Swadeshi Cotton Mills v. Industrial Tribunal — 1991 DIGILAW 891 (ALL)

JUDGMENT S.R. Singh, J. - By means of this petition, the petitioner has sought for issue of a writ in the nature of. certiorari quashing the award dated 1-12-1987 (Annexure 9 to the writ petition) passed by respondent No. 1 in Adjudication Case No. 66 of 1986 as published on 14-3-1988. The aforesaid award traces its origin to a reference made to the Tribunal under Section 4-K of the U. P. Industrial Dispute Act, 1947 (hereinafter referred to as the Act), by notification No. 1206 (shra-Aa)/30-Shram (1)-C-B 1547/84 (Kanpur) dated 25-4-1986. The issue raised in the reference as made by the State Government is quoted below for ready reference : "Kya sewa yojko dwara parishit main ullakhit apne 24 shramiko ko poorv me milanewali masik wetan, 40 din ka avakash, do mah ka advance wetan, tatha uniform ki suvidhao se vanchit karna uchit tatha Vaidhanik hai ? Yadi nahin, to sambandhit shramik kya labhjdhathi purti pane ka adhikari hai tatha kin vivarano sahit ?" 2. The facts of the case are that the concerned workmen are admittedly in the employment of the petitioner working at Swadeshi House, Kanpur which is an administrative office of Swadeshi Cotton Mills Company Limited, Kanpur (hereinafter referred to as the company). 3. It transpires from the facts on the record that at the instance of 15 employees working at Swadeshi House, an industrial dispute (Adjudication Case No. 350 of 1975) was referred to by the Government of U. P. to the Industrial Tribunal which culminated into an award dated 30-10-1982 in which it was postulated that those 15 employees through working at Swadeshi House, Kanpur, were integrally the employees of the Swadeshi Cotton Mills, Kanpur and as such, they were entitled to the same wages and D. A. as was admissible to similarly situated employees working in the Mills. 1 he petitioner company put up a contest to the dispute on the ground that the workmen who were serving at Swadeshi House were not the employees of petitioner's Mills as it was a separate entity and that they were governed by the shops and Commercial Establishment Act and they could not claim parity with the workmen serving in petitioner's Mills governed by the Factories' Act. The Industrial Tribunal however, accepted the claim of the workmen and abnegated the objection put forth on behalf of the petitioner's Mill's and it gave an award in favour of the workmen, working at Swadeshi House holding them to be the employees of petitioner's Mills and also holding them to be entitled to the wages as also other benefits as admissible to the workmen governed by the Factories' Act. As indicated from the facts on record, the Management came up in writ petition in this Court impugning therein the award in Adjudication Case No. 350 of 1975 and the said writ petition ended up in dismissal by this Hon'ble Court on 23-4-1983. 4. It is not disputed before me that the wage structure at Swadeshi House is different from the one obtaining in the petitioner Mills. The wage structure for the employees of the petitioner Mills is indubitably higher than the wage structure for the workmen at Swadeshi House. However, the employees working at Swadeshi House, were enjoying certain benefits not available to the similarly circumstanced employees working at petitioner Mills. These benefits are 40 days holidays with wages, two months' advance salary and uniform allowances etc. In the wake of the award, the Management by means of an office order dated 26-8-1983 purported to implement the award given in Adjudication Case No. 350 of 1975 by declaring the concerned employees working at Swadeshi House as the employees of the petitioner Mills with effect from 18-1-1983. The aforesaid office order covered only those workmen who had raised the dispute in a aforesaid Adjudication Case No. 350 of 1975. Subsequently by another office order dated 26-8-1983, the Management further covered the remaining 17 workmen of Swadeshi House in the light of the award conferring on them also the status of being the employees of petitioner Milts, though they had not raised any dispute. Thus the Management.sums up to have given the benefit flowing from the award in Adjudication Case No. 350 of 1975 to all the employees working at Swadeshi House which were made effective from 1-8-1983. Thus the Management.sums up to have given the benefit flowing from the award in Adjudication Case No. 350 of 1975 to all the employees working at Swadeshi House which were made effective from 1-8-1983. It appears that the benefits of 40 days holidays with wages, two months' advance salary and uniform allowance with the employees working at the Swadeshi House were enjoying and which the employees working at the Mills were not getting, were withdrawn in justification of purported implementation of the award, as a result of which a fresh dispute came into being giving rise to Adjudication Case No. 66 of 1986. The award made in the aforesaid Adjudication Case No. 66 of 1986 has been impugned in the present petition. 