Full Judgment Text
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CASE NO.:
Appeal (civil) 2175 of 2007
PETITIONER:
Dharappa Sangappa Nandyal
RESPONDENT:
Bijapur Co-operative Milk Producers Societies Union Ltd
DATE OF JUDGMENT: 26/04/2007
BENCH:
G P Mathur & R V Raveendran
JUDGMENT:
J U D G M E N T
CIVIL APPEAL NO 2175 OF 2007
(Arising out of SLP [C] No.3796/2006)
RAVEENDRAN, J.
Leave granted.
This appeal is filed against the judgment dated 15.6.2005 passed by
the High Court of Karnataka in Writ Appeal No.2131/2005.
2. The appellant claims that he was employed as a daily-wage labourer
in the Rural Dairy Centre, Bijapur, on 13.5.1977. He further alleges that he
worked continuously and uninterruptedly till his services were illegally
terminated with effect from 1.3.1980. The appellant did not challenge his
termination.
3. Section 10 of the Industrial Disputes Act, 1947 ( ’ID Act’ for short)
was amended in Karnataka by the Industrial Disputes (Karnataka
Amendment) Act, 1987 [Karnataka Act No.5 of 1988] inserting the
following as sub-section (4A) with effect from 7.4.1988 :
"(4A) Notwithstanding anything contained in section 9-C and in this
section, in the case of a dispute falling within the scope of section 2-A, the
individual workman concerned may, within six months from the date of
communication to him of the order of discharge, dismissal, retrenchment
or termination or the date of commencement of the Industrial Disputes
(Karnataka Amendment) Act, 1987, whichever is later, apply, in the
prescribed manner, to the Labour Court for adjudication of the dispute and
the Labour Court shall dispose of such application in the same manner as a
dispute referred under sub-section (1)."
Taking advantage of the new provision, on 4.10.1988, the appellant made an
application to the Labour Court, Hubli (KID No.1055/88 subsequently
transferred and renumbered as KID No. 497/1995 on the file of the Labour
Court, Bijapur) seeking a declaration that his termination from service on
1.3.1980 was null and void and a direction for reinstatement with full back-
wages, continuity of service and other consequential reliefs. The appellant
contended that his termination amounted to illegal retrenchment, as the
respondent failed to comply with the mandatory requirements of Section 25-
F of ID Act even though he had worked continuously for more than 240
days in a year.
4. The respondent (Karnataka Milk Federation, Unit : Bijapur) filed an
objection statement contending that it came into existence and took over the
Rural Dairy Centre, Bijapur, long after the alleged termination of appellant
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by Rural Dairy Centre, Bijapur. The respondent denied the claim of the
appellant that he was a daily wage worker between 13.5.1977 and 1.3.1980
and that his services were termination in violation of section 25F of the ID
Act.
5. The appellant gave evidence and produced a certificate dated
19.2.1978 allegedly issued by the Dairy Supervisor, Rural Dairy Centre,
Bijapur, certifying that he had worked as a casual labourer from 13.5.1977 to
19.2.1978. None was examined on behalf of the respondent to deny the said
certificate. On consideration of the material, the Labour Court accepted the
said service certificate, but did not accept his further self-serving statement
that he worked up to 1.3.1980 as such claim was not supported by any
document. The Labour Court made an award dated 15.10.1996 directing
reinstatement, holding that Appellant had worked for more than 240 days in
the year preceding termination (13.5.1977 to 19.2.1978), and the termination
of his service, without complying with section 25F of ID Act, amounted to
illegal retrenchment. However, as there was an inordinate delay of 10 years
in filing the claim statement, the Labour Court awarded only 50% back-
wages in addition to continuity of service and consequential benefits. The
respondent challenged the said award in W.P. No.7227/1997.
6. During the pendency of the said writ petition, a Division Bench of
Karnataka High Court held in Veerashiva Co-operative Bank Ltd. vs.
Presiding Officer, Labour Court [2001 (3) Kar.L.J. 519] that the procedure
for adjudication and the remedy provided under the Karnataka Co-operative
Societies Act, 1959 (’KCS Act’ for short) being comprehensive, the
jurisdiction of Labour Courts under ID Act to deal with such disputes was
barred. The decision in Veerashiva Co-operative Bank was approved and
reiterated by a Full Bench of the Karnataka High Court in Karnataka Sugar
Workers Federation v. State of Karnataka [2003 (4) Kar.L.J. 353].
7. Following the decision of the Full Bench, a Single Judge of the High
Court, allowed the Respondent-employer’s writ petition, by order dated
1.2.2005, holding that ID Act was inapplicable to a dispute raised by an
employee of a co-operative society. He therefore set aside the award of the
Labour Court, reserving liberty to the appellant to work out his remedy in
accordance with law. The said order of the learned Single Judge was
challenged by the appellant in a writ appeal. A Division Bench of the High
Court, by its judgment dated 15.6.2005, dismissed the writ appeal, holding
that an employee of a co-operative society having a claim against the
employer has to raise a dispute under Section 70 of the KCS Act. The
Division Bench purported to follow the decision of the Full Bench in
Karnataka Sugar Workers Federation. The said decision of the Division
Bench is challenged in this appeal by special leave.
