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Guru Charan Mohanty Vs. Mgt. of Orissa Commercial Transport Corpn. Ltd. and anr. - Court Judgment

LegalCrystal Citation
SubjectLabour and Industrial
CourtOrissa High Court
Decided On
Case NumberO.J.C. No. 4291/1992
Judge
Reported in(1994)ILLJ1106Ori; 1993(II)OLR231
ActsIndustrial Disputes Act, 1947 - Sections 33A and 33(2)
AppellantGuru Charan Mohanty
RespondentMgt. of Orissa Commercial Transport Corpn. Ltd. and anr.
Appellant AdvocateB.B. Ratho, Adv.
Respondent AdvocateJ.K. Tripathy, Adv. for Opp. Party No. 1 and ;Addl. Govt. Adv. for Opp. Party No. 2
DispositionPetition allowed
Cases ReferredFederation v. Punjab National Bank Ltd.
Excerpt:
.....to new entrants. it was observed that like nature, law abhors a vacuum and even on the notice of termination under section 19 (2) or (6), the sequence and consequence cannot be just void but a continuance of the earlier terms, but with liberty to both sides to raise disputes, negotiate settlements or seek a reference and award. an example brings home the position with better clarity. it is well settled that so far as a case under section 33-a is concerned, it is identical to that of a dispute before the tribunal and has to be decided as such. karimbhai) the observation made was that for the purposes of the act, the complaint under section 33-a takes the form of a reference of an industrial dispute by the appropriate authority and the same has to be disposed of in a like manner. 9...........bahadur) where exposing the three stages or phases with different legal effects in the life of an award or settlement as being the period of operation which is either contractually or statutory fixed, then the period during which the award or settlement does not become non est, but continues to be binding, and the last phase being the period after expiry of the two months of notice given to terminate the award or settlement, it was said that so far as the last phase is concerned, the award or settlement does survive thereafter and remains in force between the parties as a contract which has superseded the earlier contract and subsists until a new award or negotiated settlement takes place. it was observed that like nature, law abhors a vacuum and even on the notice of termination under.....
Judgment:

L. Rath, J.

1. An interesting and important question arises in this case for consideration. Do the workmen involved in an industrial dispute raised by the union on their behalf on ac-count of their dismissal from service in violation of Section 33 of the Industrial Disputes Act, 1947 (hereinafter referred to as 'the Act') have a remedy under Section 33-A if the dispute is compromised by the union with the management behind their back in a fraudulent manner? The petitioner was a driver under opp. party No. 1-management. During the pendency of the I.D. Case No. 51/83 before the Industrial Tribunal relating to scale of pay of heavy vehicle drivers like the petitioner, he was charge-sheeted by the management for absence from duty and on the basis of the result of a domestic inquiry his service was terminated on February 8, 1984. It is the case of the petitioner that in passing the order of discharge the prior approval of the tribunal was not taken and hence the order was hit by the provisions of Section 33(2) of the Act I.D. Case No. 51/83 was decided on December 3, 1984. Since during the pendency of the proceeding before the Tribunal the services of a number of workman including the petitioner had been terminated, a reference was made by the Government to the Tribunal registered as I.D. Case No. 56 of 1985 on the question whether the termination of services of the employees was legal and/or justified and if not, to what relief they were entitled. That case was disposed of by award passed on October 30, 1986 on the basis of a compromise entered into on October 16, 1986 between the management opp. party No. 1 and the Orissa State Commercial Transport Corporation Employees' Union, second party to the dispute, the terms of settlement being that excluding the case of two employees, i.e. B.C. Patnaik and Mahendra Kumar Mohanty, who had been reinstated in their former posts, the case of other employees listed at Serial No. 1 of the dispute case would be considered for appointment as fresh persons in future when vacancies would arise in the Corporation and that they had already received their gratuity under Section 4 of the Gratuity Act as also the terminal benefits under Section 25-F of the Act. So far as the petitioner and persons like him mentioned at Sl. No. 2 of the Dispute Case were concerned, the terms of settlement was that they had been discharged from service on account of proven misconduct in domestic inquiry complying with principles of natural justice and conducted affording them all opportunities to defend themselves, that they had been paid their legal dues as per the certified standing orders and Gratuity Act, 1972, and therefore their relationship as employees had ceased from the date of receipt of gratuity, and as such the question of their reinstatement did not arise but that in future when vacancies would arise, their fresh appointment might be considered on merit. A notice was issued by the union on August 16, 1988 for termination of the settlement as well as the award and thereafter on November 28, 1988 the application under Section 33-A of the Act was filed alleging that the settlement made in the I.D. Case No. 56/85 was unfair and illegal and had been reached without consideration of the question of reinstatement of the petitioner and payment of his back wages and that the management had even failed to act in accordance with the terms of the compromise having not given re-employment to the petitioner and instead giving appointment to new entrants. It was also urged that the original order of discharge from service was illegal being in violation of Section 33(2) of the Act as also the domestic inquiry not having been properly conducted. The application was registered as I.D. Misc. Case No. 12/88. The move by the petitioner was resisted by the opp. party No, 1, contending that the petitioner had been proceeded against in a proper inquiry and was discharged having been found guilty on inquiry and the very question as raised under Section 33-A was the subject-matter of I.D. Case No. 56/85 which was disposed of in terms of the settlement. The question having been decided by a competent Tribunal was not available to be re-agitated in fresh proceeding.