5. The learned Counsel for the petitioner contended before me that the employees working at Swadeshi House having been held to be the employees of petitioner Mills are only entitled to those benefits which are admissible to similarly circumstanced employees working at the Mills and that after the award in Adjudication Case No. 350 of 1975, the Management was justified in withdrawing the benefits of 40 days holidays with wages, two months Advance salary and uniform allowances etc. to the employees working at 'Swadeshi House' in as much as they have to be given equal treatment and equal benefits which are available to the similarly circumstanced employees of the Mills in the light of the award in Adjudication Case No. 350 of 1975. According to the learned Counsel for the petitioner, the learned Tribunal has erred in invoking provisions contained in Section 4 (i) of U. P. Industrial Dispute Act, without traversing on the stand of the Management to the effect that the aforesaid benefits had been withdrawn justifiably in implementation of the award given in Adjudication Case No. 350 of 1975 and also in pursuance of the settlement arrived ai between the Management and the employees of Swadeshi House in the light of the Award given in Adjudication Case No. 350 of 1975. The learned Counsel for the respondents on the other hand, contended that the benefits which the employees of the petitioner-Mills working at Swadeshi House were enjoying prior to the award in Adjudication Case No. 350 of 1975, could not have been withdrawn except in due observance of the provisions as contained in Section 4 (i) of U. P. Industrial Dispute Act, 1947 which stipulate inter alia that no employer, who proposes to effect any change in the condition of service applicable to any workman in respect of any matter specified in the third schedule, shall effect such change without giving to the workman likely to be affected by such change, a notice in the prescribed manner of the nature of the change proposed to be effected. 6. The Counsel for the petitioner however, relied upon the Proviso (1) to Section 4 (1) of the Act which sums up that no notice is required for effecting any changes in pursuance of an award settlement or decision of a Tribunal. 7. There is no gain-saying the fact that in view of the Award in Adjudication Case No. 350 of 19/5, the employees of the company working at Swadeshi House have to be treated at par with similarly circumstanced employees of the company working in the Swadeshi Cotton Mills, Kanpur in respect of wages and dearness allowances. However, the question that requires consideration is whether the additional benefits which the workmen engaged at Swadeshi House, Kanpur, were enjoying by way of 40 days holidays with wages, two month's Advance pay and Uniform allowances could be withdrawn in the purported implementation of the Award delivered in Adjudication Case No. 350 of 1975, and if so, whether it could be without observing the requirements of Section 4 (i) of the Act. It is true that in accordance with the Award given in Adjudication Case No. 350 of 1975, the concerned workmen have to be treated at par and on equal footing with the similarly situated employees working at petitioner-Mills in respect of wages and dearness allowances, but the declaration made in Adjudication Case No. 350 of 1975, only clarifies their status of being the employees of the petitioner-Mills from the very beginning of their appointments and not from the date of Award. They were declared to be the employees of the Mills from the date of their induction in to the service entitled to wages and dearness allowances admissible to Mills workers. This necessarily means that being the employees of the Mills, they were getting certain additional benefits as aforesaid while working at Swadeshi House Kanpur and these additional benefits in my firm opinion, could not have been withdrawn except in accordance with the procedure prescribed by Section 4 (D) of U. P. Industrial Dispute Act. The Award given in Adjudication Case No. 350 of 1975, only declares the concerned workmen as the employees of the Mills and it does not vest in the Employer the power to deprive those workmen of the additional benefits which they were getting prior to the Award while working at Swadeshi Bouse. The view taken by the Tribunal in the impugned Award, cannot be said to be tainted with any illegality much less an illegality apparent on the face of the record and the contention raised by the petitioner s Counsel to the contrary, has no merits and cannot be sustained. 