8. The Appellant contends that amended Section 70 of the KCS Act took
away the jurisdiction of Labour Courts and Industrial Tribunals functioning
under the ID Act, only when the amendments to the said section as per Act 2
of 2000 came into effect on 20.6.2000, and it did not nullify an award made
by the Labour Court prior to that date, that is on 15.10.1996. It was also
contended that the respondent not having raised any objection about want of
jurisdiction before the Labour Court, could not subsequently be permitted to
raise the plea of want of jurisdiction before the High Court. The Respondent
on the other hand, supported the decision of the High Court and contended
that the Labour Court had no jurisdiction having regard to section 70 of the
KCS Act. The respondent also contended that the award of the Labour Court
was otherwise also unsustainable as the claim itself was hopelessly barred by
limitation, delay and laches. Therefore, the following two questions arise for
our consideration :
(i) Whether the jurisdiction of Labour Court under the ID Act, was
barred by section 70 of the KCS Act with reference to co-
operative societies and if so, from when.
(ii) Even if Labour Court had jurisdiction, whether the appellant
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was entitled to file an application under Section 10(4A) of ID
Act in respect of a cause of action which occurred in 1978.
Re : Question (i) :
9. It is necessary to refer to the metamorphosis of section 70 of the KCS
Act, before considering this question. The said section originally stood as
follows :
"70. Disputes which may be referred to Registrar for decision. \026 (1)
Notwithstanding anything contained in any law for the time being in force,
if any dispute touching the constitution, management, or the business of a
co-operative society arises. \026
(a) and (b) x x x x x (omitted as not relevant)
[c] between the society or its committee and any past committee,
any officer, agent or employee, or any past officer, past agent or
past employee or the nominee, heirs, or legal representatives of any
deceased officer, deceased agent, or deceased employee of the
society, or
(d) x x x (omitted as not relevant)
such dispute shall be referred to the Registrar for decision and no Court
shall have jurisdiction to entertain any suit or other proceeding in respect
of such dispute.
(2) For the purposes of sub-section (1), the following shall be deemed
to be disputes touching the constitution, management or the business of a
co-operative society, namely. \026
(a) a claim by the society for any debt or demand due to it
from a member or the nominee, heirs or legal representatives of a
deceased member, whether such debt or demand be admitted or
not;
(b) a claim a surety against the principal debtor where the
society has recovered from the surety any amount in respect of any
debt or demand due to it from the principle debtor, as a result of
the default of the principal debtor whether such debt or demand is
admitted or not;
(c) any dispute arising in connection with the election of a
President, Vice-President, Chairman, Vice-Chairman, Secretary,
Treasurer or Member of Committee of the society.
(3) x x x (omitted as not relevant).
Section 70 was amended by Karnataka Co-operative Societies (Amendment)
Act, 1976 (Karnataka Act 19 of 1976). The Amendment Act received the
assent of the Governor on 7.3.1976. It was brought into effect from
20.1.1976. The Amendment Act added the following as clauses (d) and (e)
in sub-section (2) of section 70 :
(d) any dispute between a co-operative society and its
employees or past employees or heirs or legal representatives of a
deceased employee, including a dispute regarding the terms of
employment, working conditions and disciplinary action taken by a
co-operative society;
(e) a claim by a co-operative society for any deficiency caused
in the assets of the co-operative society by a member, past
member, deceased member or deceased officer, past agent or
deceased agent or by any servant, past servant or deceased servant
or by its committee, past or present whether such loss be admitted
or not."
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Section 70 was again amended by Karnataka Co-operative Societies (Second
Amendment) Act, 1997 (Karnataka Act No.2/2000) in the following manner:
(i) In sub-section (1), for the words "no court", the words "no
civil or Labour or Revenue court or Industrial Tribunal" were
substituted.
(ii) At the end of clause (d) of sub-section (2), the words
"notwithstanding anything contrary contained in the Industrial
Disputes Act, 1947 (Central Act 14 of 1947)" were inserted.
The said Amendment Act (Act 2 of 2000) received the assent of the
President on 18.3.2000 and was brought into force on 20.6.2000. After the
said amendments in 1996 and 2000, Section 70 of KCS Act (relevant
portion) reads thus:
"Notwithstanding anything contained in any law for the time being in
force, if any dispute touching the constitution, management, or the
business of a Co-operative Society arises - \005 between the Society or its
committee and \005 any officer, agent or employee, or any past officer, past
agent or past employee \005 of the Society, _.. such dispute shall be referred
to the Registrar for decision and no Civil or Labour or Revenue Court or
Industrial Tribunal shall have jurisdiction to entertain any suit or other
proceeding in respect of such dispute.
