G.K. Misra, C.J.
1. The petitioner's case may be stated in short. The Mazdoor Sangh (petitioner) under M/s. Titaghur Paper Mills No. 3 at Choudwar (opposite party No. 2) was registered as a trade union on 12-10-1968. The total strength of permanent workmen under opposite party No. 2 is about 1164 and out of them 712 workmen are members of the petitioner-union. The Titaghur Paper Mills Workers' Union (opposite party No. 3) is the rival union of workmen under opposite party No. 2. An industrial dispute between opposite party No. 2 and opposite party No. 3 was referred by the State of Orissa (opposite party No. 4) to the Presiding Officer, Industrial Tribunal (opposite party No. 1) on 5-4-69 for adjudication. The reference was numbered as Industrial Dispute Case No. 13 of 1969. The dispute was as follows:
Whether the existing wage structure of the employees of Titaghur Paper Mills No. 3 at Choudwar in the District of Cuttack needs any revision. If so, what should be the details.
2. In West Bengal opposite party No. 2 owns two other mills, namely, Titaghur Paper Mills Nos. 1 and 2 which are under the same management and in every respect there is functional integrality amongst these three mills. There was a demand for revision of wage structure of all the three mills in respect of basic wages. There was a flat increase of about Rs. 34 per monthsettled by a tripartite agreement in August 1969 in the Bengal Mills. The petitioner apprehending same collusive move between opposite parties 2 and 3 made an application under Section 18(3)(b) of the Industrial Disputes Act, 1947 (hereinafter to be referred as the Act) to opposite party No. 1 praying for being impleaded as a party in Industrial Dispute Case No. 13 of 1969. The application (Annexure A) was sent by registered post on 7-10-1969 and was received by opposite party No. 1 on 8-10-1969. Opposite parties 2 and 3 came to a settlement on 11-10-1969. Under that settlement a flat increase of Rs. 14 in basic wages, Rs. 3 in the base D.A. and Rs. 2 in the house allowance was provided. It was agreed in the said settlement that the parties would file a joint application before opposite party No. 1 praying for an award in terms of the settlement and that the settlement would be binding for three years. The demand for incentive bonus, quarters, etc. was not pressed and a gratuity scheme which was agreed upon in the said settlement was more in favour of the management. The settlement arrived at was unjust and unfair.
3. Besides the aforesaid dispute, there were two other dispute cases-I.D. Case No. 35 and No. 39 of 1969. Similar applications were made by the petitioner for being impleaded as a party in those cases. Notice was given to opposite parties 2 and 3 who filed their objections. The application for being impleaded as a party was rejected by opposite party No 1 on 27-12-1969. The orders passed in I.D. Cases Nos. 35 and 39 of 1969 were communicated to the petitioner on 13-1-1970 against which the petitioner filed O.O.C. Nos. 75 and 74 of 1970 on 21-1-1970. But the order dated 27-12-1969 in I. D. Case No. 13 of 1969 was communicated to the petitioner only on 24-1-1970 which was received by the petitioner on 29-1-1970. Unlike in other two cases the complete order passed in I. D. Case No. 13 of 1969 was not communicated to the petitioner. The last two sentences (Annexure B) of the said order were issued to the petitioner. On further request a copy of the complete order (Annexure C) was supplied to the petitioner on 31-1-1970. On 27-12-1969 opposite party No. 1 passed the award in terms of the settlement. The writ application has been filed under Articles 226 and 227 of the Constitution for quashing the order dated 27-12-1969 (Annexure C) and the award (Annexure 1 to counter-affidavit filed by opposite party No. 2).
