Skip to content


Association of Medical Representatives (M and V) Vs. the Industrial Tribunal and ors. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtMadhya Pradesh High Court
Decided On
Case NumberMisc. Petn. No. 347 of 1965
Judge
Reported inAIR1967MP114; [1967(15)FLR18]; (1966)ILLJ614MP
ActsIndustrial Disputes Act, 1947 - Sections 2 and 10(1)
AppellantAssociation of Medical Representatives (M and V)
RespondentThe Industrial Tribunal and ors.
Appellant AdvocateJ.V. Jakatdar and ;J.M. Sood, Advs.
Respondent AdvocateP.P. Combata and ;V.S. Pandit, Advs. for Respondent No. 2
DispositionPetition dismissed
Cases ReferredWorkmen of Messrs. Dharam Pal Premchand v. Dharam Pal Premchand
Excerpt:
.....that in the case of workmen who are paid their salary and controlled by an office of a company, an industrial dispute wholly arises at the place where the office is situated, whether or not in fact the workers work at the place of the office or in a state outside the limits of that state where the office is situated. such a result is clearly not contemplated by the definition of 'industry' given in section 2(j). 8. learned counsel also submitted that in view of the decision of this court in misc. 2 working in the 'western division' to which d'silva belonged were members of this association on 25th august 1959 when the secretary of the association applied to the government for reference under section 10(1). the secretary made the application in the exercise of the power given to him under..........of the industrial tribunal, madhya pradesh in a reference made to it by the madhya pradesh state government under section 10(1) of the industrial disputes act, 1947 (hereinafter called the act) holding that as the state government was not the appropriate government for making the reference it was incompetent and consequently the tribunal had no jurisdiction to entertain the reference. they also pray that a direction be issued to the tribunal to entertain the reference and adjudicate on the merits of the dispute referred to it.2. the matter arises thus. the second petitioner d'silva was employed by the respondent no. 2, messrs. sarabhai chemicals karamchand premchand private ltd., (herein-after referred to as the company) as a medical representative or a 'detailer' for.....
Judgment:

Dixit, C.J.

1. By this application under Article 226 of the Constitution the petitioners seek a writ of certiorari for quashing the determination of the Industrial Tribunal, Madhya Pradesh in a reference made to it by the Madhya Pradesh State Government under Section 10(1) of the Industrial Disputes Act, 1947 (hereinafter called the Act) holding that as the State Government was not the appropriate Government for making the reference it was incompetent and consequently the Tribunal had no jurisdiction to entertain the reference. They also pray that a direction be issued to the Tribunal to entertain the reference and adjudicate on the merits of the dispute referred to it.

2. The matter arises thus. The second petitioner D'Silva was employed by the respondent No. 2, Messrs. Sarabhai Chemicals Karamchand Premchand Private Ltd., (herein-after referred to as the Company) as a medical representative or a 'detailer' for distribution and sale of the Company's products in Jabalpur, Sagar and Damoh districts and the districts of the former Vindhya Pradesh State. The Company manufactures pharmaceutical products known as 'Squibbs Products' at Baroda in the State of Gujarat and has its Head-Office at Bombay. As a medical representative the petitioner D'Silva was required to contact the members of the medical profession, hospital authorities, chemists etc., in the aforesaid area and acquaint them with the products of the Company, book orders from them and thus promote the sale and distribution of the products. He used to receive his salary and amount of Travelling Allowance bills etc., from the Bombay office of the Company and his work used to be controlled and supervised by the Bombay office. It appears that the Bombay office was not satisfied with the manner in which D'Silva discharged his duties. On 27th July 1959 the Bombay office of the Company addressed a letter to D'Silva terminating his services with immediate effect and giving him one month's salary in lieu of one month's notice. The first petitioner, namely, the Association of Medical Representatives, Nagpur, then took up the cause of D'Silva and by an application made under Rule 3 of the Central Provinces and Berar Industrial Disputes Rules, 1947, asked the Government to make a reference under Section 10 of the Act of the dispute that had arisen between the Association as representing one of its members, namely, D'Silva and the Company with regard to the termination of D'Silva's services. When this application was sent by the Government to the Assistant Labour Commissioner, Jabalpur, the Labour Commissioner informed D'Silva that as he had accepted monetary compensation from the Company in full and final settlement of his claim, nothing could be done in the matter of the application under the Industrial Disputes Act, 1947, for reinstatement and compensation. Thereupon, the petitioner moved this Court under Article 226 of the Constitution contending that the Assistant Labour Commissioner had no power whatsoever to pass any order finally disposing of the application presented by the petitioners and that the Government itself should have decided whether the application for the reference of the dispute should be granted or rejected. That application was allowed by this Court by its Order in Secy., Association of Medical Representatives v. Asst. Labour Commr., Jabalpur, Misc. Petn. No. 168 of 1961, dated 22-1-1962 (Madh Pra), and the State was directed to dispose of in accordance with law the petitioner's application dated 25th August 1959, for the making of a reference under Section 10 of the Act. Thereafter, the State Government made an order referring the dispute under Section 10(1) of the Act to the Tribunal for adjudication. The dispute referred to the Tribunal for decision was one said to be existing between the Company and the Association of Medical Representatives Nagpur, regarding the reinstatement of D'Silva who was in the employment of the Company and the Tribunal was required to adjudicate upon the question whether the termination of the employment of D'Silva was or was not justified and whether he was entitled to any relief.