8. The question whether the concerned workmen are entitled to the benefits admissible to them under and in accordance with the provisions of U.P. Shops and Commercial Establishment Act, need not be gone into in this petition for the reason that it is not the question of their entitlement for the benefits under the said Act which is relevant here, but what is relevant is the question of withdrawal of benefits being enjoyed by;the workmen prior to the Award in Adjudication Case No. 350 of 1975, otherwise than in accordance with the provisions contained in Section 4 (1) of the Act. 9. The learned Counsel for the petitioner has contended that the withdrawal of benefits was based not only on the Award in Adjudication Case No. 350 of 1975, but it was lawfully made on the basis of settlement dated 30-7-19,83 (Annexure 3 to the writ petition). The rival contention of the learned Counsel for the respondent is that the said settlement has been held to be null and void by the District Judge in Misc. Appeal No. 189 of 1981 decided on 30-1-1984 and Misc. The rival contention of the learned Counsel for the respondent is that the said settlement has been held to be null and void by the District Judge in Misc. Appeal No. 189 of 1981 decided on 30-1-1984 and Misc. Appeal No. 178 of 1981 decided on 30-1-1984 in as much as it was held that the agreement dated 30-7-1983 was void being violative of Section 23 of the Payment of Wages Act. I am fully in agreement with the contention advanced by the learned Counsel for the respondents (workmen). I feel, even otherwise the settlement does not appear to be just and fair and it also does not appear to have been registered under Section 6-B of the Act. Hence, it is not binding on the workmen. 10. The last contention of the learned Counsel for the petitioner is that the Award is not enforceable against the Central Government or the National Textile Corporation in view of Section 5 of the Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Act No. 30 of 1986 (briefly called as the Acquisition Act, 1986). It may be recalled that the Management of Swadeshi Cotton Mills Company Limited running the 6th Textile undertakings including the Swadeshi Cotton Mills, Kanpur was taken over by the Central Government (hereinafter referred to as the Acquisition Act) Under Section 18 (AA) of the Industries (Development of Regulation) Act, 1951 and finally acquired by the Central Government under the provisions of Swadeshi Cotton Mills Company Limited (Acquisition and Transfer of Undertakings) Ordinance No. 5 of 1986 (replaced by Act No. 30 of 1986 and with effect from the appointed day namely the 1st day of April, 1985, the right title and interest of the company in relation to such Textile undertakings stood transferred and vested in the Central Government and immediately thereafter, it stood transferred to and vested in the National Textile Corporation by virtue of Section 3 of the Acquisition Act, but the corporation was not impleaded as a party and instead the Prashasak was impleaded as a party in the reference before the Tribunal. Therefore, the Counsel contends that the reference was incompetent. No such contention appears to have been raised before the Tribunal and points sought to be pressed by the learned Counsel at the Bar are also conspicuously by their absence in the grounds taken in the writ petition. Therefore, the Counsel contends that the reference was incompetent. No such contention appears to have been raised before the Tribunal and points sought to be pressed by the learned Counsel at the Bar are also conspicuously by their absence in the grounds taken in the writ petition. From the array of the parties, mentioned in tire impugned award, it appears that Prashasak, Swadeshi Cotton Mills, was arrayed as party No. 1 together with Swadeshi Cotton Mills under the Management of National Textile Corporation Limited, New Delhi, Johi Kanpur as party No. 2 on one hand and Swadeshi Cotton Mills Clerks and General Staff Union on the other. The reference as quoted hereinafter was made by the Government by notification dated 25-4-1986 and the Administrator appointed under Section 18 (AA) of the Industries (Development of Regulation) Act, 1951 had taken over the Management on 1-4-1985, where as the acquisition. was done by means of the Ordinance referred to hereinbefore having been promulgated on 19th April, 1986 but brought into force, with effect from 1-4-1985 which has been specified as 'appointed day'. The Mills vested in the Central Government and it stood transferred and vested in the National Textile Corporation with effect from 1-4-1985 and from the array of the parties mentioned in the award as noted above, it is clear that the corporation was very well represented and the fact that Prashasak was also described alongwith the corporation would not render the Reference invalid or incompetent, it may be that the corporation was not impleaded as such but. Swadeshi Cotton Mills was impleaded and described under the Management of National Textile Corporation Limited, New Delhi. In view of this finding, I find no substance in the third contention as advanced by the learned Counsel for the petitioner. 