4. Opposite parties 2 and 3 contest the writ application. Their case is more or less the same. Their case may be stated in short. According to them only opposite party No. 3 represents the workmen; the functional integrality of the three Titaghur Paper Mills is denied; the condition in West Bengal is different from that in Orissa; the petitioner was put to strict proof of the fact that the application by the petitioner for being impleaded as a party was sent by registered post on 7-10-1969 which was received by opposite party No. 1 on 8-10-1969 ; the settlement is said to be not collusive and is bonafide. Itwas alleged that while the aforesaid reference was pending opposite party No. 3 placed another charter of demands dated 4-9-1969 on the eve of the Puja festival asking for an ad hoc increase of Rs. 40 per month in the basic wage of workmen and members of the staff along with other demands of bonus for the year 1968-69 and increase in house allowance, etc., and sent copies to the Government of Orissa, Labour Commissioner and Assistant Labour Commissioner. This gave rise to industrial unrest and at the intervention of the Assistant Labour Commissioner the conciliation proceeding started. Through the good offices of the conciliation officer after protracted negotiation the parties settled the matter in order to promote and maintain industrial peace and harmony between the management and workmen. The conciliation settlement of October, 1969, has been fully implemented since 11-9-1969 and all workmen including the petitioner working under opposite party No. 2 received benefits mentioned in the conciliation settlement. The petitioner is precluded from raising objection after receipt of benefits. The award given by the Tribunal is based on the conciliation settlement and is binding on all workmen and the petitioner is estopped from challenging the settlement award on any ground whatsoever. The petitioner does not represent the majority of workmen.
5. One controversial fact in this case was whether the application for being impleaded as a party was sent by the petitioner on 7-10-1969 which was received by opposite party No. 1 on 8-10-1969. The records of the Tribunal were called for to verify this fact. The records clearly support the petitioner's case. The application was despatched on 7-10-1969 and the same has been endorsed by Shri Raghav Rao, Presiding Officer, Industrial Tribunal, on 8-10-1969. The Tribunal, therefore, committed an error of record in saying that the application for being impleaded as a party was filed subsequent to the petition for settlement filed by opposite parties 2 and 3.
6. Mr. Rath for the petitioner advanced the following contentions:
(i) The impugned order, dated 27th December, 1969, rejecting the petitioner's application to be impleaded as a party is illegal and contrary to the rules of natural justice as every workman individually or any union representing a class of workmen is a necessary party to an industrial dispute which affects them.
(ii) The award giving an interim flat rate increase on the basis of the settlement between opposite parties 2 and 3 does not answer the reference made under Section 10(1)(d) read with Section 12(5) of the Act. The flat rate increase for a three-year period in basic wage does not cover a dispute of a comprehensive nature like the determination of the wage structure. Thus the Tribunal failed to exercise the jurisdiction vested in it.
(iii) The settlement between opposite parties 2 and 3 may be taken into consideration in giving an award; but the Tribunal cannot base the award on the settlement unless it considers the settlement to be bona fide and fair. The Tribunal failed to exercise its jurisdiction in not recording such a finding.
(iv) The settlement arrived at in this case was not in course of a conciliation proceeding and as such is not binding on the workmen who are not parties to the settlement.
(v) Even if the settlement be held to have been effected through a conciliation officer under Section 12 of the Act, the conciliation officer has no jurisdiction to effect a settlement over a dispute which was pending before the Tribunal on the failure of the earlier conciliation proceeding.
7. Mr. Mohanty besides combating all the aforesaid propositions contends that as the award has been published and enforced and the petitioner received benefits thereunder it is estopped from challenging the award.
8. The writ application can be effectively disposed of by examining the following questions:
(i) Did the Tribunal fail to exercise the jurisdiction vested in it by rejecting the petitioner's application to be impleaded as a party ?
(ii) Is the petitioner estopped from challenging the award as it has derived benefits under the same inasmuch as the flat rate increase for a three-year period in basic wage is also applicable to its case ?
(iii) Is the writ application not maintainable as the award has already been published ?
