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Indian Drugs and Pharmaceuticals Limited Vs. Government of U.P. and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtAllahabad High Court
Decided On
Judge
Reported in(1976)IILLJ438All
AppellantIndian Drugs and Pharmaceuticals Limited
RespondentGovernment of U.P. and ors.
Excerpt:
- - by award dated june 24, 1972, the labour court held that the settlements were binding on the sharmik sangh as well as on all employees who were not members of any of the unions, that the dispute referred stood settled by the two settlements and that for this reason the reference was incompetent. at best, it will result in a private contract or agreement between the employers and these workmen. in our opinion, the decision of the labour court was clearly erroneous in law. and there are good reasons why this principle should be applicable to decisions of industrial tribunals also.g.c. mathur, j.1. the question which arises for consideration in this appeal is whether the reference made by the state government under section 4k of the industrial disputes act for adjudication of an industrial dispute regarding earned leave to the industrial tribunal (i), u.p., allahabad is incompetent on account of two earlier settlements and an earlier award of the labour court.2. there are three unions of workmen in the industry known as indian drugs and pharmaceuticals ltd., rishikesh, namely, the antibiotics project (rishikesh) karamchari sangh (hereinafter referred to as the 'karam chari sangh'), the rashtriya sharmik sangh (hereinafter referred to as the 'sharmik sangh') and indian drugs & pharmaceuticals limited employees union (hereinafter referred to as the 'i.d.p.l. union')......
Judgment:

G.C. Mathur, J.

1. The question which arises for consideration in this appeal is whether the reference made by the State Government under Section 4K of the Industrial Disputes Act for adjudication of an industrial dispute regarding earned leave to the Industrial Tribunal (I), U.P., Allahabad is incompetent on account of two earlier settlements and an earlier award of the Labour Court.

2. There are three unions of workmen in the industry known as Indian Drugs and Pharmaceuticals Ltd., Rishikesh, namely, the Antibiotics Project (Rishikesh) Karamchari Sangh (hereinafter referred to as the 'Karam chari Sangh'), the Rashtriya Sharmik Sangh (hereinafter referred to as the 'Sharmik Sangh') and Indian Drugs & Pharmaceuticals Limited Employees Union (hereinafter referred to as the 'I.D.P.L. Union'). Disputes were raised by each one of these three unions. The dispute raised by the Sharmik Sangh related to earned leave to workmen employed after 27-5-1969. Negotiations started between the company and the three unions regarding these demands. It appears that settlements were reached in respect of all the demands, but at some stage the Sharmik Sangh withdrew from the negotiations. Two settlements were executed on September 30, 1970, one between the company and the Karamchari Sangh and the other between the company and the I.D.P.L. Union. These settlements were subsequently registered with the Conciliation Officer. No settlement was executed between the company and the Sharmik Sangh. By these settlements the disputes relating to increase in wages and the discontinuance of project allowance were specifically settled. Paragraph 4 in both the settlements stated that the settlements fully and finally resolved and settled all matters of dispute and the parties confirmed that no dispute or matter of demand of whatsoever nature remained outstanding between them. Each of the settlements thereafter recited as follows:

The union hereby agrees and confirms further not to make any demand which would involve additional financial liability during the period of the operation of this agreement. If, however, the Plant reaches the stage of profitability during the operation of the settlement, workers may bring up any reasonable demand other than in the nature of general wage revision for the consideration of the Management.

By Clause (3) of each settlement, the settlement was to remain in force for a period of three years and thereafter it was to continue to be in force until it was terminated by the service of notice in writing by either of the parties.

3. Subsequent to the execution of the two settlements the company put up a notice on Oct. 21, 1970. The relevant part of which reads as follows:

It is, therefore, notified for general information that those workmen who are members of the Rashtriya Sharmik Sangh or are not members of the signing unions will, if they receive the payments as envisaged under the agreement dated 30-9-70, be deemed as having agreed to it and bound by the same. Such receipt of payment will, therefore, act as an estoppel for further in claims and disputes.