For the purposes of sub-section (1), the following shall be deemed to be
disputes touching the constitution, management or the business of a Co-
operative Society, namely \005\005. (d) any dispute between a Co-operative
Society and its employees or past employees or heirs or legal
representatives of a deceased employee, including a dispute regarding the
terms of employment, working conditions, and disciplinary action taken
by a Co-operative Society notwithstanding anything contrary contained in
the Industrial Disputes Act, 1947(Central Act 14 of 1947)."
10. "Co-operative societies" fall under Entry 32 of the State List.
"Industrial and labour disputes" fall under Entry 22 of the Concurrent List.
Industrial Disputes Act, 1947 is an "existing law" with respect to a matter
enumerated in the Concurrent List, namely, industrial and labour disputes. A
dispute between a co-operative society and its employees in regard to terms
of employment, working conditions and disciplinary action, is an industrial
and labour dispute squarely covered by an existing law (ID Act), if the
employees are ’workmen’ as defined in the ID Act. Clause (1) of Article 254
provides that if any provision of a law made by a State Legislature is
repugnant to any provision of an existing law with respect to one of the
matters enumerated in the Concurrent List, then, subject to the provisions of
clause (2), the existing law shall prevail, and the law made by the
Legislature of the State shall, to the extent of the repugnancy, be void.
Clause (2) of Article 254, however, provides that where a law made by the
Legislature of a State with respect to one of the matters enumerated in the
Concurrent List, contains any provision repugnant to an existing law with
respect to that matter, then, the law so made by the Legislature of such State
shall, if it has been reserved for the consideration of the President and has
received his assent, prevail in that State. The question of repugnancy can
arise only with reference to a legislation made by Parliament falling under
the Concurrent List or an existing law with reference to one of the matters
enumerated in the Concurrent List. If a law made by the State Legislature
covered by an Entry in the State List incidentally touches any of the entries
in the Concurrent List, Article 254 is not attracted. But where a law covered
by an entry in the State List (or an amendment to a law covered by an entry
in the State List) made by the State Legislature contains a provision, which
directly and substantially relates to a matter enumerated in the Concurrent
List and is repugnant to any provision of an existing law with respect to that
matter in the Concurrent List then such repugnant provision of the State law
will be void. Such a provision of law made by the State Legislature touching
upon a matter covered by the Concurrent List, will not be void if it can co-
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exist and operate without repugnancy with the provisions of the existing law.
What is stated above with reference to an existing law, is also the position
with reference to a law made by the Parliament. Repugnancy is said to arise
when : (i) there is clear and direct inconsistency between the Central and the
State Act; (ii) such inconsistency is irreconciliable, or brings the State Act
in direct collision with the Central Act or brings about a situation where
obeying one would lead to disobeying the other. If the State Legislature,
while making or amending a law relating to co-operative societies, makes a
provision relating to labour disputes falling under the Concurrent List, then
Article 254 will be attracted if there is any repugnancy between such
provision of the State Act (MCS Act) with the existing law (ID Act). We
will have to examine the issue in this case keeping the above legal position
in mind.
11. The effect of the amendments to Section 70 of KCS Act, by Act 2 of
2000 is that if any dispute (including any dispute relating to the terms of
employment, working conditions and disciplinary action), arose between a
co-operative society and its employees or past employees or heirs/legal
representatives of a deceased employee, on and from 20.6.2000, such
dispute had to be referred to the Registrar for decision and no Civil Court or
Labour Court or Industrial Tribunal would have jurisdiction to entertain any
suit or proceeding in respect of such dispute.
12. Even prior to 20.6.2000, having regard to the amendment to Section
70 of KCS Act by Act 19 of 1976 with effect from 20.1.1976, any dispute
between a co-operative society and its employees or past employees or
heirs/legal representatives of a deceased employee including a dispute
regarding the terms of employment, working conditions and disciplinary
action taken by a co-operative society, was deemed to be a dispute touching
the constitution, management, or business of a co-operative society which
had to be referred to the Registrar for adjudication. But prior to 20.6.2000,
there was no express exclusion of the jurisdiction of the Labour Court and
Industrial Tribunal. As a result, if an employee of a Co-operative Society
answered the definition of ’workman’ and the dispute between the co-
operative society and its employee fell within the definition of an ’industrial
dispute’, then the employee had the choice of two alternative forums \026 either
to raise a dispute before the Registrar under Section 70 of the KCS Act or
seek a reference to the Labour Court/Industrial Tribunal under Section
10(1)(c) of the ID Act (or approach the Labour Court by an application
under Section 10(4A) of ID Act).