9. In The Manager, Hotel Imperial, New Delhi v. The Chief Commissioner, Delhi and Ors. 1959-II L.L.J. 553 : A.I.R. 1959 S.C. 1214, the dispute which was referred for adjudication was between the management of the Hotel Imperial, new Delhi and its workmen as represented by the Hotel Workers' Union, Katra Shahanshahi, Chandni Chowk, Delhi. An objection was raised that the words 'as represented by the Hotel Workers' Union, Katra Shahanshahi, Chandni Chowk, Delhi' make the order of reference incompetent inasmuch as the union could not be made a party to the reference. Their Lordships said that addition of these words was merely for the sake of convenience so that the Tribunal may know to whom it should give notice when proceeding to deal with the reference. The following observations of their Lordships in course of discussion are pertinent:
That, however, did not preclude the workmen, if they wanted to be represented by any other union, to apply to the Tribunal for such representation or even to apply for being made parties individually.
10. The position of law has been authoritatively pronounced in Hochtief Gammon v. Industrial Tribunal, Bhubaneshwar 1964-II L.L.J, 460 : A.I.R. 1964 S.C. 1746. In that case an industrial dispute in regard to the payment of bonus arose between the appellant Hochtief ] Gammon and the respondents, its workmen, represented by the Rourkela Workers' Union. A notice of the reference was served on the Deputy General Manager of M/s. Hindustan Steel Ltd. who raised an objection that it was not concerned or interested in the dispute and should not be added as a party to the reference. The appellant, however, said that Messrs. Hindustan Steel Ltd. was a necessary party. To determine the question whether Messrs. Hindustan Steel Ltd. should be joined as a party to the reference their Lordships examined the scope and ambit of Sections 10(1)(d),10(4), 10(5), 11(3) and 18(3)(b) of the Act. After thorough analysis the following conclusions were reached:
(i) Persons other than parties to the industrial dispute can be summoned before the Tribunal to be made parties.
(ii) There is no express provision in the Act conferring power on the Tribunal to summon persons other than parties. Section 18(3)(b) postulates that the Tribunal has an implied power to summon parties, other than parties to the industrial dispute, to appear in the proceedings before it.
(iii) In that regard the power to be exercised by the Tribunal is, however, of a limited nature. It is not open to the Tribunal to travel materially beyond the terms of the reference which determine the scope of its power and jurisdiction. The jurisdiction of the Industrial Tribunal would be confined to points of dispute specified by the order of reference and to points and matters incidental thereto.
(iv) Those persons would be impleaded as parties whose addition is necessary to make the adjudication effective and enforceable or in whose absence the proceeding would be ineffective and unenforceable.
11. In paragraph 12 of the judgment their Lordships put their conclusion thus:
If it appears to the Tribunal that a party to the industrial dispute named in the order of reference does not completely or adequately represent the interest either on the side of the employer, or on the side of the employee, it may direct that other persons should be joined who would be necessary to represent such interest. If the employer named in a reference does not fully represent the interests of the employer as such, other persons who are interested in the undertaking of the employer may be joined. Similarly, if the unions specified in the reference do not represent all the employees of the undertaking, it may be open to the Tribunal to add such other unions as it may deem necessary. The test always must be, is the addition of the party necessary to make adjudication itself effective and enforceable? In other words, the test may well be, would the non-joinder of the party make the arbitration proceedings ineffective and unenforceable It is in the light of this test that the implied power of the Tribunal to add parties must be held to be limited.
12. The contention of Hochtief Gammon was that its liability for bonus if established by the workmen would be the ultimate liability of Messrs. Hindustan Steel Ltd. On the aforesaid principles their Lordships held that such a dispute between the appellant and Messrs. Hindustan Steel Ltd. will be wholly foreign to the industrial dispute which was referred to the Tribunal. The petition for addition of parties was accordingly rejected.
