Escorts Mahle Now M/s Federal Mogul Goetze India Ltd. Bahadurgarh, Patiala v. State Of Punjab And Others
2009-08-17
K.KANNAN
body2009
DigiLaw.ai
Judgment K.Kannan, J. 1. The writ petition challenges the reference made by the Labour Commissioner, Punjab which reads as follows :- "Whether after entering into a settlement under Section 2 (p) of the Industrial Dispute Act, 1947 dated 26.11.1999 with the workman Sh. Mohan Lal by the Management, his services has been terminated in an unjustified and illegal manner ? If yes then the workman is entitled to what relief and to what extent ?" The challenge is on the ground that the reference itself makes the reference to the settlement executed on 26.11.1999 and the terms of the settlement recites the fact that instead of termination of service, the workman was bargaining for an early retirement to enable him to claim amounts which were due to him under various heads, which benefit he would not have obtained if it had been a case of dismissal from service . The contention of the learned counsel for the petitioner is that under the terms of the settlement the workman had received Rs. 3,90,054.96 besides gratuity and Provident Fund. The reference according to him is bad on three grounds. i) There had been a settlement entered into between the parties under Section 12 (3), before the Conciliation officer and it had an effect of an award under Section 18(1) and 19. There was no scope for a reference by the State. Secondly, the reference itself makes recital regarding the settlement and therefore, an adjudication whether termination should be said to be justified or not was self defeating the purpose of settlement for, if there was a settlement there was no question of an adjudication regarding the alleged illegality of the termination. Thirdly he had been, a party to the settlement which was affected on 26.11.1999 and he had been no longer in service; and reference which was made in the year 2008 was grossly belated. 2. In support of his contentions, learned counsel for the petitioner relies on National Engineering Industries Ltd. v. State of Rajasthan and others, 2000(1) SCT 717 : (2000)1 SCC 371 which dealt with the case of the nature and effect of the settlement brought about through a conciliation process. There is a presumption that such a settlement is just and fair.
In support of his contentions, learned counsel for the petitioner relies on National Engineering Industries Ltd. v. State of Rajasthan and others, 2000(1) SCT 717 : (2000)1 SCC 371 which dealt with the case of the nature and effect of the settlement brought about through a conciliation process. There is a presumption that such a settlement is just and fair. The Honble Supreme Court also referred to the fact that if the settlement was not bona fide or the same was arrived at on account of fraud, misrepresentation, concealment of facts or corruption or other inducement it would be a matter of further industrial dispute referable under Section 10 of the Industrial Disputes Act, 1947 . The reliance of this judgment by the learned counsel for the petitioner was to bring support to the contention that the reference did not make any recital about the settlement itself as having been challenged and even the demand notice that had been issued prior to the settlement did not make any reference to the settlement as having been brought under any vitiating circumstances. On the other hand, it was a case where the benefit under the settlement had been obtained and even in the written statement filed before this Court the receipt of the amount was admitted by the workman and his contention was that he utilized the funds for his immediate personal needs. 3. Learned counsel for the petitioner also makes reliance on a judgment of Honble Supreme Court in Barauni Refinery Pragatisheel v. Indian Oil Corporation Limited (1991) 1 SCC 4 where it again held that there was a "presumption regarding a settlement under Section 2 (b) 18 (1) and (3) and binding on all workmen of the establishment, even those who belong to the minority union which had objected to the same. To that extent it departs from the ordinary law of contract. The object obviously is to uphold the sanctity of settlement reached with the active assistance of the Conciliation Officer and to discourage an individual employee or a minority union from scuttling the settlement. There is an underlying assumption that a settlement reached with the help of the Conciliation Officer must be fair and reasonable and can, therefore, safely be made binding not only on the workman belonging to the union signing the settlement but also on the others.