13. In Co-operative Central Bank Ltd. v. Additional Industrial Tribunal,
A.P. (AIR 1970 SC 245), this Court considered Section 61 of the Andhra
Pradesh Co-operative Societies Act, 1964, which dealt with disputes which
could be referred to the Registrar. The said section was in pari materia with
Section 70 of KCS Act, as it originally stood, before the amendments under
Act 19 of 1976 and Act 2 of 2000. This Court held that where a State Co-
operative Societies Act had received the assent of the President, if any
provision of such State Act was repugnant to any provision of the ID Act,
the provisions of the State Act will prevail over the provisions of the ID Act.
This Court accepted the general proposition that the jurisdiction of the
Industrial Tribunal/Labour Court under the Industrial Disputes Act will be
barred if the disputes can be competently decided by the Registrar under
section 61 of the Andhra Pradesh Act, in view of the fact that the Andhra
Pradesh Act had received the assent of the President. This Court then
proceeded to examine whether disputes relating to service conditions of
workmen could be referred to the Registrar for decision under Section 61 of
the State Act and held that the disputes could only be decided by an
Industrial Tribunal dealing with an industrial dispute. This Court held that
the Registrar under the Co-operative Societies Act, could not grant the relief
in respect of such disputes because of the limitations placed on his powers
under the Act itself, and having regard to the expression "touching the
business of the society" in Section 61 which did not include a dispute in
regard to conditions of service of workmen.
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14. Though the Karnataka Co-operative Societies Act, 1959 was reserved
for the assent of the President and received his assent on 11.8.1959, the
Amendment Act 19 of 1976 which added clause (d) to sub-section (2) of
Section 70, (whereby a dispute between a Co-operative Society and its
present or past employee/s in regard to any disciplinary action or working
conditions was deemed to be a dispute touching the constitution,
management, or the business of a co-operative society), was neither reserved
for, nor received the assent of the President. In the absence of the assent of
the President, clause (d) of Section 70(2) could not be called in aid to
contend that section 70(1)(c) of the KCS Act would prevail over the
provisions of the Industrial Disputes Act. Consequently, even after the 1976
amendment to the KCS Act, the Labour Courts and Industrial Tribunals
functioning under the ID Act continued to have jurisdiction in regard to
disputes between a Society and its workmen if the co-operative society
answered the definition of an ’industry’ and the dispute was an ’industrial
dispute’. But when sub-section (1) of section 70 of KCS Act was further
amended by Act 2 of 2000 by specifically excluding the jurisdiction of
Labour Courts and Industrial Tribunals with the simultaneous addition of the
words "notwithstanding anything contrary contained in the Industrial
Disputes Act, 1947" in clause (d) of Section 70(2) of KCS Act, the said
Amendment Act (Act 2 of 2000) was reserved for the assent of the President
and received such assent on 18.3.2000. The amended provisions were given
effect from 20.6.2000. Therefore, only with effect from 20.6.2000, the
jurisdiction of Labour Courts and Industrial Tribunals were excluded in
regard to disputes between a co-operative Society and its employees (or past
employees) relating to terms of employment, service conditions or
disciplinary action. It follows therefore that in the year 1996, the Labour
Court had the jurisdiction to make an award in regard to such a dispute. The
High Court could not have interfered with it on the ground that Section 70 of
the KCS Act was a bar to the jurisdiction of the Labour Court to decide the
dispute.
15. The 1976 Amendment to the KCS Act did not bring about any
inconsistency with the provisions of the ID Act nor did it purport to prevail
over the provisions of the ID Act. Its effect was merely to provide an
additional or alternative forum for adjudication of the disputes between co-
operative societies and its employees, relating to employment, working
conditions and disciplinary action. The 1976 Amendment Act, therefore,
was valid, even in the absence of the assent of the President. On the other
hand, the 2000 Amendment specifically excluded the jurisdiction of
Industrial Tribunals and Labour Courts under the ID Act, and intended to
prevail over the provisions of the ID Act in regard to adjudication of
disputes. The said Amendment required the assent of the President and was,
in fact, reserved for the assent of the President and obtained his assent. If the
1976 Amendment was to be read as excluding the jurisdiction of the
Industrial Tribunals and Labour Courts, then it was necessary to read the
provisions of Section 70, as amended by the 1976 Act, as prevailing over the
provisions of the ID Act. In which event, it would have required the
President’s assent, and in the absence of such assent, the Amendment to the
extent it purported to prevail over the Central enactment, would have been
void. Therefore, the only way to read the 1976 Amendment is to read it in a
literal and normal manner, that is, as not excluding the jurisdiction of the
Industrial Tribunals and Labour Courts but as merely conferring a
concurrent jurisdiction on the Registrar under Section 70 of the KCS Act.
16. This aspect has been completely overlooked by the Division Bench of
the Karnataka High Court in Veerashaiva Co-operative Bank. It misled itself
to an erroneous assumption that two decisions of this Court in R.C. Tiwari v.