13. As has already been stated, the petitioner was registered as a trade union on 12-10-68, long before the industrial dispute was referred to the Tribunal on 5-4-69. The petitioner and opposite party No. 3 were the two registered unions each one having an objective to foster the cause of workmen in collective bargaining with opposite party No. 2. In its application, dated 7-10-69, which was received by the Tribunal on 8-10-69, the petitioner wanted to be impleaded as a party apprehending that its interest would be jeopardised by some settlement between opposite parties 2 and 3. The alleged settlement between opposite parties 2 and 3 was effected on 11-10-69. The compromise petition was filed before the Tribunal to dispose of the reference in terms of the settlement about a month later on 8-11-69. The industrial dispute which was before the Tribunal for adjudication cannot be effectively disposed of in the absence of the petitioner which was vitally interested in the determination of the wage structure and was not inclined to accept an ad hoc increase in the basic wage. The non-joinder of the petitioner would make the adjudication ineffective and unenforceable. The petitioner had, therefore, clearly a right of hearing against the settlement. Doubtless it was open to the Tribunal to reject the petitioner's stand on reasonable and cogent grounds after hearing, but it would be difficult to accept the Tribunal's view that the petitioner is not entitled to a hearing and is not a necessary party to the reference. We are satisfied that the Tribunal exercised its jurisdiction illegally in rejecting the application dated 7-10-69 for impletion of parties. It failed to exercise the jurisdiction vested in it by the commission of an error of record as if the application for impletion of parties was filed subsequent to the settlement.
14. Reliance has been placed by Mr. Mohanty on Ramnagar Cane and Sugar Co. Ltd. v. Jatin Chakravorty and Ors 1961-I L.L.J. 244 : A.I.R. 1960 S.C. 1012; New India Motors (P.) Ltd., New Delhi v. K.T. Morris 1960-I L.L.J. 551: A.I.R. 1960 S.C. 875, and State of Bihar v. D.N. Ganguly and Ors. 1958-II L.L.J. 634 : A.I.R. 1958 S.C. 1018, for the contrary view. None of these decisions throws any light on the question in issue.
15. In Ramnagar Cane and Sugar Co. Ltd. v. Jatin Chakravorti and Ors. (supra), the construction and effect of the provision of Section 22(1)(d) of the Act came up for consideration. That provision is to the effect that no person employed in a public utility service shall go on strike in breach of contract during the pendency of any conciliation proceedings before a conciliation officer and seven days after the conclusion of such proceedings. In that case there were two unions of workmen. The union having the majority of workmen was called the employees' union while the rival union was called the workers' union. On December 9, 1953, the workers' union presented a charter of demands to the appellant-company. On 20th of January, 1954, the employees' union presented a similar charter of demands. On the same day the workers' union served a notice of strike on the appellant. On 1st February, 1954, a meeting was held before the conciliation officer which was attended by the employees' union and the appellant and a notice of the said meeting had been served on the workers' union. On 2nd February, 1954, the appellant suggested to the conciliation officer that it should discuss the matter separately with the representatives of the two unions. To this suggestion the workers' union took an objection and informed the conciliation officer that it assumed that the conciliation had failed. Consequently on February 3, 1954, the conciliation officer sent his report under Section 12(4) about the failure of the conciliation with the workers' union only. On February 25, 1954 the appellant and the employees' union arrived at a settlement and it was recorded in the form of a memo of settlement which was duly signed by both the parties. Meanwhile, on February 13, 1954, the workers' union commenced a strike. A complaint was filed against some members of the union that they committed subversive acts which were intended or likely to impede, delay or restrict the work of Ramnagar Cane and Sugar Co. Ltd., which was a public utility concern for production of sugar, an essential commodity. Both the Magistrate and the High Court held that the strike was not illegal. It is against this order that the appeal was filed before the Supreme Court. Their Lordships held that if a conciliation proceeding is pending between one union and the employer and it relates to matters concerning all the employees of the employer, the pendency of the said conciliation proceeding would be a bar against all the employees of the employer employed in a public utility service to go on a strike during the pendency of the said proceeding under Section 22(1)(d). This construction, according to them, would be consistent with the specific provisions as to the effect of conciliation settlements prescribed by Section 18(3)(d) and is harmonious with the general policy of the Act; otherwise it would unnecessarily disturb industrial peace, if one non-employed in a public utility service is allowed to go on strike even though the demands common to the members of the said union as well as the rest of the workmen are being considered in conciliation proceedings between the said employer and his other employees represented by another union. It was indicated therein that the position would be different if the conciliation proceedings in question are confined to specific demands limited to a specified class of employees. In such a case the other workmen who are not interested in the said demands may not be bound by the said proceeding. This decision on the construction of Section 22(1)(d) throws no light on the question as to in what circumstances persons not parties to the order of reference should be impleaded as parties.