3. Before the Tribunal the respondent No. 2 raised certain preliminary objections to the maintainability of the reference. The Company urged that the Madhya Pradesh Government was not the 'appropriate Government' for making a reference under Section 10(1) of the Act and that the dispute about the termination of D'Silva's services was an 'individual dispute' and not an 'industrial dispute' as defined in the Act and consequently the Government had no power to refer the same for adjudication. On the question as regards the competency of the Madhya Pradesh Government to make the reference, the Tribunal held that the Madhya Pradesh Government was not the 'appropriate Government' to refer the dispute in question as the Company did not carry on the industry within the State of Madhya Pradesh and also did not have any industrial establishment or undertaking within the State and that the State Government of Maharashtra was the 'appropriate Government' within the meaning of Section 2(a)(ii) of the Act in relation to the dispute in question. The Tribunal relied on Lipton Ltd. v. Their Employees, AIR 1959 SC 676. The Tribunal further found that the dispute referred to the Tribunal was an 'industrial dispute' and not an 'individual dispute' inasmuch as the dispute had been sponsored by the Association of Medical Representatives, Nagpur, which consisted of Medical Representatives of more than 60 industrial concerns engaged in the manufacture of medicinal drugs including the Company and out of the six medical representatives of the Company who were working in the 'Western Division in which D'Silva was working, four including D'Silva were members of the Association. It further found that the action of the Secretary of the Association in making an application on 25th August 1959 to the State Government for referring the dispute relating to D'Silva's termination of services was approved and ratified by the Executive Committee by its resolution dated 27th September 1959 and that under Article 12(iv) of the Constitution of the Association this resolution of the Executive Committee was valid and effective as a resolution passed by all the members of the Association at a General Meeting of the Association. In view of its decision on the question that the Madhya Pradesh Government was not competent to make the reference, the Tribunal did not think it necessary to deeide the question whether the termination of the employment of D'Silva was or was not justified.

4. Before us, the controversy centred round the aforesaid decision of the Tribunal on the two preliminary objections raised by the Company. Shri Jakatdar, learned counsel appearing for the petitioners, contended that the Madhya Pradesh Government was the 'appropriate Government' for making the reference for the reason that as the activity of D'Silva in pushing the sales of the Company's products in the area allotted to him was an activity in the State of Madhya Pradesh of the industry run by the Company and as the order terminating his services was enforced against D'Silva while he was in Madhya Pradesh, the cause of action giving rise to the industrial dispute arose within the State of Madhya Pradesh. Learned counsel said that on the lest laid down by the Supreme Court in Indian Cable Co., Ltd. Calcutta v. Their Workmen, (1962-63) 22 F. J. R. 262 (SC) it could not but be held that cause of action giving rise to the industrial dispute arose in part within the State of Madhya Pradesh. Learned counsel did not dispute that the Maharashtra Government had jurisdiction to refer the dispute under Section 10(1) as the order of termination of D'Silva's services was passed at Bombay and he was under the control of the Bombay office of the Company; but he said that the Madhya Pradesh Government had concurrent jurisdiction inasmuch as part of the cause of action giving rise to the dispute arose within the State of Madhya Pradesh.