Madhya Pradesh State Co-operative Marketing Federation Ltd. (1997 (5)
SCC 125) and Sagarmal v. District Sahkari Kendriya Bank Ltd., Mandsaur
and another [1997 (9) SCC 354] laid down the proposition that once a
specific procedure and effective remedy is provided under a Co-operative
Societies Act, it ipso facto excluded the settlement of disputes under section
10 of the Industrial Disputes Act. On that assumption, the High Court held
that Section 70 of the KCS Act, excluded the jurisdiction of Labour Courts/
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Industrial Tribunals in regard to references under Section 10 of the ID Act
stood excluded. The High Court held so in view of clause (d) of sub-section
(2) of Section 70 which provided that any dispute between a co-operative
society and its employees (past or present) in regard to terms of
employment, working conditions and disciplinary action will be deemed to
be a dispute to be decided by the Registrar under sub-section (1) of Section
70, overlooking the fact that Amendment Act 19 of 1976 by which clause
(d) was inserted in Section 70(2), had not received the assent of the
President and therefore the jurisdiction of the Registrar under Section 70(1)
of the KCS Act as expanded by section 70(2)(d), could not prevail over the
provisions of the ID Act. If the amendment to section 70(2) by Act 19 of
1976 should be read or construed as having the effect of enabling section
70(1) of KCS Act to prevail over the provisions of ID Act, then the said
amendment Act (Act 19 of 1976) would have required the assent of the
President under Article 254(2). But there was no such assent.
17. As the Division Bench had relied on two decisions of this Court in
R.C. Tiwari (supra) and Sagarmal (supra), it is necessary to refer to them.
But before doing so, we have to note that many a time, a principle laid down
by this Court with reference to the provisions of a particular State Act is
mechanically followed to interpret cognate enactments of other States,
without first ascertaining whether the provisions of the two enactments are
identical or similar. This frequently happens with reference to the laws
relating to rent and accommodation control, co-operative societies and land
revenue. Before applying the principles enunciated with reference to another
enactment, care should be taken to find out whether the provisions of the Act
to which such principles are sought to be applied, are similar to the
provisions of the Act with reference to which the principles were evolved.
Failure to do so has led to a wrong interpretation of section 70 of the KCS
Act, in Veerashiva Co-operative Bank and Karnataka Sugar Workers
Federation.
18. R.C. Tiwari (supra) related to Madhya Pradesh, where ID Act itself
was inapplicable (except to the extent indicated in M.P. Industrial Relations
Act, 1960). In that case, an employee of a co-operative society who had
been dismissed from service for mis-conduct, raised a dispute under the
Madhya Pradesh Co-operative Societies Act, 1960. The concerned Deputy
Registrar held that the dismissal was proper and rejected the reference.
Thereafter the employee sought a reference under section 10(1) of the ID
Act. The Labour Court held that the domestic inquiry was vitiated and set
aside the order of dismissal. The said order was challenged by the employer-
Society before the Madhya Pradesh High Court. The High Court held that in
view of the provisions of Section 55 of the Madhya Pradesh Co-operative
Societies Act, 1960, the Labour Court had no jurisdiction and therefore the
reference to the Labour Court was bad. It also held that the findings recorded
by the Deputy Registrar, Co-operative Societies against the employee in the
award made under Section 55 of the Madhya Pradesh Co-operative Societies
Act, would operate as res judicata. This Court upheld the said decision of the
High Court and dismissed the special leave petition. The decision was
rendered with reference the special provisions of the M.P. Co-operative
Societies Act, 1960 and the M.P. Industrial Relations Act, 1960. Having
regard to Section 110 of the M.P. Industrial Relations Act, the provisions of
the Central Act - Industrial Disputes Act, 1947 (except Chapters V-A, V-B
and V-C relating to lay off and retrenchment, special provisions relating to
lay off, retrenchment and closure in certain establishments and unfair labour
practices), did not apply to any industry to which the said M.P. Industrial
Relations Act applied. ID Act did not apply in the State of Madhya Pradesh
for adjudication of disputes between the employer and employees, not
because of any bar in the MP Co-operative Societies Act, but because of the
State having made a law relating to industrial disputes, namely the M.P.
Industrial Relations Act, 1960 which had received the assent of the
President. The M.P. Co-operative Societies Act, 1960, vide section 55,
specifically provided that where a dispute including a dispute relating to
terms of employment, working conditions and disciplinary action by a
Society arises between a Society and its employees, the Registrar or any
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officer appointed by him shall decide the dispute and his decision shall be
binding on the Society and its employees; and Section 93 of the M.P. Co-
operative Societies Act provided that nothing contained in the M.P.