16. New India Motors (P.) Ltd. v. K.J. Morris 1966-I L.L.J. 551: A.I.R. 1960 S.C. 375, is similarly distinguishable. It was on the construction of Section 33(1)(a). Their Lordships said that the expression 'workmen concerned in such dispute' in Section 33(1)(a) is not limited to the workmen directly or actually concerned in such dispute, but includes all workmen on whose behalf the dispute has been raised as well as those who would be bound by the award which may be made in the said dispute. Section 33(1)(a) runs thus:
33 (1) During the pendency of any conciliation proceeding before a conciliation officer or a Board or of any proceeding before an arbitrator or before a Labour Court or Tribunal or National Tribunal in respect of an industrial dispute, no employer shall,-(a) in regard to any matter connected with the dispute, alter, to the prejudice of the workmen concerned in such dispute, the conditions of service applicable to them immediately before the commencement of such proceedings;.
This decision also throws no light on the question in issue.
17. In paragraph 13 In State of Bihar v. D.N. Ganguly 1958-II L.L.J. 634 : A.I.R. 1958 S.C. 1018, the following observation has been made:
It is true that the Act does not contain any provision specifically authorising the Industrial Tribunal to record a compromise and pass an award in its terms corresponding to the provisions of Order XXIII, Rule 3 of the Code of Civil Procedure. But it would be very unreasonable to assume that the Industrial Tribunal would insist upon dealing with the dispute on the merits even after it is informed that the dispute has been amicably settled between the parties. We have already indicated that amicable settlements of industrial disputes which generally lead to industrial peace and harmony are the primary objects of this Act. Settlements reached before the conciliation officers or Boards are specifically dealt with by Sections 12(2) and 13(3) and the same are made binding under Section 18. There can, therefore, be no doubt that if an industrial dispute before a Tribunal is amicably settled, the Tribunal would immediately agree toache an' award in terms of the settlement between the parties.
18. On the authority of the aforesaid passage it is contended by Mr. Mohanty that the Tribunal was fully justified in passing the award in terms of the settlement. The argument is fallacious. The question in issue in this case is whether the petitioner should have been allowed to be impleaded as a party when it was vitally interested in the determination of the wage structure. After it was impleaded as a party it was open to the Tribunal to examine whether the settlement between opposite parties 2 and 3 was fair and bonafide and was to be accepted despite any objection put forth by the petitioner. State of Bihar v. D. N. Ganguly and Ors. 1958-II L.LJ. 634 : A.I.R. 1958 S.C. 1018, has no application to the facts of this case wherein the petitioner wanted to be made a party to the reference and to be heard.
19. It is not necessary to examine the other authorities cited on either side after the authoritative pronouncement regarding the principles to be followed for impleading parties in Hochtief Gammon v. Industrial Tribunal, Bhubaneshwar 1964-II L.L.J. 460 : A.I.R. 1964 S.C. 1746. We have absolutely no doubt in our mind that the Tribunal failed to exercise its jurisdiction under Section 18(3)(d) of the Act by rejecting the petitioner's prayer.
