Mahabir Prosad Choudhury v. Octavius Tea and Industries Ltd.
2009-12-23
ASHIM KUMAR BANERJEE, KALIDAS MUKHERJEE
body2009
DigiLaw.ai
Judgment : ASHIM KUMAR BANERJEE, J. (1.) Backdrop: 1.1 The appellant was a permanent employee of the respondent No. 1. He was terminated from service with effect from May 2, 2005. There had been a change of management in the year 2004. However, the employer assured the employees that the service conditions of the employees of the respondent No. 1 would not be affected by such change. Appellant raised an industrial dispute before the Labour Commissioner which was ultimately referred to the Tribunal to decide as to whether refusal of employment to the appellant by the management with effect from May 2, 2005 was justified. According to the appellant, the Tribunal issued necessary order for service of notice upon the respondent company and notice was served through process server. The respondent No. 1 however denied such assertion as according to them, they were never served with any notice of such reference being pending before the Tribunal. 1.2 The Tribunal passed an ex-parte award directing reinstatement of the appellant with full back wages. When the appellant insisted on his re-instatement on the strength of the award the company made an application before the Tribunal inter alia, praying for setting aside of the ex-parte award on the ground that no notice was served upon the respondent company. The Tribunal upon hearing the rival contentions rejected the said application vide order dated September 30, 2008 appearing at pages 114-120 of the application for stay which was treated as paper book pursuant to the order of the Division Bench passed earlier. 1.3 The Tribunal was of the view that it did not have competence to recall and/or set aside the award as they became functus officio after expiry of thirty days from the date of publication of the award. The Tribunal, however, before making such order, observed that notice was not served upon the respondent No. 1. (2.) Writ Proceeding : Being aggrieved, the respondent No.1 approached the learned Single Judge by filing the writ petition when His Lordship allowed the writ petition and set aside the award and revived the order of reference with a direction upon the Tribunal to hear the parties afresh. (3.) This Appeal : Being aggrieved by the order of the learned single Judge, the appellant preferred the instant appeal. We heard the parties at length.
(3.) This Appeal : Being aggrieved by the order of the learned single Judge, the appellant preferred the instant appeal. We heard the parties at length. (4.) Contention Of The Appellant : i) The learned Single Judge failed to appreciate that attempt was made to serve the respondent No. 1 who deliberately avoided appearance before the Tribunal. ii) The Tribunal was satisfied that the service was affected through process server and such satisfaction was duly recorded in the order dated October 11, 2007. Hence, it was obligatory on the part of the company to appear before the Tribunal. The Tribunal tried to make over the written statement to the company who did not make them available through authorized representative to accept service of the written statement as would appear from the order dated November 29, 2007. iii) Once the Tribunal was satisfied that the service was effected upon the employer Tribunal was entitled to proceed ex-parte in case the employer did not turn up. iv) Assuming but not admitting, there had been irregularity in service of notice or copy of the written statement the Tribunal had become functus officio on the expiry of thirty days in view of the provisions of the Industrial Dispute Act, 1947 and the West Bengal Industrial Disputes Rules, 1958. (5.) Contention of the Respondent Company:-i) Since the notice was not served by the company and the same was accepted by the Tribunal and such fact accepted by the Tribunal as would appear from the order dated September 30, 2008 the Tribunal should have recalled and/or set aside the award directing the proceeding to start de novo. The learned Single Judge was right in directing so. ii) Section 17A of the said Act of 1947 did not create any fetter on the Tribunal from recalling its ex-parte award and directing proceeding to start de novo. iii) Rule 27 of the said Rules of 1958 empowered the Tribunal to set aside ex-parte award on sufficient cause. (6.) Decisions Cited : The parties cited the following decisions : i) Travancore Rubber Works Employees Union vs. Industrial Tribunal, Trivandrum and Ors., reported in 1962 (1) Labour Law Journal, Page-478. ii) The Management of Associated Transport (Madras) Private Limited vs. S. Sambandam and Anr., reported in 1970 Labour and Industrial Cases.