According to the company all the workmen voluntarily accepted payments under the settlements and thereby became bound by these settlements.

4. By notification dated May 15, 1971, the State Government referred under Section 4K of the U.P. Industrial Disputes Act an industrial dispute relating to the stoppage of educational facilities for the children of the workmen from July, 1970 for adjudication to the Labour Court, Meerut. Before the Labour Court the company raised objections that the settlements dated September 30, 1970, were binding on all the unions including the Sharmik Sangh, that no dispute could be raised during the pendency of the settlement and that for this reason the reference was incompetent. The Sharmik Sangh was one of the parties to this reference. By award dated June 24, 1972, the Labour Court held that the settlements were binding on the Sharmik Sangh as well as on all employees who were not members of any of the unions, that the dispute referred stood settled by the two settlements and that for this reason the reference was incompetent.

5. By another notification dated December 11, 1972, the State Government referred under Section 4K. of the Act an industrial dispute relating to earned leave allowable to workmen employed after 27-5-69 for adjudication to the Industrial Tribunal (1) Allahabad, it is to be noticed that this was the dispute which the Sharmik Sangh had originally raised before the two settlements were arrived at. The company again raised preliminary objections contending that in view of the two settlements and the award of the Labour Court the present dispute should be deemed to have been settled and, therefore, the reference was incompetent. In view of these objections the Tribunal framed the following additional issue:

Whether the present dispute between the workmen and the employer stood resolved in view of the settlement dated 30-9-70 and the award of the 'Labour Court, Meerut in Adj. case No. 93 of 1971 and the workmen were, therefore, estopped from raising the dispute If so, what would be the effect on the reference ?'.

6. By order dated March 15, 1973, the Tribunal decided the issue against the company. It held that it was not bound by the findings of the Labour Court, that the dispute referred had been raised only the Sharmik Sangh, which was not a signatory to the settlements, and that the settlement were not binding on the Sharmik Sangh. The Tribunal further held that by the two settlements two specific disputes were settled and that the observations of a general nature contained in Clause (4) of the settlements that all the other demands have been fully and finally resolved cannot be deemed to have settled and resolved all other matter of disputes. Against the order of the Tribunal the company filed a writ petition in this Court. The writ petition was dismissed by learned single Judge on January 31, 1975. Hence this appeal.

Arguments were addressed to us on the following two questions:

1. Whether the decision of the Labour Court in the first reference that the settlement of September 30, 1970, was binding on the Sharmik Sangh is correct or not?

2. Whether the decision of the Labour Court whether right or wrong, operates as res judicata against the Sharmik Sangh in the present reference before the Industrial Tribunal ?

If the settlement of September 30, 1970, is binding on the Sharmik Sangh and on the workmen who are its members then the dispute relating to earned leave was also covered by it and could not be raised during the period the settlement remained in force. In Sirsilk Ltd. v. Government of Andhra Pradesh : (1963)IILLJ647SC , the Supreme Court has held that when parties to an industrial dispute execute a settlement, the industrial dispute comes to an end and no award can be given in respect of it. It was urged by the appellant that the settlement being binding on all the unions, including the Sharmik Sangh, no industrial dispute remained and the State Government was incompetent to make the reference regarding the earned leave. It is in this connection that the question whether the settlement was binding on the Sharmik Sangh or not has arisen.

Settlement outside conciliation proceedings are governed by the provisions of Section 6B of the U.P. Industrial Disputes Act. This section reads as follows:

6B.--Settlement outside conciliation proceedings:

(1) A settlement arrived at by agreement between the employer and work men otherwise than in the course of conciliation proceeding shall, except as provided in Sub-section (4) be binding on the parties to the agreement:

Provided that if the period for which a settlement shall remain in force has not been laid down in such settlement itself, it shall remain in force for one year from the date of its registration.(2) As soon as a settlement referred to in Sub-section (1) has been arrived at, the parties to the settlement or any one of them may apply to the conciliation officer of the area concerned in the prescribed manner for registration of the settlement.

