Writ Petition No.2633 of 2012,Writ Petition No.9863 of 2012

18th July, 2013

Petitioner Counsel: Mr. J.P. Cama,,S. Udeshi
Respondent Counsel: Mr. Kiran Bapat,Mr. A.H. Fatangare

Cases Cited:
National Engineering Industries Ltd Vs. State of Rajasthan, AIR 2000 SC 469 [Para 4,17]
Harnam Singh & others Vs. Punjab State Electricity Board & ors., (2001) 10 SCC 526 [Para 7,20]
M/s. Agra Electric Supply Company Limited, Agra and Workmen, 1983 (1) LLJ 304 [Para 12]
The Indian Express Newspapers (Bombay) Pvt. Ltd. & Another Vs. Employees' Union and others, 1978 (2) SCC 188 [Para 12]
Management of Express Newspapers (Pvt) Ltd. Madras Vs. The workers and others, AIR 1963 SC 569 [Para 12]
Workmen of Dimakuchi Tea Estate Vs. Management of Dimakuchi Tea Estate, AIR 1958 SC 353 [Para 14]
The Standard-Vaccum Refining Co. of India Ltd. Vs. Their Workmen and another, AIR 1960 SC 948 [Para 14]
Workmen of the Food Corporation of India Vs. Food Corporation of India, (1985) 2 SCC 136 [Para 16]
Maharashtra Engineering Plastic & General Kamgar Union Vs. Chamundi Petroleum & Two Ors., 2006 III CLR 372 [Para 18]

JUDGMENT

M.S. SONAK, J. :- By an order dated 24th September, 2012, the parties were put to notice that these writ petitions may be finally decided at the admission stage.

Rule. Rule is made returnable with the consent of all the parties forthwith.

2. The petitioner challenges the order of reference dated 9th July, 2012 made under the Industrial Disputes Act, 1947 (hereinafter referred to as 'said Act') by the State of Maharashtra (respondent No.1) and the Additional Labour Commissioner (respondent No.2) at the behest of Voltas Employees Union (respondent No.3).

3. Mr. Cama appearing for the petitioner in both the matters, at the outset, submitted that there is no appreciable difference in the facts in Writ Petition No.2663 of 2012 and Writ Petition No.9863 of 2012, except that whereas in Writ Petition No.2663 of 2012 issue of "contract labour" is involved and in Writ Petition No.9863 of 2012 issues of "casual labour" and "contract labour" are involved. Accordingly, both these petitions are being disposed of, by this common judgment and order. For sake of convenience, however, the facts in Writ Petition No.2663 of 2012 have been adverted to.

4. The challenge to the impugned order of reference is based on the following grounds;

A] The order of reference concerns "contract labour", who are not employees of the petitioner company. There is no'employer-employee' relationship between the petitioner company and such "contract labour". As such, the dispute is in respect of the persons, who are not "workmen" under Section 2(s) of the said Act. Inasmuch as this jurisdictional aspect has been ignored, the impugned reference order is vitiated by non-application of mind and is consequently required to be quashed and set aside.

B] As per the constitution of respondent No.3 Union, the Union can espouse the cause of its own members only. The membership of the Union is limited to the permanent employees of the petitioner company.The dispute now raised, pertains to "contract labour", who are not even employees of the petitioner company, much less permanent employees. Therefore, the Union as per its own constitution had no right or locus standi to espouse the cause of such "contract labour". The impugned reference order made at the behest of respondent No.3 Union is consequently ultra-vires and without jurisdiction.

C] Respondent No.3 Union has filed two complaints (ULP) Nos. 342 of 2004 and 439 of 2009 for claim of permanency on behalf of "contract labour" and the complaint (ULP) No.342 of 2004 has been dismissed by the Industrial Court, Maharashtra by judgment and order dated 20th April, 2011. In view thereof, the impugned reference order referring similar demands of the 3rd respondent for adjudication to the Industrial Tribunal are hit by bar of Section 59 of the MRTU and PULP Act, 1971.

D] Mr. Cama relied upon the decision of the Supreme Court in the case of National Engineering Industries Ltd Vs. State of Rajasthan, AIR 2000 Supreme Court 469, in support of his contention that the High Court has jurisdiction to entertain a writ petition challenging an order of reference made under the Industrial Disputes Act, 1947 and that an Industrial Tribunal, which is a creation of statute cannot go into the question of validity of reference. He placed particular reliance upon paragraph Nos.27,28 and 29 of the judgment.