5. In our opinion the Tribunal was right in concluding that the Madhya Pradesh Government was not the 'appropriate Government' for making a reference under Section 10(1) of the Act of the dispute regarding D'Silva's termination of services. Now, Section 10(1) does not contain any express provision as to which is the appropriate State Government for referring an industrial dispute in relation to which the State Government is the 'appropriate Government' as defined in Section 2(a)(ii) of the Act. The definition of 'appropriate Government' given in Section 2(a) is also not very helpful for determining the 'appropriate State Government'. But Section 10(1) does contemplate that the appropriate Government would be that Government in whose jurisdiction the industrial dispute arises or is apprehended when it says that 'where the appropriate Government is of opinion that any industrial dispute exists or is apprehended, it may at any time, by order in writing' make a reference. The definitions of 'Employer' and 'Workman' given in Section 2(g) and 2(s) show that an industrial dispute arises where the industry exists. In Indian Cable Co., Ltd. v. Their Workmen, (1962-63) 22 FJR 262 (SC) (supra) the Supreme Court noted that the Act contained no provision bearing on the question as to which of the States has jurisdiction under Section 10(1) to make a reference and held, approving the observations of Chagla C.J. in Lalbhai Tricumlal Mills Ltd. v. D.M. Vin, (1955-56) 9 F. J. R. 290 : (AIR 1955 Bom 463), that in deciding which of the States has jurisdiction to make a reference under Section 10 of the Act 'the well-known test of jurisdiction' should be applied; and that Court or Tribunal would have jurisdiction to entertain the reference within whose jurisdiction the parties reside or the subject-matter of the dispute substantially arises. This test only effectuates that which is contemplated by Section 10(1), namely, that it is the Government in whose jurisdiction the industry is situated that is competent to make a reference. Applying this test here, there can be no doubt that the Madhya Pradesh Government had no jurisdiction to make the reference. The petitioner was no doubt residing in Madhya Pradesh. The residence of the parties necessary to give jurisdiction must be in relation to the exislence of the industry. The Company was not carrying on business anywhere in Madhya Pradesh on the date of the reference. The dispute whether the Company was justified in dismissing D'Silva arose in Bombay inasmuch as the petitioner was employed by the Bombay office of the Company; he was paid by that office and his work was controlled and supervised by that office; and the dismissal order was also passed by the Bombay office.

6. The point of jurisdiction is really concluded by the decision of the Supreme Court in AIR 1959 SC 676 (supra) where it has been ruled that the Government of the State within which one of the offices of a Company is situated is the appropriate Government for referring any dispute between that Company and its workmen who are paid their salary and controlled by that office, irrespective of the fact that those workers work at a place which is outside the limits of that State. On this principle laid down by the Supreme Court in AIR 1959 SC 676 (supra) the Maharashtra Government was undoubtedly the appropriate Government for referring the dispute under Section 10(1).

7. If the Maharashtra Government was the appropriate Government to make the reference, then having regard to the very significance and meaning of the adjective 'appropriate' qualifying the word 'Government', no other Government can be called as the 'appropriate Government' for making the reference. If the decision of the Supreme Court in AIR 1959 SC 676 (supra) is read along with the subsequent decision in (1962-63) 22 FJR 262 (SC) (supra), then the effect of the observations of the Supreme Court in AIR 1959 SC 676 is clearly that in the case of workmen who are paid their salary and controlled by an office of a Company, an industrial dispute wholly arises at the place where the office is situated, whether or not in fact the workers work at the place of the office or in a State outside the limits of that State where the office is situated. The argument of learned counsel for the applicants that as the petitioner D'Silva was carrying on the work of pushing the sales of the respondent-Company in certain districts of Madhya Pradesh, therefore, the industry of the Company was also located in this State cannot be accepted for the reason that the said petitioner's activity in pushing the sales by itself, without there being any establishment of the Company in the State, was not an activity amounting to an undertaking of the Company within Section 2(j) of the Act according to the 'working principle' laid down by the Supreme Court in State of Bombay v. Hospital Mazdoor Sabha AIR 1960 SC 610. If the argument were to be accepted, it would lead to the strange result of making every roving salesman of the Company an undertaking having attributes of an industry within Section 2(j) of the Act. Such a result is clearly not contemplated by the definition of 'Industry' given in Section 2(j).

