Full Judgment Text
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CASE NO.:
Appeal (civil) 3475 of 2003
PETITIONER:
Kapra Mazdoor Ekta Union
RESPONDENT:
Management of M/s. Birla Cotton Spinning and Weaving Mills Ltd. & Anr.
DATE OF JUDGMENT: 16/03/2005
BENCH:
N. SANTOSH HEGDE,B.P. SINGH & S.B. SINHA
JUDGMENT:
J U D G M E N T
B.P. SINGH, J.
The appellant Kapra Mazdoor Ekta Union has preferred
this appeal by special leave which is directed against the
judgment and order of the High Court of Delhi at New Delhi in
Civil Writ Petition No. 2084 of 1990 dated August 31, 2001
whereby the writ petition preferred by the respondent-
Management of M/s. Birla Cotton Spinning and Weaving Mills
Limited was allowed and the order dated February 19, 1990
passed by the Presiding Officer, Industrial Tribunal No. II,
Delhi was quashed. By the said order the Industrial Tribunal
had in effect recalled its Award of June 12, 1987 and framed an
additional issue to be tried by the Tribunal. The High Court
held that the Award dated June 12, 1987 had effectively
terminated the industrial dispute referred to the Tribunal by the
appropriate Government on December 13, 1982.
With a view to appreciate the submissions urged before us
it would be necessary to notice the factual background in which
these questions have arisen.
The appellant-Union is one of the eight Unions representing
the workers employed in the respondent-Company. In the year 1982
on account of closure of some looms of the Weaving Section of the
Mill disputes arose between the workmen and the Management of
the respondent-Company. The appropriate Government in exercise
of its powers conferred by Section 10(1)(d) and 12(5) of the
Industrial Disputes Act, 1947 (hereinafter referred to as ’the Act’)
referred the said disputes to the Industrial Tribunal, Delhi vide
Notification dated December 13, 1982. The reference was in the
following terms :-
"1. Whether the action of the Management in refusing
duties to a large number of workers is illegal
and/or unjustified, and if so, what directions are
necessary in this regard?
2. Whether the Management is justified in closing
down a large number of looms in the mill and if
not to what relief the affected workers are entitled
and what further directions are necessary in this
respect?"
While the reference was pending before the Industrial
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Tribunal, a settlement is purported to have been arrived at between
the respondent-Management and its workmen. According to the
Management this settlement was reached in the course of
conciliation proceedings with the assistance and concurrence of the
Conciliation Officer, namely the Deputy Labour Commissioner-
cum-Conciliation Officer, Delhi M. Basai. It is the case of the
respondent-Management that after reference of the dispute further
disputes arose between the Management and the Workmen and a
notice of strike was served on the Management and some more
demands were raised. The notice of strike was served on February
14, 1983 and the Management on April 4, 1983 gave notice under
Section 25FFA of the Industrial Disputes Act for closing the
undertaking relating to the Weaving Mill on account of labour
trouble resulting in huge financial losses. It is the case of the
respondent-Management that in these circumstances conciliation
proceedings commenced and after great and sustained efforts, a
settlement was arrived at between the Management and its Workmen
in the course of conciliation proceedings. The settlement has been
reduced into writing, and it is not disputed that the same has been
signed by representatives of the Management as well as the
representatives of two Workers’ Union as also by the Deputy Labour
Commissioner-cum-Conciliation Officer, M. Basai.
In view of the settlement reached between the parties, an
application was moved before the Industrial Tribunal which was
seized of the disputes, which were the subject matter of the reference
made on December 13, 1982, with a prayer that in view of the
settlement reached between the parties the Industrial Tribunal may
be pleased to give its award in terms of the conciliation settlement
dated May 17, 1983. One of the terms of the settlement was to the
effect that both the parties will present a petition before the
Industrial Tribunal, Delhi with a request to accept the terms of the
settlement as fair and reasonable and to give its award in terms of
the settlement in the disputes pending before it pursuant to the
reference made on December 13, 1982.