Industrial Relations Act, 1960 shall apply to a Society registered under that
Act (M.P. Co-operative Societies Act). It is in those circumstances that in
R.C. Tiwari, this Court held that the I.D. Act did not apply to a dispute
between a Society and its employees in regard to any disciplinary action. In
that case, the question of any repugnancy between a State Act (Madhya
Pradesh State Co-operative Societies Act) and the Central Act (the Industrial
Disputes Act, 1947) did not arise. The State of Karnataka does not have a
State Act governing industrial disputes as in Madhya Pradesh and therefore,
the question of Karnataka Co-operative Societies Act excluding the
applicability of a State law relating to industrial disputes did not arise. The
decision in R.C.Tiwari was not, therefore, relevant or applicable. The
Division Bench of Karnataka High Court committed an error in following
the decision in R.C. Tiwari to hold that the jurisdiction of Labour Court
under the ID Act was barred, in view of section 70 as amended by the
Amendment Act 19 of 1976, even prior to the amendment of Section 70(1)
and (2) by Act 2 of 2000.
19. The decision of this Court in Sagarmal (supra) also related to Madhya
Pradesh. In that case, the appellant was an employee of a Co-operative Bank
and he was removed from service after a disciplinary inquiry. The employee
challenged his removal by seeking a reference to the Labour Court under
section 10 of the Industrial Disputes Act, 1947. A reference was made and
the Labour Court granted him relief of reinstatement with back-wages. The
employer Bank challenged the award in a writ petition and the High Court
quashed the award on the ground that it was a nullity, having been made in
an incompetent reference. While affirming the decision of the High Court,
this Court held that the provisions of the ID Act, did not apply to the
respondent co-operative bank, and the only question was about the
availability of remedy either under the Madhya Pradesh Co-operative
Societies Act, 1960 or under the Madhya Pradesh Industrial Relations Act,
1960. This Court observed that if such a question had arisen, section 93 of
the Madhya Pradesh Co-operative Societies Act would have come into
effect, but no occasion arose for consideration of such question inasmuch as
the employee did not resort to the remedy either under the Madhya Pradesh
Co-operative Societies Act, 1960 or under the Madhya Pradesh Industrial
Relations Act, 1960, but chose the remedy of a reference under Section 10 of
the ID Act, which was inapplicable in the State of Madhya Pradesh. This
Court reiterated that as the only question before the High Court was the
competence of a reference under Section 10 of the Industrial Disputes Act,
1947, and not the availability of the remedy under the Madhya Pradesh Co-
operative Societies Act, 1960 or the Madhya Pradesh Industrial Relations
Act, 1960, the view taken by the High Court that the reference under Section
10 of the ID Act was incompetent, and the award made therein a nullity, did
not suffer from any infirmity. In short, Section 10 of the ID Act was held
inapplicable not because the Madhya Pradesh Co-operative Societies Act,
1960 prevailed over the provisions of the Industrial Disputes Act, 1947 but
because in Madhya Pradesh, the provisions of the ID Act, 1947 (except
certain specified provisions relating to lay off etc.) did not apply in view of
the provisions of the Madhya Pradesh Industrial Relations Act, 1960.
Therefore, the decision in Sagarmal was also of no assistance. Therefore the
decision in Veerashiva Co-operative Bank was erroneous.
20. The Full Bench of the Karnataka High Court in Karnataka Sugar
Workers Federation, decided two issues. Firstly, it upheld the constitutional
validity of amendment of Section 70 of the KCS Act, by Act 2 of 2000. That
question does not arise for our consideration and the decision thereon does
not require to be disturbed. Secondly, it upholds and reiterates the decision
in Veerashaiva Co-operative Bank (supra). To that extent, it is not good
law.
21. In Management of Hukkeri v. S.R. Vastrad [ILR 2005 Karnataka
3882], a learned Single Judge of the Karnataka High Court held that even
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before the amendment of Section 70 by Act 2 of 2000, the legal position
was that Labour Courts and Industrial Tribunals under ID Act did not have
jurisdiction in regard to disputes between society and its employees because
of insertion of clause (d) in Section 70(2) of KCS Act introduced with effect
from 20.1.1976, relying on Veerashiva Co-operative Bank and Karnataka
Sugar Workers Federation. The said decision also, therefore, stands
overruled.
22. The resultant position can be summarized thus :
a) Even though clause (d) was added in Section 70(2) with effect from
20.1.1976, section 70(1) did not exclude or take away the jurisdiction of the
Labour Courts and Industrial Tribunals under the I.D. Act to decide an
industrial dispute between a Society and its employees. Consequently, even
after insertion of clause (d) in Section 70(2) with effect from 20.1.1976, the
Labour Courts and Industrial Tribunals under the I.D. Act, continued to have
jurisdiction to decide disputes between societies and their employees.
(b) The jurisdiction of Labour Courts and Industrial Tribunals to decide
the disputes between co-operative societies and their employees was taken
away only when sub-section (1) and sub-section (2)(d) of section 70 were
amended by Act 2 of 2000 and the amendment received the assent of the
President on 18.3.2000 and was brought into effect on 20.6.2000.