(3) On receipt of application for registration under Sub-section (2) the conciliation officer or an authority notified by the State Government in this behalf either (i) register the settlement in the prescribed manner, or (ii) refuse registration if it considers it to be inexpedient to do so on public grounds affecting social justice, or if the settlement has been brought about as a result of collusion, fraud or misrepresentation.

(4) When a settlement under Sub-section (i) has been refused registration, it shall not be binding under this Act.

7. The U.P. Industrial Disputes Rules, 1957, prescribe the form in which the settlement is to be executed. They also provide as to who will sign the agreement can be signed in the case of a workman, by the workman himself by the president or the secretary of the union competent to represent him and also by five representatives of the workmen duly authorised in this behalf. It is only when a settlement is executed and registered in accordance with the provisions of Section 6B and of the Rules that it becomes binding. From the reading of Section 6B and of the Rules it appears that a settlement is permissible between the employer and a workman or a section of the workmen or the entire body of the workmen. From the language of Section 6B it is apparent that a settlement is binding only on the parties to it. Therefore, normally the two settlements to which the Karamchari Sangh and the I.D.P.L. Union were parties, but the Sharmik Sangh was not a party, would not bind the Sharmik Sangh or the workmen who were members of it.

8. Learned Counsel for the appellant relied upon two circumstances to establish that the settlement was binding on the workmen, who were members of the Sharmik Sangh, and on the Sharmik Sangh itself. Shortly after the execution of the two settlements, the company had put up a notice, informing all the workmen about the two settlements and of the fact that the Sharmik Sangh had not joined in the execution of the settlements. It then informed the workmen, who were members of the Sharmik Sangh or who were not members of the unions signing the settlements, that they could receive the payments envisaged in the settlements if they agreed to be bound by the same. The second circumstance pointed out was that every workman, who was a member of the Sharmik Sangh, voluntarily accepted the payments under the agreements. On the basis of these two circumstances the learned Counsel asked us to hold that the members of the Sharmik Sangh agreed to be bound by the settlements or, in other words, they adopted the settlements. The Labour Courts which accepted the contention of the appellant relied upon the decision of the Supreme Court in Amalgamated Coffee Estates Ltd. v. Their Workmen' 1965-II L.L.J. 110. In this case, a number of coffee, tea and rubber estates in South India had preferred an appeal to the Supreme Court against the award of the Special Industrial Tribunal for plantations. During the pendency of the appeal, the subject-matter of disputes were settled between most of the managements and most of their employees represented by certain unions. An application was made to the Supreme Court to dispose of the appeal in terms of the settlement. This was opposed by some of the employees on the ground that the unions representing them were not parties to the settlement and the appeals must be decided on merits so far as they were concerned. The Supreme Court called for a finding from the Industrial Tribunal whether the settlement was not valid and binding on all the workmen. The Industrial Tribunal submitted a finding that, in every estate, payments were made in terms of the settlement and that such payments were voluntarily and knowingly accepted by the workmen. It also held that the terms of the settlement were fair. On receipt of the finding, the Supreme Court disposed of the appeals in terms of the settlement. The Supreme Court observed that the settlement appeared to it to be a fair one and that, on that account, the appeals should be decided in accordance thereof. We do not think that the Supreme Court, in this case, laid down that the settlement was binding on the workmen who were not parties to it and who had accepted payments under it. Since the Supreme Court was deciding an appeal against the award of an Industrial Tribunal, it could decide the appeal of the parties to the settlement in terms of the settlement and the appeal relating to others on merits. Since the settlement was found to be a fair one, the Supreme Court thought fit that the decision on merit regarding the other workmen should also be on the same lines as the settlement.

9. In Dunlop India Ltd. v. Their Workmen 1972-II L.L.J. 1, the question, which arose for consideration, was whether a settlement entered into in 1961 between the employer and one of the unions regarding the age of retirement was binding on the other workmen who were not represented by the signing union. It was urged on behalf of the company that any benefits conferred by the settlement on the workmen had also, been availed of by the workmen who were not members of the signing union and, therefore, these workmen were bound by the provisions contained in the settlement relating to the age of retirement. The Supreme Court held that a settlement binds only those workmen who are members of the union which signed the, settlement and the mere fact that a workman gets the benefit of higher wages fixed under the settlement cannot be considered to be a bar to disputing the right of the management to retire him at the age of 55 under the terms of the settlement.