The application made by the Management for passing an
award in terms of the settlement dated May 17, 1983 was opposed
by the appellant-Union on various grounds. It was submitted by the
appellant-Union that only two of the Unions had signed the
settlement who represented a very insignificant number of workmen.
The settlement was a private settlement and the workers who were
not members of those two Unions were not bound by the settlement.
It was further submitted that in May, 1983, when the settlement is
said to have been arrived at, no conciliation proceedings were
pending before the Conciliation Officer and, therefore, the
Conciliation Officer had no power or justification to record such a
settlement, particularly during the pendency of the earlier reference.
It was also the case of the appellant-Union that the settlement did
not settle the disputes which had been referred to the Tribunal for
adjudication. The settlement was unfair and unjust to the workmen
and, therefore, not acceptable to the appellant-Union.
The appellant-Union filed a writ petition before the High
Court of Delhi at New Delhi contending that the settlement dated
May 17, 1983 was not a conciliation settlement binding upon all the
workmen. The writ petition was dismissed by the High Court by its
order dated January 3, 1986. The matter was brought before this
Court in Special Leave Petition (Civil) No. 1526 of 1985 which was
also dismissed by this Court on August 5, 1986 with the following
observations :-
" We have heard learned counsel for the parties. We
do not see any reason why we should entertain this
Special Leave Petition at this stage. It is conceded that
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the settlement between the employer and certain trade
Unions has been filed before the Industrial Tribunal to
which a reference of this dispute was made and a
settlement was filed before the Tribunal three years ago.
It is for the Industrial Tribunal to dispose of the question
whether the settlement is valid and binding between the
employer and the workmen. It is only after the Industrial
Tribunal has disposed of the matter that this Court may
look into it. While we dismiss the Special Leave
Petition, we may observe that the Industrial Tribunal
should dispose of the question as to the validity and
binding nature of the settlement as expeditiously as
possible. Having regard to the lapse of time which has
taken place we trust that the Industrial Tribunal will be
able to adjudicate on the matter within three months from
today."
In the light of the order of this Court the Industrial Tribunal
heard the parties and passed an Award on June 12, 1987. The
Award is a detailed reasoned Award. The Tribunal took note of the
background in which the disputes had arisen and the reference made
to it. It rejected the argument of the appellant-Union that once a
reference is made, the Labour Department of the appropriate
Government becomes functus officio in the matter. After
considering to the decisions of this Court in State of Bihar vs. D.N.
Ganguly & Ors. : 1959 1 SCR 1191 ; Sirsilk Limited vs.
Government of Andhra Pradesh and another : AIR 1964 SC 160
and Paraga Tools Ltd. vs. Mazdoor Sabha : 1975(I) LLJ 210 it
concluded that merely because a dispute had been referred to the
Industrial Tribunal for adjudication, it did not prevent the
Conciliation Officer from playing his role when other disputes arose
between the parties and the industrial peace was disturbed. It
noticed the fact that in the instant case a notice of strike was given
on February 14, 1983 and a notice of closure of a part of the
undertaking on April 4, 1983. The workers were disturbed and the
atmosphere was surcharged. In this background if the Conciliation
Officer intervened in an attempt to bring about a settlement, it
cannot be contended that he had no jurisdiction to do so. In fact the
Labour Department was not only justified but legally competent and
compelled to set the conciliation proceedings in motion so as to
restore industrial peace.
Having found that the settlement was brought about in the
course of conciliation proceedings, the Tribunal considered the
terms of settlement and recorded the following conclusion :-
" I have carefully gone through the terms of the
settlement. These are not only well bargained but quite
detailed and very sound in the circumstances obtaining.
It’s various items made provision for meeting all the
relevant problems of relief and rehabilitation of the
affected workers because of the closure of weaving
section of the mill and envisages an expert technical body
for deciding on the possibility and extent of the revival of
weaving work in the Mill, under the time bound
schedule. I find the settlement fair and just."
