Paresh Chandra Roy v. Zonal Manager L I C Of India
1969-01-27
B.C.Mitra
body1969
DigiLaw.ai
JUDGMENT 1. THE two petitioners in this Writ petition are Class III and Class IV employees of the Life Insurance corporation of India (Respondent No. 3 ). The petitioners obtained leave under Order 1, rule 8 of the Code of Civil Procedure and made the requisite publication of the advertisement. 2. ON January 29, 1965, the respondent no. 3 entered into a settlement of certain disputes between it and its employees. By this settlement it was agreed that with effect from August 1, 1964, Additional Temporary Dearness allowance =8 % of the basic salary of class IV employees who were governed under the scales of pay, dearness allowance and other allowances in Part a, of Schedule II of Staff Regulations, 1960 and =- 6 per cent of the basic salary of Class III employees who were governed by the said Staff Regulations based on 3 points of the All India working Class Consumer Price Index (base 1949 = 100) over and above what was admissible to the said Class iii and Class IV employees, under clause III of the Memorandum of settlement arrived at between the respondent No. 3 and. the All India Insurance Employees' Association on January 23, 1963, would be given to the said class III and class IV employees until the happening of one or the other of two events namely : (a) the expiry of the said settlement or (b)the 1960 base index figures were available, whichever was earlier. It is clear that from time to time there had been settlement of various matters regarding the employment of the employees of the respondent No. 3 and two of these settlements took place in 1963 and 1965. In the 1965 settlement there were altogether 11 clauses.
It is clear that from time to time there had been settlement of various matters regarding the employment of the employees of the respondent No. 3 and two of these settlements took place in 1963 and 1965. In the 1965 settlement there were altogether 11 clauses. 'clause 7 of this settlement is of importance so far as this Writ petition is concerned and i set out the same below :- "7, Temporary increase in Dearness Allowance : with effect from 1-8-1964, an additional amount of temporary dearness allowance equal to 8 per cent of their basic salary in respect of those Class IV employees who are governed under the scales of pay, D. A. and other Allowances (wherever payable) in Part A of schedule II of (Staff) Regulations, 1960, and equal to 6 per cent of their basic salary in respect of those Class III employees who are governed under the scales of Pay, D. A. and other Allowances (wherever papable) in Part A of schedule II of (Staff) Regulations, 1960, based on 8 points of the All India Working Class consumer Price Index (base 1949 = 100) over and above what is admissible to the said Class IV and class III employees under clause III of the Memorandum of Settlement arrived at between the Corporation and the ail India Insurance Employees' Association on the 23rd January 1963 would be given until (a) the expiry of the said settlement or (b) the 1960 base index figures are available, whichever is earlier". Shortly put clause 7 of the settlement provides that additional Temporary Dearness Allowance = 8 per cent of basic salary of Class IV employees and similar temporary clearness allowance = 6 per cent of the basic salary of Class III employees over and above what is admissible to such employees under the 1963 settlement would be given until either the expiry of that settlement or until the 1960 base index figures are available, whichever is earlier. 3. THE settlement mentioned above received the approval of the Central government under section 49 of the life Insurance Corporation Act, 1965, and was published in the Gazette of India. The settlement was also incorporated in the life Insurance Corporation of India (Staff) Regulations, 1960.