5.[A] Mr. Bapat appearing for the 3rd respondent Union, countered by pointing out that the appropriate Government whilst making the impugned reference order has specifically kept the issue of locus standi of 3rd respondent open for adjudication before the Industrial Tribunal. He further contended that "contract labour", were the members of the Union and in any case, in terms of section 2 (k) of the Industrial Disputes Act, 1947, the Union comprising direct employees of the employer were competent to raise industrial disputes with regard to the persons, who may not be 'workmen' under section 2(s) of the Industrial Disputes Act, 1947.

5.[B] Mr. Bapat further submitted that there were binding settlements between the petitioner company and the 3rd respondent Union, whereunder the petitioner had agreed in principle not to engage "contract labour" for works of permanent nature within the establishments. He referred us to demand No.20 of Memorandum of Settlement placed on record by the 3rd respondent Union. He submitted that engagement of "contract labour" in breach of terms of binding settlement certainly gives rise to an industrial dispute under section 2 (k) of the Industrial Disputes Act, 1947 and the appropriate government was therefore well within its power in making the impugned reference.

6. In the context of complaint under MRTU and PULP Act, 1971 and the decision thereon, Mr. Bapat submitted that the same did not pertain to the present establishment and in any case, this is not a jurisdictional issue, which needs to be gone into by this Court in exercising of extra-ordinary jurisdiction under Article 226 and 227 of the Constitution of India.

7. Mr. Bapat also placed reliance upon the decision in the case of Harnam Singh & others Vs. Punjab State Electricity Board & ors., (2001) 10 Supreme Court Cases 526, to contend that the appropriate Government in making a reference of section 10(1) of Industrial Disputes Act, 1947 exercises administrative powers and that the High Court ought not to examine a challenge to a reference order, as if sitting in appeal.

8. Having considered the respective submissions in our judgment, no case is made out to interfere with the impugned order of reference for the reasons which we shall indicate.

9. A perusal of charter of demands dated 21st April, 2010, in pursuance of which, the impugned reference came to be made makes it clear that there was sufficient material on record for the appropriate Government to be satisfied of the existence of an industrial dispute between the petitioner and the respondent No.3 Union. The charter of demands makes specific reference to the settlement and memorandum of understanding between the petitioner company and respondent No.3 Union, wherein the petitioner company had agreed in principle that there should be no engagement of "contract labour" where the nature of work was permanent or perennial in nature. The charter of demands protests against the petitioner extracting, under the guise of 'contract labour' or 'casual labour' works of a permanent or perennial nature and alleges that this amounts to exploitation. In the light of these circumstances, the 3rd respondent Union demanded parity in wages and other benefits to casual and contract labour at par with permanent employees and that such causal and contract employees be made permanent and paid wages and benefits from the dates on which such employees started working for the company. The operative portion of charter of demands reads as follows:

DEMANDS

1. The employees employed in the Thane factory as casual labourers, contract labourers and temporary for discharging perennial nature of work, enlisted in the Annexure hereto shall be paid wages and benefits at par with the employees on the roll of the Company from the day they started working for the Company in the Thane Factory.

2. All the employees employed as Contract labourers, casual labourers etc whose names are mentioned at Annexure hereto shall be made permanent in the employment of the Company w.e.f. 1.1.2010 and arrears of wages and benefits shall be paid to them with interest @ 12% per annum w.e.f. from the date on which the employees started working for the Company as mentioned in Annexures.

3. No employee shall be employed as contract labour or casual labour to discharge permanent and perennial nature of work in the Thane Factory and its precincts and the contract Labour guideline the Management signed with the Federation shall be implemented in its letter and spirit.

10. The impugned reference order dated 9th July, 2012 records prima-facie satisfaction of the existence of dispute fit to be referred for adjudication to the industrial Tribunal. The terms of reference have been set out in schedule A and B and the same reads as under :

Schedule A

1. Can the Union raise an industrial dispute on behalf of the workmen enlisted in attached Annexure though they are not members of Union (as per its Constitution)

2. If yes, whether demands raised vide letter dated 24.04.2010 alongwith attached Annexure are legal and justifiable ?

Schedule/Annexure-B

1. The Company shall recruit all employees in the bargainable category to discharge clerical, manual, technical work of permanent and perennial nature, including servicing of Air Conditioners at customers sites, which are necessary and incidental to business of the Company in its establishments, offices in Mumbai.