The Tribunal, therefore, concluded that the settlement of May
17, 1983 was a settlement reached between the Workmen and the
Management in the course of conciliation proceedings and hence
binding on all the workers of the respondent-Company. It proceeded
to decide the reference declaring that the disputes stood settled as
between the parties by a valid and binding settlement dated May 17,
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1983 and thus the reference had been rendered redundant. There
was no dispute surviving and no purpose was left in making the
terms of a valid and binding settlement of 1983 as a part of the
award, as all the agreed terms should stood executed and
implemented. The order of the Industrial Tribunal making the
Award is of June 12, 1987. The said Award was duly published by
the appropriate Government in the Gazette on August 10, 1987.
On September 7, 1987 the appellant-Union filed an
application before the Industrial Tribunal to the effect that the only
question which had been argued before the Tribunal was in relation
to the power and jurisdiction of the Conciliation Officer to record
settlement between the parties during the pendency of the disputes.
The question as to whether the settlement was fair and just, and
should be accepted by the Tribunal, was not argued since that
required evidence. It was, therefore, understood that the said
question will be decided later on in case the Tribunal held that the
Conciliation Officer had jurisdiction to record the settlement. Under
some misconception the Tribunal had determined the terms of the
settlement to be fair and just and had passed an Award on June 12,
1987. It was, therefore, prayed that the appellant-Union be given an
opportunity to establish that the settlement was neither just nor fair.
For this purpose the Award may be recalled and the appellant-Union
be given an opportunity to establish that the settlement is unjust and
unfair, adversely affecting a large number of workmen. It was
prayed that the Award may be recalled which was in fact an ex-parte
Award, and the question of fairness of the settlement be decided
after providing an opportunity to the parties to produce evidence.
This application filed by the appellant-Union was strongly
opposed by the respondent-Management, but the successor Presiding
Officer of Industrial Tribunal No.II, Delhi allowed the application.
It observed that a perusal of the order dated June 12, 1987 showed
that the then Tribunal did not make a single observation as to
whether the settlement dated May 17, 1983 was just and fair. No
issue was framed nor any evidence was recorded on that point. No
argument was advanced and no finding was given by his learned
predecessor on this point. Relying upon the judgment of this Court
in Satnam Verma vs. Union of India : 1984 (supp) SCC 712 and
Grindlays Bank Ltd. vs. Central Government Industrial Tribunal
and others : 1980 (Supp) SCC 420 it was held that where the
Tribunal proceeds to make an Award without notice to a party, the
Award is a nullity and, therefore, the Tribunal has not only the
power but also the duty to set aside such an ex-parte Award. It was
held that in the instant case no arguments were advanced and no
finding was given as to whether the settlement was just and fair. In
view of its finding that the Tribunal has power to review its Award
even if the same is published in the Gazette, the Tribunal proceeded
to exercise its power to review its earlier order dated June 12, 1987.
It further framed an additional issue which is as follows:-
"Whether the settlement dated 17.5.1983 is just and fair
and if so, is it not binding on the parties?"
It further directed that only arguments shall be heard since there was
no need to record evidence on this point. Accordingly by its order
of February 19, 1990 the Industrial Tribunal decided to review its
earlier order and framed an additional issue as to whether the
settlement was just and fair.
The Management-respondent herein preferred a writ petition
before the High Court of Delhi at New Delhi and sought quashing of
the order dated February 19, 1990 passed by Industrial Tribunal No.
II, Delhi, and for declaration that the Award dated June 12, 1987
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earlier made by the Tribunal effectively terminated the reference
pending before it. The High Court by its impugned judgment and
order allowed the writ petition and granted the reliefs prayed for.
The judgment and order of the High Court has been impugned
before us in this appeal.