8. Learned counsel also submitted that in view of the decision of this Court in Misc. Petn. No. 168 of 1961 D/-22-1962 (Madh Pra) directing the State of Madhya Pradesh to dispose of in accordance with law the first petitioner's application of 25th August 1959 for the making of a reference under Section 10 the Company was now precluded from questioning the competency of the Madhya Pradesh State Government in making the reference. There is no substance in this contention. What this court held in its decision in Misc. Peln. No. 168 of 1961, D/-22-1962 (Madh Pra) was not that the State Government was competent to make the reference but that the Assistant Labour Commissioner had no power whatsoever to pass any order finally disposing of the application presented by the first petitioner on 25th August 1959 for a reference of the dispute under Section 10 and that the State Government should decide whether the reference prayed for by that petitioner should or should not be made. Thus, in that decision there was no adjudication whatsoever on the question of the competency of the State Government to make the reference. Pursuant to the direction given by the decision in Misc. Pctn. No. 168 of 1961 D/-22-1 1962 (Madh Pra), it was open to the State Government to reject the first petitioner's application for making a reference on the ground that it was not the appropriate Government to make a reference.

9. The reference made by the State Government under Section 10(1) of the Act was invalid also for the reason that what was referred to was an 'individual dispute' and not an 'industrial dispute' If has been held by l;te Supreme Court in numerous cases that a dispute between a single workman and the employer cannot be an industrial dispute unless it is taken up by the union of employees or a number of workmen. (See C. P T. Service Ltd. v. Raghunath Gopal Palwardhan. AIR 1957 SC 104 and The Newspapers Ltd, v. State industrial Tribunal, U. P., 1957 SCR 754: AIR 1957 SC 532. The case must be sponsored or espoused by the union of workmen in the same establishment or by a number of such workmen. The support by employees working in the same line but under different employers, in the absence of support by an appreciable number of employees in the same establishment, cannot convert an individual dispute into an industrial dispute. This is clear from the decision of the Supreme Court in Bombay Union of Journalists v. The 'Hindu' Bombay 1961-2 Lab L.I 436: (AIR 1963 SC 318). That was a case whore upon the termination of the services of one full-time employee at Bombay of the 'Hindu', a daily newspaper published in Madras, his case was espoused by the Bombay Union of Journalists and the State of Bombay referred the dispute under Section 10 for adjudication. The Union had other journalists working in different establishments as its members. The Supreme Court accepted the contention of the employer that the reference was invalid inasmuch as the dispute referred for adjudication was an 'individual dispute' and not an 'industrial dispute'. It was observed by the Supreme Court :

'The dispute between the 'Hindu' Bombay and Salivaleeswaran was in respect of alleged wrongful termination of employment; it could acquire the character of an industrial dispute only if it was proved that ii was. before it was referred, supported by the union of the employees of the 'Hindu', Bombay or by an appreciable number of its employees.'

xxxxx

'The principle that the persons who seek to support the cause of workman must themselves be directly and substantially interested in the dispute in our view applies to this class of cases also; persons who are not employees of the same employer cannot be regarded as so interested, that by their support they may convert an individual dispute into an industrial dispute. The mere support to his cause by the Bombay Union of Journalists cannoi therefore assist the claim of Salivateeswaran so as to convert it into an industrial dispute.'

