Full Judgment Text
1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NOS.5690-5691 OF 2010
CHAUHARYA TRIPATHI & ORS. Appellants
VERSUS
L.I.C.OF INDIA & ORS. Respondents
WITH
CIVIL APPEAL NOS.6547-6549 OF 2010
J U D G M E N T
Dipak Misra, J.
In these appeals, the seminal question that emerges for
consideration is whether the High Court of Allahabad in
Miscellaneous Writ Petition No.21164 of 1998 has justifiably
overturned the award passed by the Central Government Industrial
Tribunal-cum-Labour Court, Kanpur (for short, ‘the Tribunal’) on the
singular foundation that the aggrieved persons, at whose instance a
Signature Not Verified
Digitally signed by
Gulshan Kumar Arora
Date: 2015.04.09
15:27:54 IST
Reason:
reference was made under Sections 10(1) and 2(a) of the Industrial
Disputes Act, 1947 (for brevity, ‘the Act'), was not adjudicable by the
2
tribunal, for the aggrieved persons were working as Development
Officers in the Life Insurance Corporation (LIC) and hence, they could
be treated as workmen under the schematic context of the Act and,
therefore, the Labour Court had no jurisdiction to deal with the lis in
question.
2. Regard being had to the aforesaid issue, we are not required to
state the facts in detail. Suffice it to state that the Central
Government had made a reference, vide notification MO
E-17012/35/89-iB(B) dated 4.12.1989, of the following dispute for
adjudication :
“Whether the action of the management of LIC of
India in imposing penalty of reduction of salary of
Shri R.C. Dubey, C. Tripathi, Nankoo Singh, D.K.
Shukla and N.K. Misra, Development Offices by
three steps in their time scale of pay is justified? If
not, to what relief the workman concerned are
entitled?”
3. Be it noted, such a reference was made as the concerned
development officers were visited with the punishment of reduction of
salary by three steps after conducting an enquiry in a disciplinary
proceeding in respect of certain charges levelled against them and
finding them guilty of the charges. It is apt to note here that the
principal charge that was levelled against the officers was that they
3
had claimed inflated incentive bonus to which they were not entitled
to.
4. Before the tribunal, a plea was advanced by the LIC that the
proceeding before it was not maintainable as the Development
Officers could not be put in the compartment of workmen under the
Act. Apart from the said issue of maintainability, justification was
given as regards the punishment imposed by the LIC. The tribunal
negatived the plea of maintainability and answered the other issues in
favour of the Development Officers and resultantly, it directed
restitution of pay-scale and payment of the arrears that was due to
them.
5. The aforesaid award compelled the LIC to file the writ petition
before the High Court and the High Court, as we find, relying on the
decision in Mukesh K. Tripathi vs. Senior Divisional Manager,
1
LIC & Ors . expressed the view that the development officers were not
workmen and, therefore, the tribunal had no jurisdiction to entertain
the lis and consequently, it unsettled the award passed by the
tribunal. At this juncture, it is seemly to note, after the said decision
was rendered on 18.04.2007, an application for review, being Civil
1
(2004) 8 SCC 387
4
Miscellaneous Review Application No.12736 of 2007, was filed stating,
inter alia, that the order warranted a review in view of the subsequent
pronouncement of this Court in Life Insurance Corporation of
2
India vs. R. Suresh . The High Court declined to entertain the
application for review. Hence, the present appeal by special leave.
6. We have heard Mr. S.P. Singh, learned senior counsel and Mr.
G. Prakash, learned counsel for the appellants and Mr. Kailash
Vasdev, learned senior counsel, assisted by Mr. S. Rajappa, learned
counsel for the respondents.
7. Keeping in view the question posed at the beginning, we are
obligated to make a survey of the authorities that have been
pronounced by this Court specifically pertaining to the Development
Officers working in LIC. A three-Judge Bench of this Court in S.K.
3
Verma vs. Mahesh Chandra & Anr. , adverted to the definition of
'workman' as originally defined under Section 2(s) of the Act and the
substantial amendment that was brought in 1956 in respect of the
definition of 'workman' and referred to the decision in Workmen vs.