(6.) Decisions Cited : The parties cited the following decisions : i) Travancore Rubber Works Employees Union vs. Industrial Tribunal, Trivandrum and Ors., reported in 1962 (1) Labour Law Journal, Page-478. ii) The Management of Associated Transport (Madras) Private Limited vs. S. Sambandam and Anr., reported in 1970 Labour and Industrial Cases. Page-900 (Volume-III, C.N. 194) iii) Grindlays Bank Limited vs. Central Government Industries Tribunal and Ors., reported in 1981 Labour Law Journal, Page327. iv) Anil Sood vs. Presiding Officer, Labour Court-II, reported in 2001(10) Supreme Court Cases, Page-534. v) Sangham Tape Company vs. Hans Raj, reported in 2005(9) Supreme Court Cases, Page-331. vi) Radhakrishna Mani Tripathi vs. L.H. Patel and Anr., reported in 2009(11) Supreme Court Cases, Page-81. (7.) Our View : 7.1 We have carefully perused the order of the Tribunal rejecting the application for setting aside the award. The Tribunal, in its decision, elaborately considered not only the rival contentions of the parties but also the records of the Tribunal and then came to a finding that the notice under Rule 21 of the said Rules of 1958 had not been served upon the company before fixing the date for hearing the case ex -parte. 7.2 The Tribunal also held that copy of the written statement had not been served upon the company in terms of Rule 20B(5) of the said Rules of 1958. The relevant extract of the Tribunals finding is quoted below : "Herein our case, it is apparent that the ex- parte award was passed on 26.02.08. Facts remain that the notice under Rule 21 of the West Bengal Industrial Disputes Rules, 1958 has not been served upon the company before fixing the date for hearing the case ex-parte. It is also fact that the workman filed written statement in this case but the copy of the written statement has not been served upon the company in compliance with the provision of Rule 20B(5) of the West Bengal Industrial Disputes Rules, 1958." 7.3 From the observations quoted (supra) it was clear that the Tribunal was satisfied that there had been sufficient cause for recall of the said award. The Tribunal however rejected the prayer on the ground that it had no jurisdiction as it had become functus officio after expiry of thirty days of publishing the award. The Tribunal relied on the Apex Court decision in the case of Sangham Tape Company (supra).
The Tribunal however rejected the prayer on the ground that it had no jurisdiction as it had become functus officio after expiry of thirty days of publishing the award. The Tribunal relied on the Apex Court decision in the case of Sangham Tape Company (supra). The Tribunal however did not have the benefit of the later decision in the case of Radhakrishna Mani Tripathi (supra). 7.4 The relevant provisions of the Act and the Rules referred to above have already been interpreted by the Apex Court in the case of Sangham Tape Company (supra) and Radhakrishna Mani Tripathi (supra). Our task has thus become easier. We have to understand the ratio decided in the said two decisions and apply the same in the present case as far as practicable. 7.5 Let us first find out whether facts are identical or not. In the instant case, the Tribunal earlier recorded that the service was done through process server, although, Tribunal did not specifically comment on such issue despite a specific challenge thrown by the company in their application that they were never served with any notice. The Tribunal categorically held that there was no notice under Rule 21 before proceeding ex-parte. The Rule 21 says if, without sufficient cause, being shown any party to a proceeding before the Tribunal fails to attend the Tribunal may proceed as if such party has been duly represented. Hence, a notice should have been given asking the employer to show cause why they failed to attend, such notice was not given. The Tribunal also observed that the written statement was not served upon the company. In any event, on perusal of the detailed order of the Tribunal it appears to us that Tribunal was satisfied with the case made out by the employer for setting aside of the award. The Tribunal however expressed their inability in view of the decision in the case of Sangham Tape Company (supra). 7.6 In the case of Sangham Tape Company (supra) a complaint petition was filed by the workman through the Trade Union before the Labour Inspector that he was not being allowed to join his duty. Complaint was duly registered. A settlement was arrived at and a monetary compensation was received by the workman. Despite settlement, he filed a reference before the Labour Court claiming re-instatement with full back-wages.
