Judgment P. S. Mishra, B. Prasad JJ. 1. Petitioners herein allege that the respondents have committed error of law in refusing to make a reference of the industrial dispute with respect to the dismissal of the petitioner No.2 by the management of National Jute Manufactures Corporation Unit R. B. H. M. , which is represented before us through its Executive Director. Facts which do not appear in dispute are that the petitioner was appointed by the management of R. B. H M. Jute Mills Pvt. Ltd. which was a private Limited company operating at Katihar. The said management was taken over by the Central Government under the Industries Development and Regulation Act, 1951, and thereafter under the Jute Companies (Nationalisation) Act, 1980. A notification was issued under Sec.6 of the said Act according to which the undertaking previously under the Private Limited Companies Management became the unit of the National Jute Manufactures Corporation, respondent no.3 Petitioners have alleged that under Sec.12 of the Nationalisation Act like other employees who were immediately before the appointed date employed in the undertaking became employees of the Central Government and thereafter when the management vested in the National Jute Manufactures Corporation, employees of the Corporation. Petitioners have alleged that petitioner No.2 was in the service of the erstwhile management on the due date i. e.21-12-1980. He however, was served with an officer order dated 18-4-1981 stating that he was dismissed from service w. e. f.23-5-1980. According to the petitioners, the said order of dismissal was bad in law for several reasons. Petitioners accordingly demanded a conciliation and when the conciliation failed a reference under Sec.10 of the Industrial Disputes Act. Petitioners have alleged that on some allegations petitioner No.2 was subjected to a criminal prosecution for offences punishable under Sections 465, 468, 467 and 477-A of the Indian Penal Code but was acquitted. Notwithstanding the said acquittal, however he was subjected to a proceeding and notwithstanding his objection as to the validity of the said proceeding he was orderd to be dismissed from the service as aforementioned. Notwithstanding the said acquittal, however he was subjected to a proceeding and notwithstanding his objection as to the validity of the said proceeding he was orderd to be dismissed from the service as aforementioned. The order refusing to reference, however, states that since the petitioner was dismissed from service with effect from 23-5-1980 on which date he was employed under the erstwhile management of the Jute Mills, he was not an employee of the management of National Jute Manufactures corporation on the due date, and, therefore, not an employee who could raise a dispute with the respondent No.3, namely, National Jute Manufactures corporation. The order is patently bad in law. The management of the respondent No.3 although designed the order to remove the petitioner No 2 from service with effect from 23-5-1980 could not give effect to the said order from a date prior to the issuance thereof that is to say 18-4-1981. Even this whether the petitioner could be dismissed by the respondent No.3 with effect from a date when respondent No.3 had no control upon the management of the mill and also as to whether there could be any retrospective removal/dismissal from the service or not is a question that may in a given case be an industrial dispute. In the instant case, however, since this fact is not in dispute that the order dismissing the petitioner was issued by the Chairman of the Management Board of the respondent No.3 on 18-4-1981 the only possible conclusion is that the dismissal order became effective on and from 18-4-1981. That being the position in law petitioner No.2 evidently was an employee of the respondent No 3 on 18-4-1981 that is to say a date after the due date of take over that is to say 21-12-1980. 2. Facts aforementioned leave no doubt that the question as to whether petitioner No.2 was wrongfully dismissed by the respondent No.3 or not, is an industrial dispute. 3. State Governments jurisdiction under Sec.10 of the Industrial disputes Act to make a reference of the industrial dispute is confined to the satisfaction as to whether any industrial dispute existed or not or is apprehended or not. It has no jurisdiction to from its own opinion about the correctness or otherwise of the allegations made by either party to the dispute. It can not come to its own conclusion on the merits of the dispute. It has no jurisdiction to from its own opinion about the correctness or otherwise of the allegations made by either party to the dispute. It can not come to its own conclusion on the merits of the dispute. It, however, can determine the issues which emerge from the facts placed before it but can not record any finding to say that although a dispute has been raised and parties are at issue with respect to certain allegations of fact, yet it is not satisfied that an industrial