10. In Jhagrakhan Collieries (P) Ltd. v. G.S. Agarwal 1975-I L.L.J. 163 the Supreme Court laid down that an agreement, outside conciliation proceedings, is not binding on a workman who was not a party to it even if he has acquiesced in it or has accepted a benefit under it. The case before the Supreme Court arose under Section 18 of the Central Industrial Disputes Act. The Supreme Court observed:

We have already noticed that according to the Scheme of Section 18, read with Section 2(d), an agreement, made otherwise than in the course of conciliation proceedings to be a settlement within the meaning of the Act must be a written agreement signed in the manner prescribed by the Rules framed under the Act. As rightly pointed out M. Ramamurthy, learned Counsel for the respondents, an implied agreement by acquiescence, or conduct such as acceptance of a benefit under an agreement to which the worker acquiescing of accepting the benefit was not a party, being outside the purview of the Act, is not binding on such a worker either under Sub-section (1) or under Sub-section (3) of Section 18. It follows, therefore, that even if 99 per cent of the workers have impliedly accepted the agreement arrived at on October 22, 1969, by drawing V.D.A. under it, it will not, whatever its effect under the general law put an end to the dispute before the Labour Court and make it functus officio under the Act.

In this connection, we may refer to certain observation of Chagla, C.J. in Poona Mazdoor Sabha v. Dhutia (C.V.) This decision was given at a time when a settlement, outside conciliation proceedings, was not recognised by the Central Act. In this case, parties had arrived at a settlement outside and, on their request the Conciliation Officer had merely recorded the settlement. Holding that such a settlement could not have a binding force so as to conclude the industrial dispute, Chagla, C.J. observed:

The only settlement between the parties which is binding is the settlement arrived at through the instrumentality of the Conciliation Officer. That is clear from the provision of Section 19(3), It is only that settlement upon which the law has put its imprimature and to which the law has given sanctity and which the law has made bindings.

Industrial law takes no notice of any private settlement or agreement arrived at between the parties in the course of an industrial dispute. Such a private agreement belongs to the reals of contract; it may give rise to contractual rights; but when we are dealing with industrial law, it has no sanction whatsoever, and, therefore, in the eye of the industrial law, in our opinion, an industrial dispute does not and until a settlement is arrived at, which settlement has been given a binding effect under the provisions of Section 19(2).

From these decisions it is clear that it is only a settlement which is executed in accordance with the provisions of the law which will have the effect of putting an end to an industrial dispute and of preventing the State Government from making a reference of that industrial dispute. The mere fact that the workmen, who were not parties to the settlement have accepted voluntarily and knowingly benefits under the settlement will not result in there coming into existence another settlement between the employers and these workmen. At best, it will result in a private contract or agreement between the employers and these workmen. But this contract or agreement will not have the status of the settlement or agreement contemplated by Section 6B of the U.P. Industrial Disputes Act. It thus appears to us, on the authority of the Supreme Court decisions, that by the acceptance of the monetary benefits under the settlement and by impliedly agreeing to be bound by the terms of the agreement, there did not come into existence another settlement between these workmen and the employers and further that these workmen could not be deemed to have become parties to the settlement. They, therefore, could not legally be held to be bound by the settlement and were not prevented from raising an industrial dispute even if it was covered by the settlement. In our opinion, the decision of the Labour Court was clearly erroneous in law.

11. We now come to the second question whether, even the decision of the Labour Court was erroneous, it could on the principles of res judicata, bar the Sharmik Sangh from contending in the second reference before the Industrial Tribunal that it was not bound by the settlement. On this question, a number of decisions of the Supreme Court were cited before us by learned Counsel for both parties. We will first refer to the decisions cited by learned Counsel for the appellant.