There is an underlying assumption that a settlement reached with the help of the Conciliation Officer must be fair and reasonable and can, therefore, safely be made binding not only on the workman belonging to the union signing the settlement but also on the others. That is why a settlement arrived at in the course of conciliation proceedings is put on par with award made by an adjudicatory authority." 4. Learned counsel appearing on behalf of the workman responds, contending that this issue has been squarely covered by the judgment in Escorts Mahle Limited v. State of Punjab and others, 2003(1) SCT 346 : 2002(8) SLR 721. It was again a case where a reference has been made under the terms on which the workman contended his termination of service was bad . The judgment does not really give out the actual terms of reference in any portion of the judgment but it is seen from the evidence discussed in the judgment that the Management was contending that some amounts had been paid under the settlement and the amounts had also been received by the workman. The workmans plea was that some blank papers had been obtained by the Management with his signatures and they had been put to service for filling up recitals as though a voluntary retirement had been made. The terms of the demand notice which had been served on the workman is also not stated any where in the judgment and it is not clear whether there had been any reference about the settlement in notice. Learned counsel appearing for the workman contends that even in a case where amount had been received by the workman the Honble Bench of this Court held that appropriate Government would be competent to examine whether the Industrial dispute at all existed or not. This jurisdiction of the Labour Court, the Court held, has to be exercised for adjudicating the contentions issue arising in the case. The appropriate Government hardly had vested with a jurisdiction to determine whether a fraud had been practised or there existed a situation which invalidated the settlement on grounds of coercion or misrepresentation while exercising powers under Section 12 (i) of the Industrial Disputes Act.
The appropriate Government hardly had vested with a jurisdiction to determine whether a fraud had been practised or there existed a situation which invalidated the settlement on grounds of coercion or misrepresentation while exercising powers under Section 12 (i) of the Industrial Disputes Act. A controversial issue that arose for consideration in the case, in the view of the Division Bench of this Court, required oral and documentary evidence and if the appropriate Government in its wisdom considered it appropriate to refer the matter to the Labour court for determination, the decision so exercised by the Government shall not put in jurisdiction before this Court. If the reference itself is that the settlement brought about by the Management was fraudulent or if in the demand notice it had been stated any where that the settlement had been brought out by fraud coercion or any other vitiating circumstance, it shall definitely be taken as a case where the Government cannot adjudicate on such issues. It shall always be left only to the Labour court to consider the same. In the case at hand, the reference makes a recital to the settlement and in the settlement the workman was only bargaining for a treatment of his dismissal as one for pre- mature retirement and that further pursuant to the settlement a monetary benefit had also been obtained which amount he had admittedly applied for his pressing needs. There is hardly a scope for any adjudication before the Labour Court. If there was a fraud, law does not allow a person who complains of fraud to come at any time, the time he wished. The purported fraud was of the year 1999 and the reference was made in the year 2008. While normally rules of limitation will not fetter a Government to intervene on behalf of the workman, in a case of fraud it shall be expected that definite pleadings are made to sustain such a contention. When no whisper had been made by the workman in the demand about the so called fraud, it shall absolutely be a judicial waste of time for a Labour Court to be exercising its jurisdiction on an issue which is not a matter of reference. If there was a fraud, it should have been mentioned even in the reference. The adjudication must have been whether the alleged settlement was true or not.
If there was a fraud, it should have been mentioned even in the reference. The adjudication must have been whether the alleged settlement was true or not. On the other hand, I have extracted the terms of reference itself which takes the settlement as in existence and seeks for an adjudication whether the termination of service was justified or not. The adjudication relating to termination is really absurd and otiose in a case where the settlement contemplated the termination of service as voluntary retirement and payment or retiral benefits. 5. Learned counsel appearing for the workman contends that the settlement makes a reference to payment of retiral benefits like gratuity and Provident Fund. According to him, no amount has been paid. The so called receipt which the Management relied on, for alleged payment of cash of Rs. 75,105/- is a fabrication and the amount has never been paid. Curiously, the amount is alleged to have been paid in cash but even the issue whether the payment had been made could not be adjudicated by the workman in any manner than how the law would allow him to adjudicate on. If the settlement terms referred to gratuity or Provident Fund and if such amounts had not come to the workman, he shall have the remedy under the relevant provisions of Payment of Gratuity Act and Provident Fund Act. The alleged non-payment itself of gratuity or provident fund cannot vitiate a settlement. 6. The decision of the Division Bench of this Honble Court in Escorts Mahle Limiteds case (supra) shall rest on the peculiar facts which the case was considering at para 9 of the judgment. The Division Bench held as follows :- " Once admittedly, there is a settlement executed between the parties, which itself is not in question, in that event, the provisions of Section 18(1) read with Section 2 (p) of the Act would operate as an impediment to the jurisdiction of the appropriate Government to make a reference under Section 10(1)(c) of the Act. This cannot be an absolute proposition of law applicable uniformly to all cases. The principle has to be applied on the facts and circumstances of each case. The reliance placed by the learned counsel for the petitioner in the case of Sirpur Paper Mills Limited and other cases, there cannot be any dispute to the proposition of law.