The core question which arises for consideration is whether
the Industrial Tribunal was justified in recalling the earlier Award
made on June 12, 1987 and in framing an additional issue for
adjudication by the Tribunal. According to the appellant the recall
of the order was fully justified in the facts of the case, while the
respondents contend to the contrary. Two issues arise for our
consideration while considering the legality and propriety of the
Tribunal in recalling its earlier Award. Firstly - whether the
Tribunal had jurisdiction to recall its earlier order which amounted
virtually to a review of its earlier order; and secondly - whether the
Tribunal had no jurisdiction to entertain the application for recall as
it had become functus offico. The High Court answered the first
question in favour of the respondent-Management and the second in
favour of the appellant.
We shall first take up the second question namely \026 whether
the Tribunal was functus offico having earlier made an Award which
was published by the appropriate Government. It is not in dispute
that the Award was made on June 12, 1987 and was published in the
Gazette on August 10, 1987. The application for recall was made on
September 7, 1987. Under sub-section (1) of Section 17A of the Act
an Award becomes enforceable on the expiry of 30 days from the
date of its publication under Section 17 of the Act. Thus the Award
would have become enforceable with effect from September 9,
1987. However, the application for recalling the Award was made
on September 7, 1987 i.e. 2 days before the Award would have
become enforceable in terms of sub-section (1) of Section 17A of
the Act. The High Court rightly took the view that since the
application for recall of the order was made before the Award had
become enforceable, the Tribunal had not become fuctus offico and
had jurisdiction to entertain the application for recall. This view
also find supports from the judgment of this Court in Grindlays
Bank Ltd. vs. Central Government Industrial Tribunal and others
(supra). This Court after noticing the provisions of sub-section (3)
of Section 20 of the Act which provides that the proceedings before
the Tribunal would be deemed to continue till the date on which the
Award become enforceable under Section 17A, held that till the
Award becomes enforceable the Tribunal retains jurisdiction over
the dispute referred to it for adjudication, and up to that date it has
the power to entertain the application in connection with such
dispute. The jurisdiction of the Tribunal had to be seen on the date
of the application made to it and not the date on which it passed the
impugned order. The judgment in Grindlays Bank Ltd. vs. Central
Government Industrial Tribunal and others (supra) has been
reiterated by this Court in Satnam Verma vs. Union of India
(supra), J.K. Synthetics Ltd. vs. Collector of Central Excise : (1996)
6 SCC 92 and M.P. Electricity Board vs. Hariram etc. : JT 2004
(8) SC 98.
In the instant case as well we find that as on September 7,
1987 the Award had not become enforceable and, therefore, on that
date the Tribunal had jurisdiction over the disputes referred to it for
adjudication. Consequently it had the power to entertain an
application in connection with such dispute. The order of recall
passed by the Tribunal on February 19, 1990, therefore, cannot be
assailed on the ground that the Tribunal had become fuctus offico.
The question still remains whether the Tribunal had
jurisdiction to recall its earlier Award dated June 12, 1987. The
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High Court was of the view that in the absence of an express
provision in the Act conferring upon the Tribunal the power of
review the Tribunal could not review its earlier Award. The High
Court has relied upon the judgments of this Court in Dr. (Smt.)
Kuntesh Gupta vs. Management of Hindu Kanya Maha Vidyalaya,
Sitapur (U.P.) and others : (1987) 4 SCC 525 and Patel Narshi
Thakershi and others vs. Pradyumansinghji Arjunsingji : AIR 1970
SC 1273 wherein this Court has clearly held that the power of
review is not an inherent power and must be conferred by law either
expressly or by necessary implication. The appellant sought to get
over this legal hurdle by relying upon the judgment of this Court in
Grindlays Bank Ltd. vs. Central Government Industrial Tribunal
and others (supra). In that case the Tribunal made an ex-parte
Award. Respondents applied for setting aside the ex-parte Award on
the ground that they were prevented by sufficient cause from
appearing when the reference was called on for hearing. The
Tribunal set aside the ex-parte Award on being satisfied that there
was sufficient cause within the meaning of Order 9 Rule 13 of the
Code of Civil Procedure and accordingly set aside the ex-parte
Award. That order was upheld by the High Court and thereafter in
appeal by this Court.