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Indian Standards Institution and dwelled upon the hierarchy of
officers working in LIC, the duties performed by such officers and
2 (2008) 11 SCC 319
3 (1983) 4 SCC 214
4
(1975) 2 SCC 847
5
eventually held thus :
“A perusal of the above extracted terms and
conditions of appointment shows that a
development officer is to be a whole time employee
of the Life Insurance Corporation of India. that his
operations are to be restricted to a defined area and
that he is liable to be transferred. He has no
authority whatsoever to bind the Corporation in
anyway. His principal duty appears to be to
organise and develop the business of the
Corporation in the area allotted to him and for that
purpose to recruit active and reliable agents, to
train them to canvass new business and to render
post-sale services to policy-holders. He is expected
to assist and inspire the agents. Even so he has not
the authority to appoint agents or to take
disciplinary action against them. He does not even
supervise the work of the agents though he is
required to train them and assist them. He is to be
the 'friend, philosopher and guide' of the agents
working within his jurisdiction and no more. He is
expected to stimulate and excite the agents to
work, while exercising no administrative control
over them. The agents are not his subordinates. In
fact, it is admitted that he has no subordinate staff
working under him. It is thus clear that the
development officer cannot by any stretch of
imagination be said to be engaged in any
administrative or managerial work. He is a
workman within the meaning of s.2(s) of the
Industrial, Disputes Act.”
8. It is submitted by Mr. Kailash Vasdev, learned senior counsel,
that the said decision was considered by the Constitution Bench in
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H.R. Adhyanthya & Ors. vs. Sandoz (India) Ltd. & Ors. , as the
larger Bench was addressing the controversy, whether the medical
5
(1995) 5 SCC 737
6
representatives as they are commonly known would be workmen
according to the definition of workman under Section 2(s) of the Act.
The larger Bench analyzing the purport of the said dictionary clause
and various other aspects wherein the meaning has been attributed
and ascribed to workmen and further taking note of the authorities in
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May & Baker (India) Ltd. vs. Workmen ; Western India Match Co.
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Ltd. vs. Workmen ; and Burmah Shell Oil Storage and
Distribution Co. of India Ltd. vs. Burmah Shell Management
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Staff Association and analysing the scheme of the Act ruled thus :
“13. In S.K. Verma v. Mahesh Chandra, the was
whether Development Officers of the Life Insurance
Corporation of India (LIC) were workmen. The
dispute arose on account of the dismissal of the
appellant Development Officer w.e.f. 8-2-1969. The
Court noticed that the change in the definition of
workman brought about by the Amending Act 36 of
1956 which, as stated above, added to the
originally enacted definition, two more categories of
employees, viz., those doing 'supervisory' and
'technical' work. The three-Judge Bench of this
Court did not refer to the earlier decisions in May &
Baker1, WIMCO and Burmah Shell cases. The
Bench only referred to the decision of this Court in
Workmen v. Indian Standards Institution5 where
while considering whether ISI was an 'industry' or
not, it was held that since the ID Act was a
legislation intended to bring about peace and
harmony between management and labour in an
'industry', the test must be so applied as to give the
6
AIR 1967 SC 678
7 AIR 1964 SC 472
8
(1970) 3 SCC 378
7
widest possible connotation to the term 'industry'
and, therefore, a broad and liberal and not a rigid
and doctrinaire approach should be adopted to
determine whether a particular concern was an
industry or not. The Court, therefore, held that to
decide the question whether the Development
Officers in the LIC were workmen or not, it should
adopt a pragmatic and not a pedantic approach
and consider the broad question as to on which
side of the line the workman fell, viz., labour or
management, and then to consider whether there
were any good reasons for moving them over from
one side to the other. The Court then noticed that
the LIC Staff Regulations classified the staff into
four categories, viz., (i) Officers, (ii) Development
Officers, (iii) Supervisors and Clerical Staff, and (iv)
Subordinate Staff. The Court pointed out that
Development Officers were classified separately
both from Officers on the one hand and
Supervisors and Clerical Staff on the other and
that they as well as Class III and Class IV staff
other than Superintendents were placed on par
inasmuch as their appointing and disciplinary
authority was the Divisional Manager whereas that
of Officers was Zonal Manager. The Court also
referred to their scales of pay and pointed out that
the appellation 'Development Officer' was no more
than a glorified designation. The Court then
referred to the nature of duties of the Development
Officers and pointed out that a Development Officer
was to be a whole-time employee and that his
operations were to be restricted to a defined area
and that he was liable to be transferred. He had no
authority whatsoever to bind the Corporation in
any way. His principal duty appeared to be to
organise and develop the business of the
Corporation in the area allotted to him, and for
that purpose, to recruit active and reliable agents,
to train them, to canvass new business and to
render post- sale services to policyholders. He was
expected to assist and inspire the agents. Even so,
he had not the authority either to appoint them or
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to take disciplinary action against them. He did not
even supervise the work of the agents though he
was required to train them and assist them. He
was to be a friend, philosopher and guide of the
agents working within his jurisdiction and no
more. He was expected to "stimulate and excite" the
agents to work while exercising no administrative
control over them. The agents were not his
subordinates. He had no subordinate staff working
under him. The Court, therefore, held that it was
clear that the Development Officer could not by any
stretch of imagination be said to be engaged in any
administrative or managerial work and, therefore,
he was a workman within the meaning of the ID
Act. Accordingly, the order of the Industrial
Tribunal and the judgment of the High Court
holding that he was not a workman were set aside.