(c) The jurisdiction to decide any dispute of the nature mentioned in
section 70(2)(d) of the KCS Act, if it answered the definition of industrial
dispute, vested thus :
(i) exclusively with Labour Courts and Industrial Tribunals
till 20.1.1976;
(ii) concurrently with Labour Courts/Industrial Tribunals
under ID Act and with Registrar under section 70 of the KCS
Act between 20.1.1976 and 20.6.2000; and
(iii) exclusively with the Registrar under section 70 of the
KCS Act with effect from 20.6.2000.
23. We therefore hold that the award of the Labour Court was not without
jurisdiction. We, however, make it clear that this decision shall not be
applied to re-open matters decided relying on Veerashiva Co-operative Bank
and Karnataka Sugar Workers Federation, which have attained finality.
Re : Question (ii)
24. As we have held that the Labour Court had jurisdiction, the next
question that arises for consideration is the validity of the award. As noticed
above, according to the appellant, the termination was with effect from
1.3.1980. The Labour Court found that the termination was in fact from
19.2.1978. The employee made an application under section 10(4A) of the
I.D. Act on 4.10.1988. But for the insertion of sub-section (4A) in section 10
of the ID Act on 7.4.1988, the appellant’s challenge would not have been
entertained at all as the claim had become stale on account of the same not
being agitated for more than 10 years. The Labour Court, however,
proceeded on the assumption that any claim application filed within six
months from the date when sub-section (4A) was introduced, is to be
considered as in time, irrespective the date of termination or cause of action.
Such assumption is erroneous and would lead to absurd results.
25. Section 10(4A), no doubt, applied to termination orders passed prior
to 7-4-1988. But the question is whether recourse to section 10(4A) can be
had in regard to any order of termination irrespective of when it was passed,
and without reference to any time limit. Section 10(4A) enables an
individual workman to challenge a termination order before the Labour
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Court, within "six months from the date of communication" of such order of
termination. Having thus fixed the time within which such application has to
be filed, the legislature added the words "or the date of commencement of
the Industrial Disputes (Karnataka Amendment) Act, 1987, whichever is
later". What is the Legislative intent behind the said addition? Is it intended
to provide a one time revival to all claims, including stale, dead, non-
existing claims relating to orders of termination passed years or decades
ago? Or does it extend the time only to those who were entitled to seek the
benefit of Section 10(4A) as on 7-4-1988 on account of communication of
termination orders within six months before that date by giving them a
uniform time limit of six months from 7-4-1988, to approach the Labour
Court?
26. The Legislative intent should be ascertained by keeping in view the
position before the amendment, the nature of remedy provided, and the need
therefor. It is also necessary to keep in view the general principles relating to
limitation. Statutes relating to limitation are said to be retrospective in nature
in the sense that that apply to all proceedings brought after they come into
force, even for enforcing causes of action which had accrued prior to the
date when such statute came into force. But they are also prospective in the
sense that they do not have the effect of reviving a right of action which was
already barred on the date of its coming into operation. Therefore, where the
right to file an action had come to an end on expiry of period of limitation
prescribed under a law relating to limitation and thus becomes barred by
limitation, the right is not revived by a later limitation Act, even if it
provides a longer period of limitation. Let us illustrate with reference to an
action for which the period of limitation was one year under the Limitation
Act, 1908 and three years under the new Limitation Act, 1963 which come
into force on 1.1.1964. The Limitation Act, 1963 will apply to all suits filed
after 1.1.1964, though the cause of action might have accrued before that
date. But if cause action had accrued on 1.1.1962, and therefore, the right to
file a suit came to an end on 1.1.1963 under the old Act, a suit cannot
obviously filed on 1.4.1964, on the ground that the suit is within time as per
the new law of limitation. In other words, any law relating to limitation,
though will apply to cause of actions accruing earlier, will apply only if the
cause of action was ’live’ as on the date when the new Act came into force
and not to claims which were ’dead’ or unenforceable when the new law
came into force. This general Rule is however subject to any express
statutory provisions to the contrary.
27. This Court while dealing with Section 10(1)(c) and (d) of the ID Act,
has repeatedly held that though the Act does not provide a period of
limitation for raising a dispute under Section 10(1)(c) or (d), if on account of
delay, a dispute has become stale or ceases to exist, the reference should be
rejected. It has also held that lapse of time results in losing the remedy and
the right as well. The delay would be fatal if it has resulted in material
evidence relevant to adjudication being lost or rendered unavailable [vide -
Nedungadi Bank Ltd vs. K. P. Madhavan kutty [2000(2) SCC 455]; Balbir
Singh vs. Punjab Roadways [2001 (1) SCC 133]; Asst. Executive Engineer
vs Shivalinga [2002 (1) LLJ 457]; and S.M. Nilajkar vs. Telecom DT.