It was, therefore, submitted before us relying upon Grindlays
Bank Ltd. vs. Central Government Industrial Tribunal and others
(supra) that even in the absence of an express power of review, the
Tribunal had the power to review its order if some illegality was
pointed out. The submission must be rejected as misconceived. The
submission does not take notice of the difference between a
procedural review and a review on merits. This Court in Grindlays
Bank Ltd. vs. Central Government Industrial Tribunal and others
(supra) clearly highlighted this distinction when it observed :-
"Furthermore, different considerations arise on
review. The expression ’review’ is used in the two
distinct senses, namely (1) a procedural review
which is either inherent or implied in a court or
Tribunal to set aside a palpably erroneous order
passed under a mis-apprehension by it, and (2) a
review on merits when the error sought to be
corrected is one of law and is apparent on the face
of the record. It is in the latter sense that the court
in Patel Narshi Thakershi case held that no review
lies on merits unless a statute specifically provides
for it. Obviously when a review is sought due to a
procedural defect, the inadvertent error committed
by the Tribunal must be corrected ex debita
justitiae to prevent the abuse of its process, and
such power inheres in every court or Tribunal".
Applying these principles it is apparent that where a Court or
quasi judicial authority having jurisdiction to adjudicate on merit
proceeds to do so, its judgment or order can be reviewed on merit
only if the Court or the quasi judicial authority is vested with power
of review by express provision or by necessary implication. The
procedural review belongs to a different category. In such a review,
the Court or quasi judicial authority having jurisdiction to adjudicate
proceeds to do so, but in doing so commits a procedural illegality
which goes to the root of the matter and invalidates the proceeding
itself, and consequently the order passed therein. Cases where a
decision is rendered by the Court or quasi judicial authority without
notice to the opposite party or under a mistaken impression that the
notice had been served upon the opposite party, or where a matter is
taken up for hearing and decision on a date other than the date fixed
for its hearing, are some illustrative cases in which the power of
procedural review may be invoked. In such a case the party seeking
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review or recall of the order does not have to substantiate the ground
that the order passed suffers from an error apparent on the face of
the record or any other ground which may justify a review. He has
to establish that the procedure followed by the Court or the quasi
judicial authority suffered from such illegality that it vitiated the
proceeding and invalidated the order made therein, inasmuch the
opposite party concerned was not heard for no fault of his, or that
the matter was heard and decided on a date other than the one fixed
for hearing of the matter which he could not attend for no fault of
his. In such cases, therefore, the matter has to be re-heard in
accordance with law without going into the merit of the order
passed. The order passed is liable to be recalled and reviewed not
because it is found to be erroneous, but because it was passed in a
proceeding which was itself vitiated by an error of procedure or
mistake which went to the root of the matter and invalidated the
entire proceeding. In Grindlays Bank Ltd. vs. Central Government
Industrial Tribunal and others (supra), it was held that once it is
established that the respondents were prevented from appearing at
the hearing due to sufficient cause, it followed that the matter must
be re-heard and decided again.
The facts of the instant case are quite different. The recall of
the Award of the Tribunal was sought not on the ground that in
passing the Award the Tribunal had committed any procedural
illegality or mistake of the nature which vitiated the proceeding
itself and consequently the Award, but on the ground that some
mattes which ought to have been considered by the Tribunal were
not duly considered. Apparently the recall or review sought was not
a procedural review, but a review on merits. Such a review was not
permissible in the absence of a provision in the Act conferring the
power of review on the Tribunal either expressly or by necessary
implication.