3. THE settlement mentioned above received the approval of the Central government under section 49 of the life Insurance Corporation Act, 1965, and was published in the Gazette of India. The settlement was also incorporated in the life Insurance Corporation of India (Staff) Regulations, 1960. On or about November 18, 1968, a message was issued by the Executive Director of the Respondent No. 3, directing withdrawal of payment of the aforesaid Additional Temporary Dearness allowance with effect from September 1, 1968, and not to pay such clearness allowance from November 1968. It is this message which has occasioned the present Writ petition. The petitioners contend that the respondent No. 3 has no authority or jurisdiction to withhold payment of the additional Dearness Allowance which has been provided for in the 1965 settlement without giving a notice under sections 9a and 19 (2) of the Industrial disputes Act, 1947, (hereinafter referred to at. the act ). Section 9a deals with change in the service condition of the employees and section 19 (2) deals with the question of termination of a settlement Under section 19 (2) a settlement is binding for such period as is agreed upon by the parties and if no period is agreed upon, the settlement is binding for s period of six months from the date on which the Memorandum is signed and shall continue to be binding after the period of six months until expiry of two months from the date on which a notice in writing of intention to terminate a settlement is given by one of the parties to the settlement to the other. 4. SECTION 9a provides that an employer should not change the conditions of service of an employee in respect of matters set out in the Fourth Schedule to the Act without giving the workmen a notice in the prescribed manner of the proposed change or within 21 days of giving such notice. The order of respondent No. 3, mentioned above was intended to be effective with regard to the salary for the month of November 1968. But before this payment could be made and the Additional Temporary Dearness Allowance withheld, the petitioners obtained this Rule Nisi and also an interim injunction restraining the respondents from giving effect to the impugned order for six weeks with liberty to the petitioner to apply for an extension of the interim order.
But before this payment could be made and the Additional Temporary Dearness Allowance withheld, the petitioners obtained this Rule Nisi and also an interim injunction restraining the respondents from giving effect to the impugned order for six weeks with liberty to the petitioner to apply for an extension of the interim order. The interim order was modified from time to time and an application was also moved on behalf of the respondents for vacating the interim order It, is not necessary for me to go into the details of the interim order beyond stating that the payment of the Additional dearness Allowance was postponed upon an undertaking being given on behalf of the respondents that they will pay the Additional Dearness Allowance in the event, of the ad interim order being confirmed. 5. MR. S. K. Acharyya learned counsel for the petitioner contended that the respondents had no right or authority to withhold or stop payment of the Additional Temporary Dearness allowance as agreed upon in the 1965 settlement, as the Settlement still remained in force. It was argued that the payment of the Temporary Dearness Allowance could be validly stopped only by terminating the Settlement, which provided for such payment and not otherwise. It was argued that although there was a provision in the Settlement whereby it was to remain in force for a particular period, and although that period expired the settlement continued to be in force and would so continue until terminated in accordance with section 19 (2)of the Act. In this case, it was further argued, no notice as prescribed by section 19 (2) of the Act was given by the respondents to the employees, and therefore the Settlement could not be terminated or repudiated, and the payment of the Additional Temporary dearness Allowance as prescribed by the Settlement, could not be withheld. It was further argued that as the settlement continued to be in force, the payment of the Additional Temporary dearness Allowance must be made, and must continue to be made, until the settlement itself was terminated by service of a notice by the respondents as contemplated by section 19 (2) of the act. In support of this contention mr. Acharyya relied upon a decision of this court reported in AIR (1957) Cat. 500.
In support of this contention mr. Acharyya relied upon a decision of this court reported in AIR (1957) Cat. 500. In that case a settlement was arrived at between the employer and the employees regarding payment of bonus in course of conciliation proceedings. It provided that it would remain in force until August 26, 1952, and that during the subsistence of the settlement no demand regarding wages, allowances, remuneration, payment of gratuities or bonus were to be made. On September G, 1952, the employees served a notice on the employer of their intention to terminate the Settlement and on the same date a notice was served claiming bonus and thereafter the dispute was referred to a tribunal whose award was the subject-matter of challenge in the Writ petition. Sinha, J. (as his lordship then was) dealing with the question of termination firstly held that even in a case where the period of the settlement was fixed by the terms thereof, upon expiry of that period the agreement continued to be binding until notice in writing Was given of an intention to terminate the settlement and two months thereafter had expired. It was held that a notice terminating the agreement under section 19 (2) of the Act was necessary not only in those cases where the period of the Settlement was fixed, but also in those cases where the period was not so fixed, It was further held that a settlement between the employer and the employees should be maintained as long as possible and until one or the other party expressly repudiated the same. This decision, to my mind, does not touch the question with which I am concerned in this application. What is sought to be done in this case is not a termination or repudiation of a settlement arrived at between the parties thereto, but to give effect to or enforce the terms agreed upon between the parties. This is not a case where something is sought to be done contrary to the terms of the agreement or in violation or derogation thereof. What is sought to be done in this case is to keep the settlement in force and to give effect to the terms thereof.
