Central Industrial Disputes Act to the proceedings under the U. P. Industrial Disputes Act.

The Industrial Tribunal while giving the award has relied on some of the decisions of the Industrial Tribunal and labour Appellate Tribunal. These decisions are : Cawnpore Omnibus Service Ltd. v. Their Employees, (1951) 2 Lab LJ 287 (Addl. R. C. O. Kanpur), Cawnpore Omnibus Service Ltd. v. Their Workmen,_ 1953-1 Lab LJ 47 (LATI--All); Muzaffarpur Electric Supply Co. Ltd. v. Their Workers, (1952) 2 Lab LJ 804 (LATI-Cal.); Cuttack Electric Supply Co. Ltd. v. Their Workmen, (1954) 1 Lab LJ 723 (Ind. Tri.--Orissa); Balmer Lawrie and Co. Ltd. v. Their Employees, (1954) 2 Lab LJ 218 (Ind. Tri. W. B.) and B. M. S. Motor Service v. Their Workmen, (1955) 1 Lab LJ 597 (Ind. Tri.--Coimbatore).

In some of these cases Section 19 had been applied, and therefore, it came to the conclusion that since Section 19 had been applied, therefore, Section 19 will apply in the present case also. So far as (1951) 2 Lab LJ 287 (Addl. RCO Kanpur), is concerned, it was a reference not under any local Act, but was a reference under Section 10 of the Central Industrial Disputes Act. It was not a case of Uttar Pradesh at all but a case of Orissa. We do not know whether any State Industrial Disputes Act at that time was in force or not.

Moreover, even if that was in force and the appropriate Government (State Government) preferred to refer under the Central Act, then all the provisions and procedures of the Central Act will apply and not of the Provincial Act. Moreover, this decision is by the Industrial Tribunal only and has no binding force on this court. Similarly, the case of (1954) 2 Lab LJ 218 (Ind. Tri. W. B.), 1(1955) 1 Lab LJ 597 (Ind. Tri. -- Coimbatore) and (1952) 2 Lab LJ 804 (LATI -- Cal.), are cases which were referred under Section 10 of the Central Act. They are also not cases of this province. Therefore, these decisions are of no help at all.

10. The case of (1953) 1 Lab LJ 47 (LATI--All), was a case where no question of application of Section 19 was raised at all. The earlier agreement had fixed certain annual increments. The question that arose in that case was whether that award by which increment had been given would be enforceable for all future time or only for a limited period. The Labour Appellate Tribunal decided as follows :

'The right to increments being thus established by the awards it must be held to ensure for the future unless and until the appellants are able to get rid of the effect of the award by recourse to appropriate proceedings taken afresh for the purpose. Admittedly the appellants did not give fresh notice for determining the award after the expiry of the period of six months and we are unable to presume in their favour that notice once given, though superseded by the order of Government had the effect of determining the award.'

It is not clear whether the reference in this case was under Section 10 of the Central Act or under the U. P. Industrial Disputes Act and if so under what notification. If it was under Section 10 of the Central Industrial Disputes Act, then no question arises and Section 19 of the Central Act would definitely apply and there can be no dispute.

But if the reference was under the local Act, even then the award once given will continue to have the force of the law unless some appropriate proceedings are taken. What those appropriate proceedings would be would depend on different facts. According to me in the U. P. Industrial Disputes Act, if award has once been given it will continue to have its effect until it has been (to be) (sic) varied with a notice under Section 4-1 of the Industrial Disputes Act.

11. Section 4-1 reads as follows :

'4-1. Notice of Change -- No employer who proposes to effect any change in the conditions of service applicable to any workman in respect of matter specified in the third schedule, shall effect such change-- a. without giving to the workmen likely to be affected by such change a notice in the prescribed manner of the nature of the change proposed to be effected; or

b. within twenty one days of giving such notice.'

12. In my opinion, when once an award is given it will remain in force as contemplated by the Industrial Disputes Act. But after the expiry of the period, if the award is not of a temporary character but is of a permanent character giving certain benefits for good, the award would be deemed to be part and parcel of the conditions of service and each party would be bound by the award.

It has been held in Workmen of Burn and Co. v. Burn and Co., (S) AIR 1957 SC 38, by their Lordships of the Supreme Court, that the Court should regard those agreements as intended to have long term operation and at the same time their Lordships held that they are liable to be modified by change in the circumstances on which they were based and both the purposes of the Legislature would be served.

The via media adopted by the Court, therefore, appears to be that though there is no specific provision in the Industrial Disputes Act as to the period during which these awards should continue after the period prescribed under the State and the Central Acts, yet they should be deemed to have the force of the law on the principle of maxim interest rei publicae ut sit finis litium. Their Lordships considered this principle as a sound principle of law.

The Madras High Court in Trichy Srirangam Transport Co. (Private) Ltd. v. Industrial Tribunal, Madras, (1959) 2 Lab LJ 515 (Mad) also appears to have taken a similar view that the Court should record those agreements as intended to have long term operations. There it was also held at the same time, that they are liable to modification or change. This will also depend to a certain extent, in my opinion, on the nature of the award.

If the award had decided something which was to be given in the past or something which would be only for a limited period then in that case the award has to be enforced within the time otherwise it may lapse by efflux of time, but on the other hand if the award is of the nature as in the present case of allowing annual increments then in that case unless it is set aside by appropriate proceedings it will continue to form part and parcel, as I have already said, of the term* and conditions of the service.