10. Here also, the dispute about D'Silva's termination of a service was prima facie an individual dispute. It was not sponsored by any union of the employees of the respondent-Company or by an appreciable number of its employees As has been found by the Tribunal, the first petitioner Association which espoused the cause of the second petitioner is an Association consisting of medical representatives of more than 60 different industrial establishments and four medical representatives only of the respondent No. 2 working in the 'Western Division' to which D'Silva belonged were members of this Association on 25th August 1959 when the Secretary of the Association applied to the Government for reference under Section 10(1). The Secretary made the application in the exercise of the power given to him under Article 12(iv) of the Constitution of the Association His action was ratified by the Executive Committee by passing a resolution on 27th September 1959. The support thus given by the Association to the individual dispute regarding D'Silva was clearly not the support of any union of the employees of the respondent-Company, and, as held by the Supreme Court in (1961) 2 Lab LJ 436: (AIR 1963 SC 318) (supra), that support could not convert the said individual dispute into an industrial dispute. The Tribunal, however, took the view that the dispute was supported by an appreciable number of the employees of the respondent-Company. The reasoning of the Tribunal was on these lines: The respondent-Company had six medical representatives in the Western Division; four of them were members of the first petitioner-Association; under Article 12(iv) of the Constitution of the Association the resolution of the Executive Committee passed on 27th September 1959 ratifying the Secretary's action in making an application for reference under Section 10(1) was valid as if it had been passed at a General Meeting of the Association by all the members of the Association; therefore, four out of the six medical representatives of the respondent-Company working in the 'Western Division' had supported the cause of D'Silva; and this support was by an appreciable number of the employees of the respondent-Company. The flaw in the reasoning lies in taking the resolution of ratification passed by the Executive Committee of the Association as indicative of the support of D'Silva's cause individually by each of four employees of the respondent-Company who were members of the Association. There is no justification for equating this ratification of the resolution with the individual support of the four employees of the respondent-Company who were members of the Association. When according to the principle laid down by the Supreme Court in (1961) 2 Lab LJ 436 : (AIR 1963 SC 318) (supra), the support given by the first petitioner-Association to the individual dispute is utterly ineffective in order to convert it into an industrial dispute, then the question whether an appreciable number of the representatives of the respondent-Company working in the 'Western Division' did or did not suport the cause of D'Silva must be determined de hors that resolution. There is nothing on record to show that out of the six medical representatives of the respondent-Company working in the 'Western Division', an appreciable number of them did in fact support the individual dispute. Again, there is also nothing to show that the medical representatives of the respondent-Company who were members of the Association were actually present at the meeting at which the Secretary's action was ratified and supported that resolution. Article 12(iv) of the Constitution on which the Tribunal relied only fictionally treats a resolution passed by the Executive Committee as a resolution passed at a General Meeting of the Association by all the members of the Association. This fiction cannot be resorted to for determining the question whether the four medical representatives of the respondent-Company who were members of the Association factually support the action of the Secretary of the Association in making an application for reference under Section 10(1) and thus factually supported the cause of D'Silva.

11. Shri Jakatdar, learned counsel for the applicants, referred us to the decision of the Supreme Court in Workmen of Messrs. Dharam Pal Premchand v. Dharam Pal Premchand (1966) 2 SCJ 818: (AIR 1966 SC 182) and contended that in view of the comment made by the Supreme Court in the case on its earlier decision in (1961) 2 Lab LJ 436: (AIR 1963 SC 318) (supra) the principle laid down in the latter case should net be applied to the case before us. We do not agree. It is true that in (1965) 2 SCJ 818: (AIR 1966 SC 182) (supra) the Supreme Court said that in view of the finding in the case of 1961-2 Lab LJ 436: (AIR 1903 SC 318) that there was no reliable evidence to show that the union had taken up the case of the retrenched employee there, the observations made in the case of 1961-2 Lab LJ 436: (AIR 1963 SC 318) in regard to the requirements of a valid reference under Section 10(1) of the Act were in the nature of obiter observations. But the Supreme Court has nowhere in (1965) 2 SCJ 818: (AIR 1966 SC 182) dissented from the observations in 1961-2 Lab LJ 436: (AIR 1963 SC 318). In (1965) 2 SCJ 818: (AIR 1966 SC 182) the Supreme Court dealt with the case of dismissal of 18 out of 45 employees by an order passed by an employer on one and the same day and pointed out that the observations made in 1961-2 Lab LJ 436: (AIR 1963 SC 318), cannot be extended or applied to a case where the workmen of an establishment have no union of their own or where the number ef workmen dismissed by an order passed on the same day was large enough to hold that they themselves formed a group of workmen raising the dispute about dismissal. The Supreme Court said:

'If 18 workmen are dismissed by an order passed on the same day, it would be unreasonable to hold that they themselves do not form a group of workmen which would be justified in supporting the cause of one another.'

In the present case, we are concerned with the dismissal of a single employee and it is not the stand of any party before us that the employees of the respondent-Company have no union of their own. In these circumstances, the question whether the support of the first petitioner-Association converted the individual dispute into an industrial dispute must, in our view, be decided with reference to the decision of the Supreme Court in 1961 2 Lab LJ 436: (AIR 1963 SC 318) (supra).

12. For the foregoing reasons, the decision of the Tribunal holding that the reference made to it by the Madhya Pradesh State Government under Section 10(1) of the Act is invalid must be sustained.

13. The result is that this petition fails and is dismissed with costs of the respondent No. 2. Counsel's fee is fixed at Rs. 150/-.

14. The outstanding amount of the security deposit after deduction of costs shall be refunded to the petitioners.


Save Judgments// Add Notes // Store Search Result sets // Organizer Client Files //