Complaint was duly registered. A settlement was arrived at and a monetary compensation was received by the workman. Despite settlement, he filed a reference before the Labour Court claiming re-instatement with full back-wages. In this backdrop ex-parte award was passed by the Labour Court. The company, upon coming to know of the ex-parte award, moved an application for setting aside beyond thirty days. The Tribunal did not entertain. The High Court however set aside the order of the Tribunal. The matter went up to the Supreme Court. In these facts the Apex Court observed as follows:-"6. An industrial adjudication is governed by the provisions of the Industrial Disputes Act, 1947 (hereinafter referred to as "the Act") and the Rules framed thereunder. The Rules framed under the Act may provide for applicability of the provisions of the Code of Civil Procedure. Once the provisions of the Code of Civil Procedure are made applicable to the industrial adjudication, indisputably the provisions of Order 9 Rule 13 thereof would be attracted. But unlike an ordinary Civil Court, the Industrial Tribunals and the Labour Courts have limited jurisdiction in that behalf. An award made by an Industrial Court becomes enforceable under section 17A of the Act on the expiry of 30 days from the date of its publication. Once the award becomes enforceable, the Industrial Tribunal and/or Labour Court becomes functus officio. 8. The said decision is, therefore, an authority for the proposition that while an Industrial Court will have jurisdiction to set aside an ex-parte award, but having regard to the provision contained in section 17A of the Act, an application therefor must be filed before the expiry of 30 days from the publication thereof. Till then the Tribunal retains jurisdiction over the dispute referred to it for adjudication, and only up to that date, it has the power to entertain an application in connection with such dispute. 9. It is not in dispute that in the instant case, the High Court found as of fact that the application for setting aside the award was filed before the Labour Court after one month of the publication of the award. 12. This Court in Anil Sood did not lay down any law to the contrary. The contention raised on the part of Mr.
12. This Court in Anil Sood did not lay down any law to the contrary. The contention raised on the part of Mr. Jain in the effect that in fact in that case an application for setting aside an award was made long after 30 days cannot be accepted for more than one reason. Firstly, a fact situation obtaining in one case cannot be said to be a precedent for another. (See Mehboob Dawood Shaikh vs. State of Maharashtra). Secondly, from a perusal of the said decision, it does not appear that any date of publication of the award was mentioned therein so as to establish that even on fact, the application was made 30 days after the expiry of publication of the award. Furthermore, the said decision appears to have been rendered on concession." 7.7 On perusal of the paragraphs quoted (supra) our understanding is that the Apex Court was of the view in the said case that the Industrial Tribunal or the Labour Court as the case may be, had limited jurisdiction and did not have same power as Civil Court had under Order 9, Rule 13 of the Code of Civil Procedure. The Apex Court held that an Industrial Court became functus officio beyond thirty days because of the clear mandate of section 17A of the said Act of 1947. Facts involved in our case has almost a complete resemblance with the facts involved in Sangham Tape Company (supra). The Tribunal on that score possibly did not commit any illegality as the said decision was squarely binding upon them. The situation is somewhat different before us in view of pronouncement of later decision of the Apex Court in the case of Radhakrishna Mani Tripathi (supra). In this decision we find that the employer approached the Labour Court for recall of an ex-parte award on the ground that no notice had been served and the applicant only came to know of the ex-parte award only on the day before making of the application. The facts are almost identical. Paragraphs 10, 11, 14, 15, 16, 17 and 18 being relevant herein are quoted below : "10. However, Ms. Issar, learned Counsel appearing for the appellant tried to question the validity of Rule 26(2) itself.
The facts are almost identical. Paragraphs 10, 11, 14, 15, 16, 17 and 18 being relevant herein are quoted below : "10. However, Ms. Issar, learned Counsel appearing for the appellant tried to question the validity of Rule 26(2) itself. She submitted that under section 17A of the Act an award becomes enforceable on expiry of thirty days from the date of its publication whereupon the Labour Court is rendered functus officio. Hence, any application for recall could only be made within thirty days from the date of publication of the award, otherwise it would not be open to the Labour Court to entertain it, as the matter would have gone completely beyond its authority. In support of the submission she relied upon certain observations in the decision in Grindlays Bank Ltd. vs. Central Govt. Industrial Tribunal. She further submitted that the provision of Rule 26(2) of the Bombay Rules was in derogation of section 17A of the Act insofar as it extended the time for making an application for recall of the award and stretched it to a point where the Labour Court ceased to have any control or authority over the matter. Learned Counsel submitted that Rule 26(2) of the Bombay Rules was in conflict with section 17A of the Act and tended to supplement it. The provision of the Rule must, therefore, be held to be invalid and inoperative. In support of the submission she relied upon a number of decisions which it is not necessary to mention here. 11. We are unable to accept the submissions made on behalf of the appellant and we think any reliance placed on the decision in Grindlays Bank is quite misplaced. In Grindlays Bank an order passed by the Labour Court, recalling its award, was assailed on the same lines as advocated by Ms. Issar before us. In view of the submissions made before it in that case the Court framed the second question arising for its consideration as follows: (SCCp.422, para 3) "3...... whether the Tribunal became functus officio on the expiry of 30 days from the date of publication of the ex parte award under section 17, by reason of sub-section (3) of section 20 and, therefore, had no jurisdiction to set aside the award and the Central Government alone had the power under sub-section (1) of section 17A to set it aside." 14.