This is not a case where something is sought to be done contrary to the terms of the agreement or in violation or derogation thereof. What is sought to be done in this case is to keep the settlement in force and to give effect to the terms thereof. In the decision mentioned above the employees made a claim for bonus in derogation of the terms regarding bonus agreed upon in the settlement and they advanced a claim for bonus in excess a what was provided for in the Settlement. But I am not concerned with such a proposition in this case. The respondents in this case, are not seeking to enforce something which is in derogation of the 1967 settlement or contrary to the terms thereof or inconsistent therewith. But what is sought to be done is strictly in conformity with the terms of the settlement, in compliance with it and for the purpose of giving effect to it. 6. THE contention of the learned counsel for the petitioners mentioned above namely that payment of the additional Temporary Dearness Allowance could be withheld only after a notice terminating the Settlement under section 19 (2) of the Act was given suffers from another infirmity. If the Settlement itself is terminated by a notice under section 19 (2) of the Act, it would not be open to the employer to give effect to any term thereof, as upon termination of the Settlement it would it come to an end and would stand extinguished, and neither party to it can seek to enforce any of its terms. The terms of the Settlement can be enforced by other party to it, if and only if, it is a valid subsisting agreement. If the settlement itself comes to an end and stands extinguished upon a notice under section 19 (2) of the Act it would no more be open to the respondents to withhold payment of the temporary dearness allowance in compliance with the terms thereof. The other contention connected with notice is with regard to the notice contemplated by section 9 a of the Act.
The other contention connected with notice is with regard to the notice contemplated by section 9 a of the Act. That section provides that an employer who proposes to effect a change in, the conditions of service of workmen shall not effect such change without giving the workmen likely to be affected by such change a notice in the prescribed manner or within 21 days of giving such notice. This contention of the learned counsel for the petitioners in my view has no merit, as under the proviso to the section no notice is required for effecting any such change, where the change is effected in pursuance of any Settlement. In this case the change sought to be done is admittedly in pursuance of a settlement between the parties and therefore this contention on behalf of the petitioners must fail. 7. THE next contention of Mr. Acharyya was based on section 33 (1) (a) of the Act, which forbids an employer to alter to the prejudice of the workmen the conditions of service applicable to them during the pendency of any proceeding before a labour court or tribunal or national tribunal. It was argued that in this case a reference has been made to a tribunal, of a dispute between the employers and employees and this reference was pending and therefore the change in the conditions of service to the prejudice of the workmen could not be effected by the respondents. In support of this contention my attention was drawn to paragraph 24 of the affidavit-in-reply affirmed by Paresh Chandra Roy on January 2, 1969. In that paragraph it is stated that the Govt. of India by an order dated November 28, 1968, and published in the gazette of India Extra-Ordinary dated Nov. 28, 1968, referred an industrial dispute between the Life Insurance Corporation of India and their Workmen to a national tribunal. It is also alleged in that paragraph that revision of dearness allowance and payment of other allowances were also the subject-matter of the industrial, dispute. A copy of the said order is annexure "y" to the affidavit-in-reply and it appears from the schedule to the order that revision of D. A., and payment of other allowances are questions which have been referred to the: tribunal for adjudication. Mr.
