The Central Government May Refer Jurisdiction Disputes to a National Tribunal Despite Uncertainty Over the Appropriate Government

The petitioners are service providers for Indian Oil Corporation Limited (IOCL) and claim they have no contractor-principal employer relationship with IOCL, nor any employer-employee relationship with the 90 workmen represented by the Respondent Union.

Following a dispute raised by the Union regarding the retrenchment of 90 workmen, the Deputy Chief Labour Commissioner (Central) issued an order of reference on 29.11.2023 to the Central Government Industrial Tribunal (CGIT).

The petitioners challenged the reference on the grounds that the Central Government is not the "appropriate government" for them and that there is no underlying relationship with the workmen to justify an industrial dispute.

1. Whether the Appropriate Government for the Management of the petitioners is the Central Government or the State Government?

2. Whether the action of the managements in denying re-employment to 90 retrenched workmen is justified, and if not, what relief are they entitled to?

The court relied on Section 10(1-A) of the Industrial Disputes Act, 1947, which empowers the Central Government to refer disputes—regardless of whether it is the "appropriate government"—if the dispute involves questions of national importance or impacts establishments in multiple states.

Reference was made to Workmen Employed by Hindustan Lever Ltd. vs Hindustan Lever Limited (1984), establishing that only a legally made reference can be adjudicated on merits.

The court considered Section 10(5) regarding the inclusion of other establishments in a reference.

The principle that a reference cannot presume an employer-employee relationship when it is contested, citing Steel Authority of India Ltd. vs The State of West Bengal [24.11.2015].

The court found that Issue No. 1 (the identity of the "appropriate government") is valid because Section 10(1-A) specifically allows the Central Government to make a reference to a National Tribunal to determine such questions, even if its status as the appropriate government is not yet established.

Regarding Issue No. 2, the court observed that the authority erroneously presumed the existence of an employer-employee relationship.

Since the petitioners categorically denied such a relationship, the authority should have first framed an additional issue to determine whether said relationship existed before addressing the justification of retrenchment.

By jumping directly to the justification of the action, the reference bypassed a jurisdictional fact.

It quashed Issue No. 2 as not being in accordance with law due to the failure to frame an issue on the disputed employer-employee relationship.

The Tribunal is directed to answer Issue No. 1 independently.

The writ petitions were disposed of and any interim orders vacated.