Manager [2003 (4) SCC 27] ]. When belated claims are considered as stale
and non-existing for the purpose of refusing or rejecting a reference under
Section 10(1)(c) or (d), in spite of no period of limitation being prescribed, it
will be illogical to hold that the amendment to the Act inserting section
10(4A) prescribing a time limit of six months, should be interpreted as
reviving all stale and dead claims.
28. The object of Section 10(4A) is to enable workmen to apply directly
to the Labour Court for adjudication of disputes relating to termination,
without going through the laborious process of seeking a reference under
section 10(1) of ID Act. The Legislative intent was not to revive stale or
non-existing claims. Section 10(4A) clearly requires that a workman who
wants to directly approach the Labour Court, should do so within six months
from the date of communication of the order. Then come the words "or the
date of commencement of the Industrial Disputes (Karnataka Amendment)
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Act, 1987, whichever is later". The reason for these words is obvious. In
cases where the cause of action arose prior to 7.4.1988, some additional time
had to be provided to make the provisions effective. Let us take the example
of a workman who had received the termination order on 10-10-1987. If
section 10(4A), which come into effect on 7.4.1988, had merely stated that
the application had to be filed within six months from the date of
communication, he had to file the application before 10-4-1988, that is
hardly three days from the date when the amendment came into effect. The
Legislature thought that workmen should be given some reasonable time to
know about the new provision and take steps to approach the Labour Court.
Therefore, all workmen who were communicated orders of termination
within six months prior to 7-4-1988 were given the benefit of uniform six
months time from 7-4-1988, irrespective of the date of expiry of six months.
When a new remedy or relief is provided by a statute, such a transitional
provision is made to ensure that persons who are given a special right, do not
lose it for want of adequate time to enforce it, though they have a cause of
action or right as on the date when the new remedy or relief comes into
effect.
29. Section 10(4A) does not therefore revive non-existing or stale or dead
claims but only ensures that claims which were live, by applying the six
month rule in Section 10(4A) as on the date when the Section came into
effect, have a minimum of six months time to approach the Labour Court.
That is ensured by adding the words "or the date of commencement of the
Industrial Disputes (Karnataka Amendment) Act, 1987, which is later" to the
words "within six months from, the date of communication to him of the
order of discharge, dismissal, retrenchment or termination." In other words
all those who were communicated orders of termination during a period of
six months prior to 7-4-1988 were deemed to have been communicated such
orders of termination as on 7-4-1988 for the purpose of seeking remedy.
Therefore, the words "within six months from the date of commencement of
the Industrial Disputes (Karnataka Amendment) Act, 1987, whichever is
later" only enables those who had been communicated order of termination
within six months prior to 7-4-1988, to apply under Section 10(4A).
30. Section 10(4A) provides an alternative procedure to seek redressal in
regard to an order of termination, by making an application directly to the
Labour Court, within six months from the date of communication of the
order of termination, without the intervention or assistance of an employees
union and without having to approach the appropriate Government for
making a reference. Such a provision cannot be interpreted as reviving stale
and dead claims nor as enabling a workman to seek remedy beyond six
months from the date of communication, except to the extent expressly
provided for. The true and proper interpretation of Section 10(4A) is that an
individual workman can apply to the Labour Court for adjudication of the
dispute relating to an order of discharge/dismissal/retrenchment/termination
within six months from the date of communication to him, of such order of
termination. Where such remedy becomes available to a workman as on 7-4-
1988 on account of his having received the communication of termination
order within six months prior to 7-4-1988, then the six months period stands
extended upto 7-10-1988. To summarize :
(i) In regard to termination orders communication on or after 7-4-
1988, the outer limit for making an application under Section
10(4A) is six months from the date of communication of the order.
(ii) In regard to termination orders communicated during a period of
six months prior to 7-4-1988, the period of limitation would be up
to 7-10-1988 even though the six months period from the date of
communication may actually expire between 7-4-1988 to 7-10-
1988.
(iii) In regard to termination orders communicated prior to 7-10-1987,
no claim application under Section 10(4A), could be filed, as there
is no provision for such applications. The remedy under section
10(1) (c) and (d) will continue to be available, subject, however, to
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the rule that stale and dead claims will not be referred.
The intent of Section 10(4A) is to give a right to the aggrieved workman to
challenge the termination order within six months from the date of accrual of
cause of action and not to furnish an one time revival in regard to stale and
non-existing claims. Therefore, a claim application of the petitioner filed on
4.10.1988 in regard to alleged termination on 1.3.1980 (or 19.2.1978 as
found by the Labour Court) was not maintainable under Section 10(4A) of
ID Act and could not have been entertained by the Labour Court.
31. We, therefore, find no reason to interfere with the final order in the
judgment of the High Court setting aside the award, though for different
reasons. The appellant is not entitled to any relief. The appeal is, therefore,
dismissed. Parties bear respective costs.