11. Next contention in the order, urged by the , learned Counsel for the petitioner is that the Award was not enforceable against the Central Government/National Textile Corporation in View of Section 5 of the Acquisition Act No. 30 of 1986. The learned Counsel in support of this contention has placed reliance upon Section 5 of the Acquisition ordinance in so far as it is relevant for purposes of the present case is quoted below - "5. The learned Counsel in support of this contention has placed reliance upon Section 5 of the Acquisition ordinance in so far as it is relevant for purposes of the present case is quoted below - "5. (1) Every liability of the Company in relation to the textile undertakings in respect of any period prior to the appointed day shall be the liability of the Company and shall be enforceable against it and not against the Central Government or the National Textile Corporation. (2) For the removal of doubts, it is here by declared that, - (a) Save as otherwise expressly provided in this section or in any other section of this Ordinance, no liability of the Company in relation to the textile undertakings, in respect of any period prior to the appointed day shall be enforceable against the Central Government or the National Textile Corporation ; (b) no award, decree or order of any Court, tribunal or other authority in relation to any textile undertaking, passed after the appointed day in respect of any matter, claim or dispute which arose before that day shall be enforceable against the Central Government or the National Textile Corporation ; (c) no liability incurred by the Company in relation to any textile undertaking before the appointed day, for the contravention of any provision of law for the time being in force, shall be enforceable against the Central Government or the National Textile Corporation." 12. The with drawal of the benefits of 40 days leave with wages etc. was done pursuant to office order dated 26-8-83 as the date prior to the appointed day and the award was given on 1-12-87 i.e. after the appointed day. Accordingly, the learned Counsel for the petitioner contends that in view of Section 5, particularly clause (b) of sub-section (2), the Central Government/National Textile Corporation cannot be proceeded against in respect of the aforesaid liability, which is enforceable against the company and not against the Central Government/National Taxtile Corporation. This contention of the learned Counsel for the petitioner, appears to be misconceived, firstly for the reason that question of enforceability of the award against the Central Government or the National Textile Corporation has nothing to do with the validity or other-wise of the impugned award. This contention of the learned Counsel for the petitioner, appears to be misconceived, firstly for the reason that question of enforceability of the award against the Central Government or the National Textile Corporation has nothing to do with the validity or other-wise of the impugned award. Further clause (a) of sub-section (2) makes it abundantly clear that the provisions contained in Section 5 are subject to other provisions contained in the Acquisition Ordinance/Act. In this connection, Sections 12 (1), 18 and 25 (1) of the Acquisition Ordinance/Act being relevant for purposes of the question raised by the learned Counsel may be quoted below. "12. (1) Every person who has been, immediately before the appointed day, employed by the Company in relation to a textile undertaking, shall become, on and from the appointed day, an employee of the National Textile Corporation and shad hold office or service in that Corporation with the same rights and privileges as to pension, gratuity and other like matters as would have been admissible to him if the rights in relation to such textile undertaking had not been transferred to, and vested in, the National Textile Corporation, and shall continue to do so unless and until his employment in that Corporation is duly terminated or until his remuneration, terms and conditions of employment are duly altered by that Corporation.". "18. Every person having a claim against the Company in relation to the textile undertakings with regard to any of the matters specified in the Schedule shall prefer such claim before the Commissioner within thirty days from the specified date." "25. "18. Every person having a claim against the Company in relation to the textile undertakings with regard to any of the matters specified in the Schedule shall prefer such claim before the Commissioner within thirty days from the specified date." "25. (1) where any liability of the Company in relation to any textile undertaking arising out of any item specified in part 1 of the Schedule is not discharged fully by the Commissioner out of the amounts paid to him under this Ordinance, the Commissioner shall intimate in writing to