2. In considering the case of the petitioner, the Tribunal reached the findings that so far as I.D. Case No. 56/85 was concerned, it was conducted in a patently unjust manner so far as the petitioners and the likes of him were concerned inasmuch as even though a written statement was filed by the General Secretary of the Union for eight workmen, no written statement was filed on their behalf. Further, a scrutiny of settlement made showed that the two office bearers of the Union who were representing the case had joined hands with the management and got the case disposed of on terms of compromise with a view to only benefitting two out of the seventeen affected workman and the fifteen other workmen were kept hanging at the mercy of the management and that there was a doubt whether these workmen had ever been consulted by the Union representatives before the compromise was filed in Court. The further conclusions reached were that the circumstances indicated that the management had effected a compromise which it knew to be non-executable, had entered into the same in a heartless manner and that grave injustice had been done to the workmen by getting the reference compromised by deceitful means. The ultimate conclusion of the tribunal was that from the facts and circumstances of the case it transpired that the management, either by influencing the Union leaders or with their connivance, had put an end to the life of the workmen by imposing upon them an economic death sentence and that while he did not appreciate the illegal and mala fide section of the management yet had no other option but to dismiss the complaint with the observation that the workmen, if so advised, might approach the proper Court of law and seek relief.

3. Mr. Ratho, learned counsel for the petitioner, has made the two-fold submission that the effect of the compromise was no longer available as a defence to the opp. party No. 1 its period of operation having expired and thereafter notice terminating the settlement and the award having been given and two months having expired from that date; and that an application under Section 33-A, whenever it lies, is to be treated in all respects as an industrial dispute referred to by Government under Section 10(1) and hence the tribunal deciding such an application had all the powers of an Industrial Tribunal including the powers to set at naught the effect of compromise which was vitiated by fraud as also the award based upon it. As the Tribunal reached the conclusion of the compromise being unfair and to have been made behind the back of the petitioner by conniving with the management, it was incumbent on its part to have granted the relief of reinstatement of the petitioner in service. The conclusion of the Tribunal of its lack of jurisdiction in the matter was legally not correct It is on the other hand the submission of Mr. Tripathy, the learned counsel for opp. party No. 1, that when a workman is affected by an illegal order of discharge or dismissal from service without the approval of the Tribunal during the pendency of a proceeding before it, he has the option of three remedies, one to have his cause raised as an industrial dispute before the Tribunal through a reference made by Government, or raise it before the Tribunal as a dispute under Section 2-A or to come before the Tribunal under Section 33-A. In the present case, the petitioner having chosen the first remedy of getting his cause espoused by the union before the Tribunal and advanced as an industrial dispute and the very question of legality or otherwise of the order of discharge having been decided against him on compromise by the union that the order of discharge was valid and proper with full opportunity given to him in the domestic inquiry and after following the principles of natural justice, the question was not available to be re-agitated again in an application under Section 33-A. It is also his submission that the validity of the award discharging the petitioner from service continues to be operative and binding between the parties notwithstanding the notice given for terminating the award and the settlement.