dispute is in existence or is in offing. It shall be, in such a situation, obliged to make a reference. The Supreme Court in The M. P. Irrigation karmachari Sangh V/s. State of M. P. and another, 1985 LAB IC 932, has said ; "there may be exceptional cases in which the State Govern meat may, on a proper examination of the demand, come to conclusion that the demands are either perverse or frivolous and do not merit a reference. Government should be very slow to attempt an examination of the demand with a view to decline reference and courts will always be vigilant whenever the Government attempts to usurp the powers of the Tribunal lor adjudication of valid disputes. To allow the Government to do so would be to render Sec.10 and section 12 (5) of the Industrial Disputes Act nugatory. " the above observations have been made by the Supreme Court after considering the view expressed by the Supreme Court itself in one of its earlier judgment in bombay Union of Journalists V/s. State of Bombay, AIR 1964 SC 1617 . In that case it was observed : "but it would not be possible to accept the plea that the appropriate government is precluded from considering even prima facie the merits of the dispute when it decides the question as to whether its power to make a reference should be exercised under Sec.10 (1)read with Sec.12 (5) or not. If the claim made is patently frivolous, or is clearly belated, the appropriate Government may refuse to make a reference. If the claim made is patently frivolous, or is clearly belated, the appropriate Government may refuse to make a reference. " Observing upon the said view expressed by the Supreme Court in its earlier judgment in M. P. Irrigation Karmachari Sangh (Supra) the Supreme Court has said: "section 10 permits appropriate Government to determine whether dispute exists or is apprehended and then refer it for adjudication on merits The demarcated functions are (1) reference (2) adjudication. When a reference is rejected on the specious plea that the government can not bear the additional burden, it constitutes adjudication and thereby usurpation of the power of quasi-judicial tribunal by an administrative authority namely the Appropriate government. In our opinion, the reasons given by the State government to decline reference are beyond the powers of the government under the relevant sections of the Industrial Disputes act. What the State Government has done in this case is nor a prima facie examination of the merits of the question involved. To say that granting of dearness allowance equal to that of the employees of the Central Government would cost additional financial burden on the Government is to make a unilateral decision without necessary evidence and without giving an opportunity to the workmen to rebut this conclusion. This virtually amounts to a final adjudication of the demand itself. The demand can never be characterised as either perverse or frivolous. The conclusion so arrived at robs the employees of an opportunity to place evidence before evidence before the Tribunal and to substantiate the reasonableness of the demand. " We have quoted the above only to satisfy ourselves that the view expressed by a Bench of this Court in Jagdish Prasad V/s. State af Bihar and others, 1982 LAB ic 1263, has to be understood as the Supreme Court has explained. " We have quoted the above only to satisfy ourselves that the view expressed by a Bench of this Court in Jagdish Prasad V/s. State af Bihar and others, 1982 LAB ic 1263, has to be understood as the Supreme Court has explained. The summary of the consensus recorded in the aforementioned Bench decision of this Court is in the following words : "it has been repeatedly held not only by a series of Bench decisions of this Court but also by the Supreme Court that on a prima facie examination of the facts if the appropriate Government comes to the conclusion that the claim made is patently frivolous or that the facts were glaringly against the workman concerned and that they do not require any trial or adjudication by an Industrial Tribunal or a Court then it is open to the appropriate Government to say that case is not a fit one for reference. " The judgment of the Supreme Court is clear and categorical. The State Government satisfaction is limited to the demand and not to the issues which will be decided in the event of a reference by the Industrial tribunal. State Governments satisfaction has to be limited to the question as to whether the issues require adjudication or not. 4 On the facts of this case we are satisfied that the State Government has acted without jurisdiction in issuing the order as contained in Annexture 1. The same is accordingly quashed. On the facts of this case we direct the respondent-State Government to examine the issue in accordance with law and refer to the Industrial Tribunal such issues which need adjudication so that effective relief may be granted to the aggrieved party. 5. With the direction as above this application is allowed. Appeal allowed.