the Central Government the extent of the liability which remains undischarged and that liability shall be assumed by the Central Government." A perusal of the aforesaid previsions of the Acquisition Ordinance/Act makes it clear that every employee of the Company in relation to acquired Textile undertakings became the employee of the National Textile Corporation with the same rights and privileges as to pension, gratuity and other like matters as would have been admissible to them if the rights in relation to such Textile Corporation/Undertakings had not been transferred to and vested in, the National Textile Corporation and they arc entitled to continue to have these rights unless and until their employment in the corporation is duly terminated or until the terms and conditions of the employment are duly altered by the Corporation. A reading of Section 5 of the Act along with Sections 18 and 25 of the Acquisition Ordinance/Act further makes it abundantly clear that every person having a claim against the Company in relation to Textile Undertakings with regard to any of the matters specified in the schedule shall prefer such claim before the Commissioner but if his claim is not satisfied out of the compensation money, then to the extent of undischarged liability the Central Government and for that purpose, the National Textile Corporation, shall assume the liability and there-fore it cannot be accepted that the Central Government/National Textile Corporation can in no case be proceeded against for the enforcement of the liability in respect of a period prior to the appointed day. The points urged by the learned Counsel for the petitioner have no relevance to the question as to the validity or otherwise of the Award and also having regard to the fact that they have also not been taken in the writ petition. The points urged by the learned Counsel for the petitioner have no relevance to the question as to the validity or otherwise of the Award and also having regard to the fact that they have also not been taken in the writ petition. This is a question which may arise at the time of enforcement of the Award. However, as noticed above, the National Textile Corporation seems to be very well represented before the Tribunal and if so advised, may raise the points at the time of Execution proceedings when the Award is sought to be executed. 13. From the above discussion, I find no substance in this contention also urged before me and on this score also the petition is liable to be dismissed. 14. The writ petition is liable to be dismissed on yet another ground i. e. on the ground of laches resulting from the petition having been filed beyond time by one year and 329 days. The impugned award was made on 1-12-1987 and published on 14-3-88. The writ petition was filed on 22-2-90. The delay in filing the writ petition is sought to be explained away in the following words : "21. That after the publication of the Award the case file was sent to Head Office, alongwith a letter for approval to challenge the award. The case file was sent in April, 1988, but the same was lost in transit and after holding due enquiry at the Mills and at the Head Office, the petitioner again applied for certified copies of different documents and after obtaining the same has preferred this writ petition." 15. This Court had directed the petitioner on 22-2-90 to file a supplementary affidavit explaining the delay in detail. The supplementary affidavit filed by the petitioner alongwith an application dated nil presented on 29-3-90 for condonation of delay does not place the case on a better footing in as much as 1 am not satisfied with the explanation given in paras 5, 6, 7 and 8 of the supplementary affidavit which is an unsuccessful attempt at explaining away the laches in filing the writ petition beyond the period of limitation. The award is dated 1st December 1987 having been published in the Gazette on 14th March, 1988. The award is dated 1st December 1987 having been published in the Gazette on 14th March, 1988. it is averred in para 5 of the supplementary affidavit that if the workmen asked the Management to implement the award, an enquiry was set up and a Senior Administrative Officer directed the conducting officer to produce all the relevant file through letter dated 11th September, 1989. In subsequent paragraphs of the supplementary affidavit, it is averred that some enquiry was held and it was found that the file of the case was missing and therefore a duplicate file was prepared from the record of the Industrial Tribunal and after preparation of the file, papers were made over to the Counsel in January, 1991 for filing the writ petition. The laches prior to September 1989, have not been explained at all. As such, the petition is liable to be dismissed on the grounds of laches also. 16. In the result, the petition fails and is dismissed accordingly, parties to bear their own costs.