This cannot be an absolute proposition of law applicable uniformly to all cases. The principle has to be applied on the facts and circumstances of each case. The reliance placed by the learned counsel for the petitioner in the case of Sirpur Paper Mills Limited and other cases, there cannot be any dispute to the proposition of law. In these cases, there was hardly any dispute with regard to execution of the settlement and allegations of coercion or fraud were not made in those cases. The question was whether the Government could go into the question of bona fides of a settlement which was binding under Section 18(1) of the Act and, in all these cases, settlements were executed after dispute had arisen between the parties. The learned counsel for the petitioner has not been able to demonstrate before us as to where was the occasion for the Management to execute a settlement with the workman so as to execute an agreement under Section 18 (1) of the Act. The allegations and counter-allegations made and conduct of either of the parties before us is sought which would require proper adjudication of rival contentions upon recording of detailed documentary and oral evidence. Such a function certainly falls outside the ambit of the appropriate Government while exercising its powers under Section 10(1)(c) of the Act. Undue weightage cannot be given to what is stated by the Conciliation Officer as, admittedly, the conciliation proceedings have failed. There was nothing before the Conciliation Officer to record such a finding. XX XX XX Certainly, the appropriate Government is competent to examine whether an industrial dispute at all existed or apprehended or not. This jurisdiction has `to be exercised without adjudicating the controversial issue arising in the case. The appropriate Government can hardly be vested with the jurisdiction to determine whether a fraud has been played or a document would stand invalidated on the ground of coercion or misrepresentation while exercising powers under Section 10(1)(c) of the Act." 7. The Division Bench really was considering a case where the settlement itself was specifically under challenge as having been brought about by fraud which fact could not have been decided by the Government for after all, an administrative authority can only put a contentions issue for consideration before a Court. In this case, the contention issued is a moon shine.
The Division Bench really was considering a case where the settlement itself was specifically under challenge as having been brought about by fraud which fact could not have been decided by the Government for after all, an administrative authority can only put a contentions issue for consideration before a Court. In this case, the contention issued is a moon shine. It is a contention raised only to keep the dispute alive. It is a cliched expression that even a bad settlement is better than a well considered judgment. A settlement invariably brings an end to a dispute. A settlement where parties had the benefit of active participation in the ultimate outcome shall normally endure at all times which an adversarial litigation through a Court process could never end. It also happens at times that even a settlement which is voluntarily entered gets to be a point for contention. There could be hard cases where the party did not apprise himself properly before entering into a settlement and therefore, a justification may exist for assailing the same. I do not find this case to be an instance of such an innocent person and or a person who was being mislead. A person that receives a sum in lacs in cash and who has put it to use finds after several years that money has dried, kicks up dust again for a fresh adjudication. It is as hard for litigants as are hard times for judiciary and even for the judicial system on the whole. The system is chocked by meaningless litigations and vexatious litigations generated by persons who have all the time in world to litigate. The Courts shall not be places where wasteful litigations are allowed to continue. The adjudication that had been sought is really on a non issue and allowing the reference to come through its full circle through an adjudication before the Labour Court shall be a meaningless waste of time. 8. The reference requires to be quashed for all the reasons outlined above and the writ petition is bound to succeed. However, the workman shall not be unnecessarily burdened with costs though, he deserves to be visited with costs in the hope that a decade that has gone past since he received a sum over 3 lacs has chastened him.