A copy of the said order is annexure "y" to the affidavit-in-reply and it appears from the schedule to the order that revision of D. A., and payment of other allowances are questions which have been referred to the: tribunal for adjudication. Mr. Subimal Roy learned counsel for the respondents sought to repel this contention by submitting that according to the petitioners themselves the impugned order was made before the reference of the dispute to the national tribunal. The date of the order directing stoppage of payment of Additional Dearness allowance, as mentioned in paragraph 9 of the petition, is November 18, 1968 it was argued by Mr. Roy that it could not, on the petitioners' own admission, be said that the service conditions of the employees were sought to be altered during the pendency of a reference to a national tribunal. In my view this contention on behalf of the respondents must be upheld as the reference to the national tribunal was made after the impugned order. 8. ON the question of termination of the settlement Mr. Roy argued that the settlement includes not only any particular term of it but all the 11 terms thereof. It was argued that there were altogether 11 terms or clauses thereof and it is no body's case that the terms other than clause 7 have come to an end or are sought to be altered. It was further argued that the settlement relates to various matters such as retirement age, sick leave, canteens, leave for Trade Union Officials, housing and staff quarters etc: all these terms of the settlements are in force and binding and are being given effect to by both parties. Therefore, it was argued, there is no force in the petitioners' contention that the settlement was sought to be terminated or put an end to by the impugned order. In my opinion Mr. Roy's contention must be upheld.
Therefore, it was argued, there is no force in the petitioners' contention that the settlement was sought to be terminated or put an end to by the impugned order. In my opinion Mr. Roy's contention must be upheld. The settlement includes all the terms thereof and it is not the petitioners' case that the other terms of the settlement have been sought to be altered or varied, The next contention of the learned counsil for the petitioners was that section 49 (1) of the Life Insurance corporation Act, 1956, conferred upon the Corporation the power to make, with the previous approval of the central Government and by Notification in the gazette of India, Regulations not inconsistent with the Act to provide, amongst others, for conditions, of service of the employees of the corporation. It was submitted that as the impugned Order was not made with the approval of the Central Government fend there was no Notification in the Gazette of India of the impugned order, it was invalid. There is hardly any force in this contention. Section 49 (1) of the Life Insurance Corporation Act is an enabling section whereby jurisdiction has been conferred upon the Corporation to make regulations with regard to the matters set out under sub-section (2) thereof. There is nothing in the section which prevents, prohibits or restrains the rights of the employer and the employee to arrive at a settlement of an industrial dispute, even if such a settlement touches questions regarding conditions of service of the employees. The settlement is a settlement under section 2 (p) and section 18 (1) of the Act. Sub-section (p) of section 2 defines a settlement under the Act and sub-section (1) of section 18 provides that a settlement arrived at between the employer and workmen otherwise than the course of conciliation proceeding shall be binding on the parties to the agreement. The right to enter into such a settlement has by no means been curtailed or restricted by section 49 (1) of the Life Insurance Corporation Act, 1956. Furthermore, it cannot be overlooked that the employees of the Corporation have taken the benefit of the settlement of 1963 and of this particular settlement from 1965. The terms of the settlement undoubtedly concerned questions relating to the conditions of service of the employees.
Furthermore, it cannot be overlooked that the employees of the Corporation have taken the benefit of the settlement of 1963 and of this particular settlement from 1965. The terms of the settlement undoubtedly concerned questions relating to the conditions of service of the employees. It is not open to the petitioners to contend at this stage that the terms of this settlement cannot be given effect to as some of them are related to the conditions of service of the employees. 9. THE next contention of the learned counsel for the petitioners was based on clause 9 of the 1965 Settlement which provides that the period of the Settlement should be two years from January 1, 1965. It was argued that the period of this settlement expired on December 31, 1966. But even after the expiry of this settlement, it was argued, the Additional Temporary dearness Allowance was paid by the respondents to the employees for the whole of 1967 and the greater part of 1968. That being so, the respondents, it was argued, could not arbitrarily stop the payment of the Additional Temporary dearness Allowance. There is hardly any force in this contention. The first of the two alternatives mentioned in clause 7 of the 1965. Settlement namely (a) the expiry of the said settlement refers not to the 1965 settlement but to the 1963 settlement as the settlement referred to immediately preceding the term is the settlement arrived at on January 23, 1963. The period of the 1963 settlement as provided in clause XI of that settlement is five years from January 1, 1962, and this five year term expired on December 31, 1966. But before the expiry of this period, the 1965 settlement which was executed on January 29, 1965 came into force. It is clear therefore that the 1963 settlement did not expire and was not determined by notice by either party. So far as the 1965 settlement is concerned, it is for a period of two years from January 1, 1965, and although this settlement was for a fixed term of two years it has not been determined by notice by either party and is still continuing in force and is being given effect to.