2. All the employees enlisted at Annexure to this Demand shall be treated as permanent employees of the Company w.e.f. 1.4.2010 and all the benefits, perquisites and wages as applicable to the employees on the roll of the company in the bargainable category shall be extended to the employees with effect from 1.4.2010.

3. Arrears of wages, benefits and perquisites to the employees shall be paid w.e.f 1.4.2010 with interest @ 12% per annum w.e.f 1.4.2010."

11. It is settled position in law that the terms of reference are never to be construed pedantically. The order making a reference has to be read alongwith pleadings of the parties and other circumstances with a view to cull out therefrom, the various points about which the parties are at variance leading to the dispute and to determine the real nature of the dispute. The parties are to be offered an opportunity before the industrial Tribunal to file their statements of claim and response. As long as the parties do not travel way beyond the terms of the reference, the Tribunal would be well within its jurisdiction in adjudicating the dispute between the parties.

12. In the case between M/s.Agra Electric Supply Company Limited, Agra and Workmen, 1983 (1) LLJ page 304, the Supreme Court observed as follows :

"It is plain that industrial jurisprudence is an alloy of law and social justice and one cannot be too pedantic in construing the terms of a reference respecting a dispute for industrial adjudication. Liberally viewed, we are left with the impression that the Tribunal's construction of the terms of reference is correct."

In the case of The Indian Express Newspapers (Bombay) Pvt. Ltd. & Another Vs. Employees' Union and others 1978 (2) SCC 188. The supreme Court, in the context of interpretation of terms of a reference observed thus:

"But we agree with Sri Ramamurthy that liberality, not pedantry, must guide the construction of the language of the reference (vide Express News-papers Ltd. V. Workmen, (1963) 3 SCR, 540, 555: AIR 1963 SC 569). Once the real controversy is clear, the verbal walls cannot narrow the natural ambit of the subject-matter; especially in an equitable jurisdiction unbound by processual blinkers and niceites of pleading."

In the case of Management of Express Newspapers (Pvt) Ltd. Madras Vs. The workers and others, AIR 1963 Supreme Court 569, the Supreme Court observed thus:

"An order of reference hastily drawn or drawn in a casual manner often gives rise to unnecessary disputes and thereby prolongs the life of industrial adjudication which must always be avoided. Even so, when the question of this kind is raised before the Courts, the Courts must attempt to construe the reference not too technically or in a pedantic manner, but fairly and reasonably."

13. Applying the aforesaid principles to the facts and circumstances of the present case, and taking into consideration the settled legal position that in making a reference under the said Act, the appropriate Government exercises administrative function and not adjudicatory function, the impugned reference order in the present case cannot be faulted. The issue as to whether 'employee-employer relationship' exist between the parties or not, will involve disputed questions of facts and consequently adjudication. The Industrial Tribunal, which will have before it pleadings of both the parties, will be in the best position to adjudicate upon such issues. The petitioners demand is not merely to regularise the services of such persons from a particular date related to the proceedings but from an earlier date. The demand is not merely to make them permanent but for a declaration that they are permanent. Suffice to say that we do not find this to be a case where there was no material before the appropriate Government for making the impugned references, or that in making impugned references,the appropriate Government has taken into consideration extraneous or irrelevant considerations or ignored germane and relevant considerations. We also do not find that this to be a case where there has been non-application of mind on part of the appropriate Government.

14. The judgments relied upon by Mr. Bapat establishes the petitioner's case.

[A] In the case of Workmen of Dimakuchi Tea Estate Vs.Management of Dimakuchi Tea Estate, AIR 1958 SC 353, the Supreme Court held that :

"Where the workmen raise a dispute as against their employer, the person regarding whose employment, non-employment, terms of employment or conditions of labour, the dispute is raised need not be, strictly speaking, a 'workman' within the meaning of the Act but must be one in whose employment, non employment, terms of employment or conditions of labour, the workmen as a class have a direct or substantial interest."

[B] In the case of the Standard-Vaccum Refining Co. of India Ltd. Vs. Their Workmen and another, AIR 1960 Supreme Court 948, a dispute was raised by the workmen of refinery company with respect to contract labour employed by the company. The workmen wanted that the contract system should be abolished and the workers under the contractor should be treated as workers of the company. It was further, contended by the company that there was no industrial dispute and that it was not open for the workmen to raise dispute with respect to the workers of the contractor. This contention was negatived by reference to the definition of "industrial dispute" as contained in section 2(k) of the Industrial Disputes Act, 1947.