12. In Burn Co. v. Their Employees 1957-I L.L.J. 226, it was urged before the Supreme Court that once a dispute is referred to a Tribunal and that results in adjudication, that must be taken to be binding on parties thereto unless there is a change in the circumstances. Holding that the principles of res judicata applied to industrial adjudication, the Supreme Court observed:

And there are good reasons why this principle should be applicable to decisions of Industrial Tribunals also. Legislation regulating the relation between Capital and Labour has two objects in view. It seeks to ensure to the workmen who have not the capacity to treat with capita] on equal terms, fair returns for their labour. It also seeks to prevent disputes between employer and employees, so that production might not be adversely affected and the larger interests of the society might not suffer. Now, if we are to hold that an adjudication loses its force when it is repudiated under Section 19(6) and that the whole controversy is at large, then the result would be that far from reconciling themselves to the award and settling down to work it, either party will treat it as a mere stage in the prosecution of a prolonged struggle, and far from bringing industrial peace, the awards would turn out to be but truces giving the parties breathing time before resuming hostile action with renewed vigour.

On the other hand, if we are to regard them as intended to have long term operation and at the same time hold that they are liable to be modified by chance in the circumstances on which they were haves, both the purpose of the Legislature would be served.

13. In Management of the Bangalore Woollen, Cotton and Silk Mills Co. Ltd. v. Workmen : (1957)ILLJ226SC , the Supreme Court held that, while the previous award was still binding, points settled in that award cannot be considered in a fresh reference. In this case, on a reference made by the Government, the Industrial Tribunal gave an award, modifying the certified standing orders of the company. Thereafter the workmen started making certain and other reference was made by the Government covering the same matters. In the second reference, the employers raised an objection that, since the matters were covered by the earlier award they could not form the subject-matter of a fresh adjudication. The Supreme Court did not accept the contention that the first award had been duly terminated by a notice and held that it remained in operation, thereby barring the Tribunal from reconsidering the same matter.

14. The last case relied upon by learned Counsel for the appellant is Bombay Gas Co. Limited v. Jagannath Pandurang 1975-II L.L.J. 345. In this case, an industrial dispute regarding overtime wages to the workmen at the rate payable under the Factories Act was referred for adjudication. An award was given rejecting this claim. Subsequently, application was made under the Payment of Wages Act, claiming overtime wages on the basis of the Bombay Shops and Establishments Act, this Act was in force at a time when the first dispute was referred for adjudication. The Supreme Court held that the question of overtime wages could not be dealt with and disposed of by the Payment of Wages Authorities as it should be deemed to have been dealt with and disposed of by the Tribunal in the first award. The principles of constructive res judicata were apparently applied by the Supreme Court in this case. The Supreme Court observed:

The doctrine of res judicata is a wholesome one which is applicable not merely to matters governed by the provisions of the Code of Civil Procedure but to all litigations. It proceeds on the principle that there should be no unnecessary litigation and whatever claims and defences are open to parties should all be put forward at the same time pro vided no confusion is likely to arise by so putting forward all such claims.

These decisions do show that the principles of res judicata can be applied in industrial adjudication.

Let us now examine the cases cited by learned Counsel for the workmen. In Management, Shahdara (Delhi) Saharanpur Light Railway Co. Ltd. v. S.S. Railway Workers Union 1969-I L.L.J. 734 the question of applying the principles of res judicata arose in connection with an application for modification of the certified standing orders. The Supreme Court observed:

The trend in recent decisions is that application of technical rules such as res judicata, acquiescence, estoppel, etc.. are not appropriate to industrial adjudication.... In workmen of Balmer Lawrie & Co. v. Balmer Lawrie & Co. 1964-I L.L.J. 380, also, it was observed that the questions to revision of wage scales must be examined on the merits of each individual case and technical considerations of res judicata should not be allowed to hamper the discretion of industrial adjudication. It is, therefore, doubtful whether principles analogous to res judicata can properly be applied to industrial adjudication.