4. Section 18 of the Act declares inter alia a settlement between the parties otherwise than in a conciliation proceeding and any award rendered by the tribunal to be binding between the parties to the agreement or between the panics to the dispute. Section 19 stipulates the periods the settlement or the award remaining binding. Under Sub-section (2) of that section the settlement remains binding for six months unless some other period is agreed to by the parties and continues to remain binding after such period till after two months of any notice given to terminate the settlement. An award likewise is provided under Sub-section (3) to remain binding for one year from the date of its enforceability subject to reduction or extension of the period by the Government as provided under the proviso to the sub-section and under Sub-section (6), the binding effect of the award continues even after expiry of its operational period under Sub-section (3) till expiry of two months from the date of notice given by one party to the other intimating its intention to terminate the award. A reading of the provisions shows that the award and the settlement remain operative even after expiry of the period fixed under the statute as their operational periods. A notice by one party to the other terminating the settlement or the award does not ipso facto put an end to their binding effect but only declares the intention of the party issuing the notice that it wants to terminate the settlement or the award. The effect of the notice is to free the party giving the notice to raise the dispute again for adjudication and in a proceeding so commenced, to deprive the party receiving the notice of the defence of there having been an earlier settlement or award on the issues involved. Beyond that, no consequence ensues either on expiry of the periods of operations, or two months' expiry after the notice is given. The question was examined in (1981-I-LLJ-l) (L.I.C. of India v. D.J. Bahadur) where exposing the three stages or phases with different legal effects in the life of an award or settlement as being the period of operation which is either contractually or statutory fixed, then the period during which the award or settlement does not become non est, but continues to be binding, and the last phase being the period after expiry of the two months of notice given to terminate the award or settlement, it was said that so far as the last phase is concerned, the award or settlement does survive thereafter and remains in force between the parties as a contract which has superseded the earlier contract and subsists until a new award or negotiated settlement takes place. It was observed that like Nature, law abhors a vacuum and even on the notice of termination under Section 19 (2) or (6), the sequence and consequence cannot be just void but a continuance of the earlier terms, but with liberty to both sides to raise disputes, negotiate settlements or seek a reference and award. Until such a new contract or award replaces the previous one, the former settlement or award will regulate the relations between the parties. If an application under Section 33-A is otherwise maintainable, the first submission of Mr. Ratho that the earlier settlement and award would not be available as a defence against the application, hence is to be sustained.

5. But the more important question is as to whether an application under Section 33-A is maintainable. Mr. Tripathy has raised the question that where in a previous proceeding before a competent forum a finding has been reached as to the validity or invalidity of a particular action taken against an employee, such question is not open to be reagitated again even if the issues of the earlier awards become revivable for settlement or decision after the expiry of the operational period of the award. It is the submission that both the settlement and the award held the order of discharge of the petitioner to be valid and held him to have been visited with punishment after affording him all opportunities to defend himself which were findings of fact continuing to be operative and binding on the parties and by merely giving a notice under Section 19 (2) or (6) of the Act, the findings are not available to be set at naught and raised again for dispute.

6. The contesting propositions advanced invoke a deeper analysis. Where the existence or non-existence or validity or invalidity of any fact situation is determined between the parties either by way of a settlement or an award, say for instance, whether a particular scale of pay was existing at a time or not or whether a dismissal was valid or not, as distinguished from any settlement or determination creating continuing rights or obligations, it must be taken that the decision so rendered or the agreement so reached is binding and conclusive between the parties and is not available to be varied in pursuance of a notice given to terminate the settlement or the award. The cause of action for the award or the settlement in such cases is determined between the parties finally and can no longer be re-opened. But to such general principles there is an important exception, that the finding or settlement is open to be questioned on the ground of fraud or mala fide. It is a part of the common law that fraud or mala fide vitiates all actions and hence it is open to any party to plead that the settlement or the award was not genuine or had become vitiated due to such practice. This is the general principle of law which remains always applicable to all acts between parties or to acts of a Court or a tribunal. Between the parties the principle is applicable since the presumption of voluntary participation of the parties to reach the settlement is absent because of the fraud or mala fide practiced and becomes applicable to the verdict of adjudicating authorities since the decision is given not on genuine set of facts but on the basis of coloured and tainted version. An example brings home the position with better clarity. A compromise decree between two parties is always available to be challenged in a subsequent suit on the plea of fraud having been practiced in reaching the compromise. Similarly, either a settlement reached or an award rendered by a tribunal is open to be questioned as having been the outcome of fraud or mala fide practised on one party or upon the tribunal. The Government could always be moved to refer the question as a dispute to the tribunal to decide whether the award was vitiated by fraud, and if it was a case of discharge, dismissal, retrenchment or termination otherwise, even the affected workman could raise on individual dispute in the matter within the scope of Section 2-A.