20. Mr. Mohanty contends that after the award was passed and published the petitioner received benefits under the settlement and the writ application is liable to be dismissed on this ground. Reliance is placed on a single Judge decision of the Bombay High Court in General Engineering Employees' Union and Ors. v. T.R. Bhagwath and Ors 1966-I L.L.J. 568. The facts in that case may be stated in short. For the year 1964-65 the workman in the establishment represented by two trade unions A and B raised demand for profit bonus. The dispute in this regard raised by the trade union A was not taken upfor conciliation by the conciliation officer in the absence of any specific demand. The dispute raised by trade union B was, however, taken up for conciliation. A notice under Rule 18 of the Bombay Industrial Disputes Rules, 1957, was got displayed on the notice-board of the company stating that the dispute for bonus would be taken up for conciliation on a particular date. On the said date certain workmen and representative of the management appeared before the conciliation officer and informed him that negotiations for settlement were going on between the trade union B and the management and he was requested to adjournthe conciliation proceedings to a date to be fixed subsequently. Some of the workmen who were members of trade union A, though present at such meeting, did not inform the conciliation officer that any settlement between the management and the trade union B would not bind them or that their union should be informed of the adjourned date of the conciliation proceedings. Subsequently the management settled the dispute with the trade union B and the settlement was brought before the conciliation officer for his signature. After satisfying himself that the terms of the settlement were fair and reasonable, the conciliation officer recorded the settlement as settlement arrived at in the course of conciliation proceedings under Section 12(3). The trade union A did not appear before the conciliation officer on the date when the settlement was recorded by him. The validity of this settlement was impugned in the writ application. It further appeared that pending the writ application the members of the trade union A accepted the bonus paid by the management under the terms of the settlement and that 99.5 per cent workmen in the establishment bad received the bonus so paid. Such payment was received unconditionally and without stating that they received the bonus without prejudice to the pending writ. Dismissing the writ application his Lordship held that after nearly 99.5 per cent, workmen in the establishment having accepted the said settlement, it would not be proper for the Court to exercise its power under Article 226 of the Constitution to interfere with such settlement which would lead to breach of industrial peace rather than achieve the same. In that case the members of the petitioner-union were aware of the conciliation proceedings but never cared to inform the conciliation officer that any settlement between the management and the trade union would not bind them nor did they request the conciliation officer to inform them about the adjourned date when the conciliation proceedings could be taken up for hearing. This decision is distinguishable as it throws no light on the question in issue.
21. In this case the petitioner wanted to be impleaded as a party to the reference and to challenge the settlement. Without giving any hearing to it the Tribunal passed the award on the basis of the settlement. The petitioner was supplied only with the ordering portion of the award without the reasonings. The petitioner asked the Tribunal to supply a complete copy of the award. Soon after it was obtained the writ application was filed. The Tribunal after having passed an award on the basis of the settlement increasing the basic wage on an ad hoc basis of this nature where the petitioner has to draw its pay on the basis of the award cannot be construed adversely against it. General Engineering Employees' Union and Ors. v. T.R. Bhagwath and Ors 1966-I L.LJ. 568, cannot, therefore, be construed as an authority for the proposition that in all such cases the writ application is not maintainable as benefit has been accepted. In the peculiar facts and circumstances of this case the petitioner had no other alternative but to accept the benefit, the award being effective on its publication.
22. The last contention is whether the petitioner should be allowed to be impleaded as a party to the reference after the award has been published. This contention also has no merit. If the Tribunal passed the award after refusing to exercise the jurisdiction vested in it the award ultimately passed on failure to exercise jurisdiction is liable to be quashed. If this objection is entertained, in no case an award can be questioned when the application for being impleaded as a party is rejected. We accordingly overrule this objection.
23. On our conclusion that the Tribunal failed to exercise the jurisdiction vested in it or illegally exercised its jurisdiction in rejecting the application of the petitioner to be impleaded as a party we quash the award and the order (Annexure C), dated 27-12-1969, by issue of a writ of certiorari. A writ of mandamus be issued directing opposite partyNo. 1 to implead the petitioner as a party and then dispose of the reference in accordance with law. The writ application is allowed; but in the circumstances parties would bear their own costs.
S. Acharya, J.
24. I agree.