15. In Agra Electric Supply Co. Ltd. v. Sri Alladin (supra) three workmen had been employed by the company long before the certified standing orders came into force in 1951. Relying on the standing orders, the company retired these three workmen after they attained the age of 55 years which was prescribed as the age of superannuation in Standing Order No. 32. The dispute arising out of this retirement was referred for adjudication to the Labour Court. The Labour Court gave an award in favour of the workmen, holding that the standing orders did not apply to workmen, who had joined the company before the standing orders were certified. It accordingly ordered their reinstatement. Against the award the company went up in appeal to the Supreme Court. Before the Supreme Court the workmen contended that, in an earlier reference between the company and its workmen, this very Labour Court had decided that these standing orders did not apply to workmen previously employed and that the special leave petition against that award had been dismissed by the Supreme Court and, therefore, the company was not entitled to re-agitate the same question as it was precluded from doing so by principles analogous to the principles of res judicata. The Supreme Court rejected this contention and held that the standing orders applied also to workmen who had been employed before the standing orders had been certified. It accordingly set aside the award of the Labour Court. The Supreme Court held that the first award of the Labour Court was given at a time when the decision of the Supreme Court in Workmen v. Kettlewel Bullen & Co. Ltd. 1964--II L.L.T. 146, was understood to lay down that standing orders were not binding on those who were employed prior to their certification and that, at the time of the second award, it had been clarified by the Supreme Court in Salem-Erode Electricity Distribution Co. (P) Ltd. v. Their Employees' Union 1966-I L.L.J. 443, that that was not the correct interpretation and that the standing orders were binding even on workmen who had joined before they were certified. The Supreme Court then observed that the second reference and the award were made in circumstances different from those which prevailed when the first reference and the award were made, and this made the application of the principle of res judicata doubtful. In fact, the Supreme Court did not apply any principle analogous to the principle of res judicata in this case for, if it had done so, the contention of the workmen was bound to be upheld.

16. The Mumbai Kanigar Sabha, Bombay v. Abdulbhai Faizullabhai 1976-II L.L.J. 186, is a case where the Supreme Court refused to apply the principles analogous to the principles of constructive res judicata--In this case, a reference was made of the industrial dispute whether the workmen were entitled to claim profit bonus for the year 1965 to the Board of Arbitrators under Section 10A of the Central Act. The Board rejected the demand on the ground that no claim for bonus was admissible, except that which was covered by the Bonus Act. Subsequently, another industrial dispute was referred for adjudication to the Industrial Tribunal by the Government whether the workmen were entitled to customary bonus. The Tribunal held that the award of the Board of Arbitrators in the earlier reference operated as res judicata in the subsequent reference. The Supreme Court held that the claim in the second reference was not barred on the principles analogous to the principles of res judicata. It will be noticed that, under the first reference, the claim was for bonus on the ground of profit while the claim in the second reference was also for bonus but on the ground of custom. The Supreme Court distinguished its earlier decision in Bombay Gas Co. Limited v. Jagannath Pandurang (supra). It observed:

We do entertain doubts about the extension of the sophisticated doctrine of constructive res judicata to industrial law which is governed by special methodology of conciliation, adjudication and considerations of peaceful industrial relations, where collective bargaining and pragmatic justice claim precedence over formalised rules of decision based on individual contents, specific causes of action and findings on particular issues.

17. This much appears from the decisions of the Supreme Court that rules analogous to the rules of res judicata and constructive res judicata are not rules which are of universal application in industrial adjudication. The case before us is, in our opinion, governed by the decision of the Supreme Court in the case of Agra Electric Supply Co. Ltd. v. Sri Alladin (supra). At the time when the Labour Court gave its decision that the settlement was binding on the Sharmik Sangh, it was possible to take that view, on account of the decision of the Supreme Court in Amalgamated Coffee Estates Ltd. v. Their Workmen (supra) but, now, in view of this, it is not possible. Now the Supreme Court has laid down in these two cases that a settlement will not bind the workmen who are not parties to it even if they knowingly and voluntarily accept benefits under that settlement. Thus both the reference and the award by the Labour Court were made in circumstances different from those which prevailed at the time of the second reference. Since the view taken by the Labour Court has now been found to be erroneous, it will be perpetuating that erroneous view if the decision of the Labour Court is held to operate as res judicata in the present reference. This would hardly be conducive to industrial peace which is the object of industrial law and adjudication.