15. Therefore, it is not as if workmen in an establishment or a Union of workmen in the establishment, cannot raise a dispute in respect of persons who may not be strictly speaking a 'workmen' within the meaning of section 2(s)of the Industrial Disputes Act, 1947, as long as the persons are those in whose employment, non-employment, terms of employment or conditions of labour, the workmen as a class have a direct and substantial interest. In this case, the Union in its charter of demands has alleged that very engagement of contract labour in respect of the work which was of a perennial nature or a permanent nature constituted a breach of the binding settlement between the petitioner company and the Union. Further the Union has demanded benefit of permanency from the date such employees started working for the company and not mere abolition of contract labour from any prospective date. In these circumstances, it cannot be said that there is any jurisdictional infirmity in the impugned order of reference.

16. The decision of the Supreme Court in the case of the Workmen of the Food Corporation of India Vs. Food Corporation of India, (1985) 2 SCC 136, relied upon by Mr. Cama is clearly distinguishable. The issue, involved in the present petitions, was not involved before the Supreme Court. The said judgment is not an authority for the proposition that the workmen or the Union cannot raise any industrial dispute against their employer in respect of the persons regarding whose employment, non-employment, terms of employment or conditions of labour, they as a class have direct or substantial interest, notwithstanding the circumstance that such person or persons may not strictly speaking be 'workmen' within the meaning of the said Act.

17. The issue of locus standi of 3rd respondent Union to espouse the cause of such employee has been specifically kept open as per the terms of the reference itself. In the circumstances, there is no occasion to scan and interpret the provisions of the constitution of respondent No.3 Union and to give any finding upon the issue. The dictum in the case of National Engineering Industries Ltd. (supra) shall not come in the way of the petitioner to raise the issue of locus standi since the appropriate Government has specifically kept the issue open for adjudication before the Industrial Tribunal.

18. The decision in the case of Maharashtra Engineering Plastic & General Kamgar Union vs. Chamundi Petroleum & Two Ors., 2006 III CLR 372, was rendered by the learned Single Judge of this Court, after completion of adjudication under MRTU and PULP Act. In the present case, there has been no adjudication as yet. Besides, the impugned reference order itself keeps this issue open for adjudication by the Industrial Tribunal. In the circumstances, we do not deem it fit to interfere with the impugned reference order.

19. Again on the aspect of incompetency in view of provision of Section 59 of the MRTU and PULP Act, 1971, there is no bar to the petitioner company raising such defence before the Industrial Tribunal. This is not an issue which goes to the root of the jurisdiction. The raising of this issue is not questioning the very reference itself. In fact at ground 'J' of the petition, in the context of the judgment and order dated 20th April, 2011 passed by the Industrial Court, Maharashtra dismissing the complaint under MRTU and PULP Act, 1971, the petitioner themselves have sought to rely upon the principles of res-judicata and/or constructive res-judicata. This defence shall have to be raised before the Industrial Tribunal itself. The adjudication upon such issue would involve detailed examination of factual aspects, which may not be conveniently carried out by this Court whilst exercising extra-ordinary jurisdiction under Article 226 and 227 of the Constitution of India. Besides, the impugned reference order also makes reference to 'casual labour' and it has rightly not been contended by Mr.Cama that 'casual labour' is not covered under the definition of 'workmen' under Section 2(s) of the Industrial Disputes Act, 1947 or that any dispute in respect of 'casual labour' does not answer the definition of industrial disputes under section 2(k) of the said Act. It is not possible to truncate the order of reference, particularly when it cannot be disputed that in making a reference, the appropriate Government merely exercises administrative powers.

20. Ultimately, it is open to the Industrial Tribunal to mould the relief in the facts and circumstances as they unfold in the course of adjudication. Merely because the Tribunal may not be ultimately in a position to grant some of the reliefs, is no ground to interfere with the impugned reference order. As observed by the Supreme Court in the case of Harnam Singh and others (supra), the scope of investigation in a matter where reference order itself is challenged before the High Court is very limited and the High Court is not expected to examine such matters, as if sitting in appeal on the reference made.

21. In the circumstances, the petitions fail and are hereby dismissed. There shall, however, be no order as to costs.

22. The application for stay of this order for six weeks is rejected as, in any event, the proceedings are not likely to commence for that period inter alia on account of the fact that the petitioners are still to file their reply to the statement of claim.

Ordered accordingly.