As has been pointed out above, this decision did
not refer to the earlier three decisions in May &
Bakerl, WIMCO2 and Burmah Shell3 cases. and
obviously proceeded on the basis that if an
employee did not come within the four exceptions
to the definition, he should be held to be a
workman. This basis was in terms considered and
rejected in Buramah Shell case3 by a Coordinate
Bench of three Judges. Further no finding is given
by the Court whether the Development Officer was
doing clerical or technical work. He was admittedly
not doing manual work. We may have, therefore, to
treat this decision as per incuriam.”
9. We have quoted in extenso as the Constitution Bench has
declared the pronouncement in S.K. Verma's case as per incuriam .
At this juncture, it is condign to note the position in Mukesh K.
Tripathi (supra) which has been rendered by the three-Judge Bench
that has been placed reliance upon by the High Court while deciding
the writ petition. In Mukesh K. Tripathi's case, the question arose
9
whether the appellant, who was appointed as Apprentice
Development Officer, could be treated as a workman. While dealing
with the said question, the three-Judge Bench referred to earlier
decisions and the Constitution Bench decision in H.R. Adhyanthya
(supra) and opined that:-
“21. Once the ratio of May and Baker (supra) and
other decisions following the same had been
reiterated despite observations made to the effect
that S.K. Verma (supra) and other decisions
following the same were rendered on the facts of
that case, we are of the opinion that this Court had
approved the reasonings of May and Baker (supra)
and subsequent decisions in preference to S.K.
Verma (supra).
22. The Constitution Bench further took notice of
the subsequent amendment in the definition of
'workman' and held that even the Legislature
impliedly did not accept the said interpretation of
this Court in S.K. Verma (supra) and other
decisions.
23. It may be true, as has been submitted by Ms.
Jaisingh, that S.K. Verma (supra) has not been
expressly overruled in H.R. Adyanthaya (supra)
but once the said decision has been held to have
been rendered per incuriam, it cannot be said to
have laid down a good law. This Court is bound by
the decision of the Constitution Bench.”
10. We respectfully agree with the aforesaid exposition of law. There
can be no cavil over the proposition that once a judgment has been
declared per incuriam, it does not have the precedential value.
11. After so stating, the three-Judge Bench did not accept the stand
10
of the appellant therein that he was a workman and accordingly
declined to interfere.
12. As has been stated earlier, the decision that was pressed into
service in the application filed for review is the judgment in R. Suresh .
In the said case, the question that was posed in the beginning of the
judgment reads thus:
“2. Whether jurisdiction of the Industrial Courts
are ousted in regard to an order of dismissal
passed by Life Insurance Corporation of India, a
corporation constituted and incorporated under the
Life Insurance Corporation Act, 1956, is the
question involved in this appeal which arises out of
a judgment and order dated 3.2.2006 passed by a
Division Bench of the Kerala High Court at
Ernakulam.”
The facts that were the subject matter of the lis in the said case
were that the respondent was appointed as a Development Officer of
the LIC and a departmental proceeding was initiated against him and
eventually he was found guilty in respect of certain charges and was
dismissed from service by the disciplinary authority. As an industrial
dispute was raised by him, the appropriate Government referred the
dispute for adjudication by the industrial tribunal. The tribunal
passed an award on 06.02.1993 and reduced the punishment
imposed by the employer. The said order was assailed before the
High Court in the writ petition. Before the High Court, the decision in
11
9
M. Venugopal vs. LIC of India was cited. The High Court opined
that the said decision was not applicable and placed reliance on the
authority in S.K. Verma (supra). Thereafter the Court referred to the
jurisdiction of the industrial tribunal in interfering with the quantum
of punishment and after referring to various provisions of the Life
Insurance Corporation Act, 1956, opined that it is a State and on that
basis ruled, thus :
“35. The jurisdiction of the Industrial Court being
wide and it having been conferred with the power
to interfere with the quantum of punishment, it
could go into the nature of charges, so as to arrive
at a conclusion as to whether the respondent had
misused his position or his acts are in breach of
trust conferred upon him by his employer.
36. It may be true that quantum of loss may not
be of much relevance as has been held in Suresh
Pathrella Vs. Oriental Bank of Commerce [(2006)
10 SCC 572], but there again a question arose as
to whether he was in the position of a trust or not.”