18. This conclusion finds support from another decision of the Supreme Court in Mathura Prasad Sarjoo Jaiswal v. Dessibai N.B. Jeejeebhoy : [1970]3SCR830 . This was not a case of industrial adjudication and the question, which arose for consideration, related to the applicability of Section 11 of the Code of Civil Procedure. In this case a lessee of open land, who had constructed buildings there on for residential or business purposes, submitted an application of the Civil Judge for determination of the standard rent of the land under the Bombay Rents, Hotel and Lodging House Rates Control Act, 1947. The Civil Judge rejected the application, holding that the provisions of the Act did not apply to open land let out for constructing buildings for residence, education, business, trade or storage. This order was upheld by a learned single Judge of the Bombay High Court. But, in another case, the Bombay High Court took a contrary view and that view was upheld by the Supreme Court. On the basis of the subsequent decision, the tenant again made an application for fixation of standard rent. This application was dismissed as barred by res judicata on account of the decision in the earlier application and the order of the trial Court was confirmed by the High Court of Bombay. Against this decision, the tenant went up in appeal to the Supreme Court. The Supreme Court allowed the appeal and held that the decision in the earlier case did not operate as res judicata in the subsequent case. The Supreme Court observed:

A question relating to the jurisdiction of a Court cannot be deemed to have been finally determined by an erroneous decision of the Court. If by an erroneous interpretation of the statute the Court holds that it has no jurisdiction, the question would not, in our judgment, operate as res judicata. Similarly, by an erroneous decision, if the Court assumes jurisdiction which it does not possess under the statute, the question cannot operate as res judicata between the same parties, whether the cause of action in the subsequent litigation is the same or otherwise.

It then went on to say:

In the present case, the decision of the Civil Judge, Junior Division, Forivli, that he had no jurisdiction to entertain the application for determination of standard rent, is in view of the judgment of this Court, plainly erroneous, see A.I.R. 1966 S.C., 1939. If the decision in the previous proceeding be regarded as conclusive, it will assume the status of a special rule of law applicable to the parties relating to the jurisdiction of the Court in derogation of the rule declared by the Legislature.

In the course of its judgment, the Supreme Court also observed:

The previous decision on a matter in issue alone is res judicata; the reason for the decision are not res judicata.

In the present case, the Labour Court had held that it had no jurisdiction to entertain the reference made by the State Government regarding the withdrawal of educational facilities for the children of the workmen. The reason for this decision was stated to be that the industrial dispute had ceased to exist as the settlement was binding on the Sharmik Sangh and on the workmen who were members of the erroneous decision of the Labour Court that it had no jurisdiction to entertain any industrial dispute cannot, in view of the decision of the Supreme Court in Mathura Prasad's case, operate as res judicata in the subsequent reference. It is to be noticed that the second reference is not in respect of the same industrial dispute which had been referred to the Labour Court. In the second reference, an industrial dispute regarding earned leave was referred by for adjudication. What was urged by learned Counsel for the appellant was that the reason given by the Labour Court for its decision, v.z., that the settlement was binding on the Sharmik Sangh and its members operates as res judicata in the second reference. The reasons given by the Labour Court for its decision cannot operate as res judicata; in the second reference, particularly as the subject-matter of the second reference is totally different from that of the first.

19. For these reasons, we hold that the award of the Labour Court in the first reference does not operate as a bar on any principle analogous to the principle of res judicata in the second reference to the Industrial Tribunal. The Industrial Tribunal was accordingly justified in holding that the reference was competent and that it had jurisdiction to adjudicate thereupon.

20. The appeal is dismissed with costs.


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