Learned counsel for the appellant then sought to argue that
there was no conciliation proceeding in progress when the alleged
settlement is said to have been reached on May 17, 1983. The
submission ignores the findings of fact recorded by the Tribunal in
its order dated June 12, 1987 that while the reference was pending
before the Tribunal certain events took place which compelled the
Deputy Labour Commissioner-cum-Conciliation Officer to
intervene. As noticed earlier a notice of strike was served on the
Management on February 14, 1983 by one of the Unions. On the
other hand the Management gave notice on April 4, 1983 under
Section 25 FFFA of the Act for closing part of the undertaking
related to the weaving section. These facts leave no manner of
doubt that there was labour unrest coupled with the fear of strike and
closure. The settlement itself recites the fact that there were series
of bipartite and tripartite meetings between the representatives of the
Management and the Unions in view of the labour unrest and threat
of closing down the operation of the weaving department. Meetings
were also held in the office of the Chief Labour Commissioner with
a view to resolve the dispute and a meeting was thereafter held on
May 17, 1983 in the office of Shri K. Saran, Joint Chief Labour
Commissioner (Central) where the representatives of the
Management and the Unions participated alongwith the officers of
the Labour Depatment which ultimately resulted in a settlement. All
these facts establish beyond doubt that there was labour unrest and
the Conciliation Officer intervened in the matter and made attempts
to bring about a settlement. The submission, therefore, that no
conciliation proceeding was in progress when the settlement was
arrived at, must be rejected.
Learned counsel for the appellant then submitted that the
settlement was not arrived at with the assistance and concurrence of
the Conciliation Officer. It was submitted, relying upon the decision
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of this Court in : The Bata Shoe Co. (P) Ltd. vs. D.N. Ganguly and
others : AIR 1961 SC 1158 that a settlement which is made binding
under Section 18(3) of the Act on the ground that it is arrived at in
the course of conciliation proceedings is a settlement arrived at with
the assistance and concurrence of the Conciliation Officer. Such a
settlement brought about while conciliation proceedings are
pending, are made binding on all parties under Section 18 of the Act.
Reliance was placed on the judgment of this Court in Workmen of
M/s. Delhi Cloth and General Mills Ltd. vs. The Management of
M/s. Delhi Cloth and General Mills Ltd. : (1969) 3 SCC 302.
Learned counsel for the respondents did not dispute the legal
position as it emerges from these two judgments. It was submitted
that the facts of this case clearly establish that the Conciliation
Officer intervened when there was considerable labour unrest and
brought the parties to the negotiating table. Several meetings were
held, some of them in the chambers of higher officials of the Labour
Department, and ultimately a settlement was worked out. This is
quite apparent from the fact that the terms of settlement has also
been signed by the Conciliation Officer, apart from the
representatives of the Management and representatives of the two
workers’ Union. We entertain no doubt that the settlement was
brought about in the course of conciliation proceedings with the
assistance and concurrence of the Conciliation Officer.
It was also urged before us by the learned counsel for the
appellant that the Tribunal ought to have considered, while passing
an Award on June 12, 1987, that the settlement was just and fair and
protected the interest of the workmen. The recall of the order was
sought on the ground that this aspect of the matter had not been
considered when an Award was made in terms of the settlement.
This was precisely the ground on which the Tribunal entertained the
application for recall and allowed it by order dated February 19,
1990. The Tribunal in our view proceeded on a factually incorrect
assumption. The High Court has found that the Tribunal while
making an Award in terms of the settlement has in clear terms
recorded its satisfaction in paragraph 25 of its order (which we have
quoted earlier in the judgment) that the settlement was fair and just.
We entirely agree with the High Court.
It was lastly submitted that the settlement did not resolve the
disputes which were subject matter of reference made to the
Tribunal. The submission again proceeds on a misreading of the
settlement. It is no doubt true that the disputes referred to the
Tribunal mainly arose on account of the Management closing down
a large number of looms which necessitated a curtailment of the
work force on account of which the Management refused to give
work to a large number of workers. We find that Clause 3.2 of the
settlement in terms deals with the dispute relating to the weaving
department and other allied departments. This submission,
therefore, has no force.
In the result we find no merit in this appeal and the same is
accordingly dismissed, but with no order as to costs.