So far as the 1965 settlement is concerned, it is for a period of two years from January 1, 1965, and although this settlement was for a fixed term of two years it has not been determined by notice by either party and is still continuing in force and is being given effect to. As I have said earlier the impugned order is not a repudiation of the 1965 settlement but enforcement of the same and what is sought to be done is to give effect to the terms thereof. I cannot accept the contention of the learned counsel for the petitioners, as the first alternative mentioned in clause 7 of the 1965 settlement namely the expiry of the 1963 settlement, never occurred either by efflux of time or by notice by either party to the settlement. 10. MY views as expressed above on the various contentions raised on behalf of the parties are enough to dispose of this application. But I should note some of the other contentions raised by learned counsel on behalf of the respondents. It was argued by learned counsel for the respondents that the settlement between the employees and the respondents was a matter of contract, and therefore the rights of the parties arising out of this contract could be enforced either in an action or by a reference to a tribunal under the Industrial Disputes Act, and that this Court had no jurisdiction under article 226 of the Constitution either to entertain the Writ petition or to grant any relief to the petitioners. I am not impressed by this contention on behalf of the respondents. The Life Insurance corporation of India is a statutory authority, and if this authority acts in excess of the powers conferred upon it by statute, this Court undoubtedly has jurisdiction to interfere and grant relief to the aggrieved party. 11. THE next contention urged on behalf of the respondents was that of the two petitioners, the first petitioner paresh Chandra Roy was the General secretary of the Eastern Zone Insurance Employees' Association. This association, it was argued, was not a registered Trade Union and therefore this petition could not be maintained by an unregistered Trade Union as section 13 of the Trade Unions Act, 1926, required a Trade Union to be a registered society. This contention on behalf of the respondents must also fail.
This association, it was argued, was not a registered Trade Union and therefore this petition could not be maintained by an unregistered Trade Union as section 13 of the Trade Unions Act, 1926, required a Trade Union to be a registered society. This contention on behalf of the respondents must also fail. It is true that the petitioner No. 1 has described himself as the General Secretary of the Eastern Zone Insurance employees' Association, but the petition has been moved by the petitioner No. 1 not on behalf of the unregistered society but as a Class III employee of the respondent No. 3. A reference to the office held by the petitioner No. 1, namely General Secretary, Eastern zone Insurance Employees' Association must be held to be purely descriptive. This description has no reference to the capacity in which the petitioner No. 1 has moved this application. Further there are two petitioners and the petitioner No. 2 is also an employee of the respondent No. 3. This contention of the learned counsel for the respondents also must fail. 12. IN my view the respondents are seeking to enforce a term of the 1965 settlement arrived at between the employers and the employees. If in consequence of the enforcement of the settlement, the employees of the respondent No. 3 are prejudiced, it would not be for this Court to grant them any relief in this Writ petition. A reference regarding various matters has already been made to a tribunal, including the question of dearness allowance. The question whether the petitioners should get the Additional Temporary dearness Allowance would no doubt be a matter for inquiry before the tribunal. The contentions raised on behalf of the petitioners cannot be upheld, on the grounds stated earlier in this judgment. For the reasons mentioned above, this application fails and is rejected. The Rule is discharged. All interim orders are vacated and the respondents are released from the undertaking given by them to this Court. Each party to pay its own costs.