13. At this juncture, we are obliged to state that the two-Judge
Bench referred to the decision in S.K. Verma (supra) and also stated
that they were not unmindful of the principle stated in Mukesh K.
Tripathi (supra). Dealing with the decision in Mukesh K. Tripathi
(supra), the Court said that there the question was whether the
Apprentice Development Officer would be a 'workman' within the
meaning of the provisions of Section 2(s) of the Act and observed that
9
(1994) 2 SCC 323
12
it was not dealing with the case that pertains to an apprentice.
14. Mr. Singh, learned senior counsel appearing for the appellant
built the plinth of his argument on the basis of the aforesaid authority
with the hope that an enormous structure would come into existence
but as we find on a studied and anxious reading of the judgment, we
notice that there is no reference to the Constitution Bench decision in
H.R. Adhyanthya (supra) and the two-Judge Bench, though has
referred to S.K. Verma and Mukesh K. Tripathi (supra) but has not
taken note of what the three-Judge Bench has said in Mukesh K.
Tripathi (supra) with regard to the precedent and how S.K. Verma's
case is no more a binding precedent.
15. In our considered opinion, the decision in R. Suresh (supra)
cannot be regarded as the precedent for the proposition that a
Development Officer in LIC is a 'workman'. In fact, the judgment does
not say so but Mr. Vasdev, learned senior counsel would submit that
inferring such a ratio, cases are being decided by the High Courts and
other authorities. Though such an apprehension should not be there,
yet to clarify the position, we may quote few lines from Ambica
10
Quarry Works etc. v. State of Gujarat :
“It has been said long time ago that a case is only
an authority for what it actually decides, and not
10 AIR 1987 SC 1073
13
what logically follows from it. (See Lord Halsbury in
Quinn v. Leathem, 1901 AC 495).”
In view of the aforesaid, any kind of interference is not
permissible but, a pregnant one, it has dealt with the cases of
Development Officers of LIC.
16. As we find, the said judgment has been rendered in ignorance of
the ratio laid down by the Constitution Bench in H.R. Adhyanthya
(supra) and also the principle stated by the three-Judge Bench in
Mukesh K. Tripathi (supra) that the decision in S.K. Verma (supra)
is not a precedent, and hence, we are compelled to hold that the
pronouncement in R. Suresh (supra) is per incuriam . We say so on
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the basis of the decisions rendered in A.R. Antulay v. R.S. Nayak ,
Punjab Land Development & Reclamation Corpn. Ltd. v. Labour
12 13
Court , State of U.P. v. Synthetics and Chemicals Ltd. and
14
Siddharam Satlingappa Mhetre v. state of Maharashtra .
17. In view of the aforesaid analysis, we conclude and hold that the
development officers working in the LIC are not 'workmen' under
Section 2(s) of the Act and accordingly we do not find any flaw in the
judgment rendered by the High Court.
11 (1988) 2 SCC 602
12 (1990) 3 SCC 682
13 (1991) 4 SCC 139
14 (2011) 1 SCC 694
14
16. Ex consequenti , the appeals, being sans merit, stand dismissed.
However, in the facts and circumstances of the case, there shall be no
order as to costs.
.............................J.
(Dipak Misra)
.............................J.
(Prafulla C. Pant)
New Delhi;
March 11, 2015.
ITEM NO.102 COURT NO.5 SECTION XI
S U P R E M E C O U R T O F I N D I A
RECORD OF PROCEEDINGS
Civil Appeal Nos.5690-5691/2010
CHAUHARYA TRIPATHI & ORS. Appellant(s)
VERSUS
L.I.C.OF INDIA & ORS. Respondent(s)
(With office report)
WITH
C.A. Nos.6547-6549/2010
Date : 11/03/2015 These appeals were called on for hearing today.
CORAM : HON'BLE MR. JUSTICE DIPAK MISRA
HON'BLE MR. JUSTICE PRAFULLA C. PANT
For Appellant(s) Mr. S.P. Singh, Sr. Adv.
Mr. Keshav Choudhary, Adv.
Mr. Vimal Chandra S. Dave, AOR
Mr. G. Prakash, AOR
Ms. Beena Prakash, Adv.
Ms. Priyanka Prakash, Adv.
For Respondent(s) Mr. Kailash Vasdev, Sr. Adv.
Mr. Shreyans Singhvi, Adv.
Mr. Umrao Singh R., Adv.
Mr. S. Rajappa, AOR
UPON hearing the counsel the Court made the following
O R D E R
The appeals are dismissed in terms of the signed
reportable judgment.
(Gulshan Kumar Arora) (H.S. Parasher)
Court Master Court Master
(Signed reportable judgment is placed on the file)