7. Section 33-A on its own term declares that where complaint is made inter alia to a tribunal that during the pendency of a proceeding before it the employer has contravened the provisions of Section 33(2), it shall adjudicate upon the complaint as if it is a dispute referred to or pending before it and that the decision rendred by it shall be an award which is to be submitted to Government and that the provisions of the Act shall apply to it accordingly. It is well settled that so far as a case under Section 33-A is concerned, it is identical to that of a dispute before the tribunal and has to be decided as such. In (1977-I-LLJ-407) (Bhavnagar Municipality v. A. Karimbhai) the observation made was that for the purposes of the Act, the complaint under Section 33-A takes the form of a reference of an industrial dispute by the appropriate authority and the same has to be disposed of in a like manner. The tribunal commits an error of jurisdiction if it declines to adjudicate the matter and make its award on the merits as required under the law.

8. Undoubtedly, as is also conceded by Mr. Tripaty, the petitioner could have at the very first instance filed an application under Section 33-A to challenge the order of his discharge from service it having been done during the pendency of the Industrial Dispute Case No. 51 of 1983. Instead his cause was moved in a collective manner by the union in Industrial Dispute Case No. 56/85. That case having been disposed of without giving any reasons, he came before the tribunal complaining of the same as having been obtained by practising fraud. Such an application could have been made by him either under Section 2-A or Section 33A or he could have also got moved the Government by the Union to refer such dispute to the tribunal under Section 10. Mr. Tripathy fairly concedes that even after the award was passed on settlement it was open to any of the parties to raise a dispute before Government of the award having been vitiated by fraud and such dispute was capable of having been referred to the Tribunal. Since that is so, there is really no distinctive reason as to why the same logic would not apply to an application under Section 33-A of the Act It has to be held as a logical corollary that under the circumstances, an application under Section 33-A could have been made even during the period the award and settlement were subsisting as binding on the panics, it being the case of the petitioner that in effect there never was any genuine settlement or award.

9. The Tribunal on a consideration of the facts of the case came to hold that both the earlier settlement and the award were in fact brought into existence due to fraud practised upon the petitioner and persons like him and that it was a product of connivance between two representatives of the union and the management where the interest of the petitioner and persons like him were sacrificed. On such findings the tribunal had the further jurisdiction to declare the award to be vitiated and not binding on the parties and pass a fresh award giving such relief to the petitioner as was found due. The Tribunal was in error to hold that it lacked jurisdiction for the purpose.

10. Having reached the conclusions, yet the petitioner does not become entitled straightway to the reliefs claimed. Where a workman has been punished or discharged in contravention of the provisions of the Section 33(2), he does not become automatically entitled to the relief claimed by taking out a proceeding under Section 33-A. Since the proceeding is in the nature of a dispute raised before the tribunal, the employer has still the right to persuade the tribunal that the discharge or the other punishment was proper and if such question is raised, the tribunal has the duty to decide the matter on merits. In (1959-II-LLJ-666) (Punjab National Bank Employees' Federation v. Punjab National Bank Ltd.) the Court observed that there can be no doubt that in an enquiry under Section 33-A the employee would not succeed in obtaining an order of reinstatement merely by proving contravention of Section 33 by the employer. After such contravention is proved it would still be open to the employer to justify the impugned dismissal on merits. This is a part of the dispute which the tribunal has to consider because the complaint made by the employee is treated as an industrial dispute and all the relevant aspects of the said dispute fall to be considered under Section 33-A.

11. The tribunal has not approached the question from such angle. There is no finding reached in that regard nor does the employer appear to have been given opportunity to justify its action against the petitioner as valid.

12. In that view of the matter, the petition succeeds. The award of the tribunal vide Annexure-2 is set aside and the matter is remanded to it for fresh adjudication in accordance with the observations made. Hearing fee is assessed at Rs. 500/-.

R.K. Patra, J.

13. I agree.


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