13. If the granting of the annual increment and the medical facilities had become the terms and conditions of the service, then in that case, I do not see why Sec, 4-1 would not be applicable, if the employer wants to change those terms and conditions of service. Section 4-1 clearly gives the power to the employer to effect any change in the conditions of service, but the only condition is that such change shall not be effected without giving notice to the workmen likely to be affected and the period of notice is fixed 21 days.

14. Learned counsel for the respondent had argued that though Section 4-1 gives power to change terms and conditions of service, yet, that could not be done without an industrial dispute having been raised by the employer and again having referred the matter to the Industrial Tribunal or the Court. I fail to see how that argument can be urged on the basis of Section 4-1. Wherever, the Legislature intended that without the sanction or the permission of an authority no condition of service shall be changed it specifically provided so.

In the Central Industrial Disputes Act, there is Section 33, which, inter alia, provides that if during the pendency of any conciliation proceedings before any industrial authority an employer wants to make any change in the terms and conditions of service he has to obtain an express permission in writing of the authority concerned before he can start proceedings.

If the intention of the Legislature similarly, was that if by virtue of an award certain conditions have been introduced as conditions of service between the employer and the employee and they could only be modified by means of another industrial dispute having been made and another reference to a court then there was nothing more easy than to include that provision in Section 4-1. There are already two conditions attached and a third condition could have easily been added to it.

15. If acting under the powers given to the employer under Section 4-I, he has given notice to change the terms and conditions of the service, and, if the employees are not satisfied, it is open to them to raise an industrial dispute and if the State Government thinks that the matter is of importance, it is open to the State Government to refer the matter as provided under Section 4-K of the U. P. Industrial Disputes Act.

16. Learned counsel for the respondent had relied on Niemla Textile Finishing Mills Ltd. v. 2nd Punjab Tribunal, (S) AIR 1957 SC 329, for the proposition that if once the award had been made it could not be challenged. But that decision has not laid down that it could not be modified by appropriate proceedings. If it could be modified under Sec, 4-1 it would be an appropriate proceeding and no objection to it can be taken.

17. Under the circumstances, I think the Industrial Court was in error when it held that the employer was not entitled to change the terms and conditions by giving a notice under Section 4-1. The whole decision of the Industrial Court is based on that erroneous decision on a question of law. If the Industrial Court had held otherwise it might have gone into the merits of this case.

18. Apart from this fact, Industrial Courts are actually made for the purpose of maintaining industrial peace and harmony. They should not be concerned too much with mere technicalities, and when a matter comes before the Industrial Court, the question that arises in a case should not be refused to be decided on mere technicalities, but an attempt should be made to have the case decided.

For example, in the present case the matter lias been simply decided on the ground that no notice under Section 19 of the Central Industrial Disputes Act having been given, the employees were entitled to the increments as had been awarded under the award. The employers thereafter had only to give a notice of two months and the industrial dispute would again be between the employer and the employee; no peace and harmony has been restored.

Under the circumstances, the appropriate proceedings, as has been held in Guest, Keen Williams Pr. Ltd. Calcutta v. P. J. Sterling, AIR 1959 SC 1279, in dealing with industrial disputes the application of technical legal principles should as far as is reasonable possible be avoided (Sic) Workmen affected by standing orders may not always and in every case succeed in obtaining a reference to the industrial tribunal on the relevant points.

That is why the tribunals should be slow and circumspect in applying the technical principles of acquiescences and estoppel in the adjudication of industrial disputes. If a dispute is raised after a considerable delay which is not reasonably explained the tribunal would undoubtedly take that fact into account in dealing with the merits of the dispute. But unless the relevant facts clearly justify such a course it would be inexpedient to throw out the reference on preliminary technical objections of acquiescence and estoppel.'

19. With great respect I add that these observations equally apply to the technical objections as have been taken in the present case. Supposing after two months notice had been given and the conditions are changed in accordance with Section 19 of the Central Industrial Disputes Act and when the dispute is raised this time the State Government might refuse to refer the matter. In that case the employees may suffer and, therefore, irrepairable harm may be done to them. Under the circumstances, it was incumbent upon the Industrial Tribunal to consider the question on merits whether the amenities which were being withdrawn could be justifiably withdrawn or not,

20. In another industrial case their Lordships of the Supreme Court bad taken a similar view. In Kays Constructions Co. (Private) Ltd. v. Its Workmen, AIR 1959 SC 208, it was observed that:

'In dealing with industrial disputes the tribunals should not be unduly influenced by academic questions of law and they should make an attempt to deal with the merits of each case according to its facts and circumstances. The functions of industrial tribunals while adjudicating upon disputes referred to them for adjudication are quite different? from those of arbitration tribunals that deal in matters of commercial dispute.'

21. In the circumstances, therefore, when the Industrial Tribunal had failed to consider the question on merits, I think it had failed to exercise its jurisdiction properly. In my opinion, therefore, the order of the Industrial Court has to be quashed which I hereby quash and direct the Industrial Court to act in accordance with law. So far as respondents, Nos. 2 and 3 are concerned they have not put in any appearance. The petition was opposed on behalf of respondent No. 1, and on behalf of the State. Although the counter affidavit has been filed on behalf of respondents Nos. 2 to 4 but they have not contested the petition.

22. The result is that the petition is allowed, the order of the Industrial Court is quashed andit is directed to act in accordance with law. Thepetitioner is entitled to his costs from both the respondents separately i.e., from the State as well asrespondent No. 1.


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