In Grindlays Bank this Court held that Rules 22 and 24(b) were sufficiently the source of power for the Industrial Courts to recall an ex-parte award. It was pointed out that in terms of Rule 22 the Industrial Courts could proceed ex-parte in the matter only in case a party to the proceeding failed to attend or be represented without showing sufficient cause. The Court held that power to proceed ex-parte under Rule 22 carried with it the power to inquire whether or not there was sufficient cause for the absence of the party at the hearing and in case the party was able to show sufficient cause for its non-appearance on the date the Court had proceeded ex- parte against it, to recall the award. 15. Similarly, the Court pointed out in Grindlays Bank, the provision of Rule 24(b) empowered the Industrial Courts to refuse to adjourn the hearing and to proceed ex-parte. Hence, in a case in which the Industrial Court makes an ex-parte award the provisions of Order 9 Rule 13 CPC would be clearly attracted. It logically follows that the Tribunal is competent to entertain an application to set aside an ex-parte award. The Court thus founded the Industrial Courts jurisdiction and power to recall an ex-parte award on Rules 22 and 24(b) of the Central Rules. It is thus to be seen that in Grindlays Bank what this Court held to be implicit in Rule 22 of the Central Rules is made explicit and clear in the Bombay Rules in the form of sub-rule (2) of Rule 26. 16. Coming now to the submission based on section 17A of the Act the Court in para 14 of the decision held and observed as follows: (Grindlays Bank case, SCC pp. 425-26) "14. The contention that the Tribunal had become functus officio and, therefore, had no jurisdiction to set aside the ex-parte award and that the Central Government alone could set it aside, does not commend to us. Sub-section (3) of section 20 of the Act provides that the proceedings before the Tribunal would be deemed to continue till the date on which the award becomes enforceable under section 17A. Under section 7A of the Act, an award becomes enforceable on the expiry of 30 days from the date of its publication under section 17.
Sub-section (3) of section 20 of the Act provides that the proceedings before the Tribunal would be deemed to continue till the date on which the award becomes enforceable under section 17A. Under section 7A of the Act, an award becomes enforceable on the expiry of 30 days from the date of its publication under section 17. The proceedings with regard to a reference under section 10 of the Act are, therefore, not deemed to be concluded until the expiry of 30 days from the publication of the award. Till then the Tribunal retains jurisdiction over the dispute referred to it for adjudication and up to that date it has the power to entertain an application in connection with such dispute." That stage is not reached till the award becomes enforceable under section 17A. In the instant case, the Tribunal made the ex- parte award on 9.12.1976. That award was published by the Central Government in the Gazette of India dated 25.12.1976. The application for setting aside the ex-parte award was filed by Respondent 3, acting on behalf of Respondents 5 to 17 on 19.1.1977 ie. before the expiry of 30 days of its publication and was, therefore, rightly entertained by the Tribunal. It had jurisdiction to entertain it and decide it on merits. From the above quotation it would appear that in Grindlays Bank the recall application was filed within thirty days from the date of publication of the award and hence, the objection raised on the basis of section 17A did not arise in this case. In Grindlays Bank this Court did not say that the Industrial Courts would have no jurisdiction to entertain an application for setting aside an award made after thirty days of its publication. Nevertheless, on the basis of the passage marked in italics in the above quotation Ms Issar strongly contended that that is the true import of the judgment: 17. We are unable to accept. The position is made clear in the later decision in Anil Sood vs. Labour Court. In Anil Sood interestingly the Labour Court had rejected the recall application on the very same ground that after making the award it became functus officio in the matter. The order of the Labour Court was challenged before the High Court but the High Court also took the same view.
In Anil Sood interestingly the Labour Court had rejected the recall application on the very same ground that after making the award it became functus officio in the matter. The order of the Labour Court was challenged before the High Court but the High Court also took the same view. In appeal this Court noted that the award was made on 11.9.1995 and the application for its recall was filed on 6.11.1995. The Court referred to the earlier decision in Grindlays Bank and the provisions of sub-sections (1) and (3) of section 11 of the Act and in paras 6, 7 and 8 of the decision observed and held as follows: (Anil Sood case, SCC p. 536) 6. The aspect that the party against whom award is to be made due opportunity to defend has to be given is a matter of procedure and not that of power in the sense in which the language is adopted in section 11. When matters are referred to the Tribunal or Court they have to be decided objectively and the Tribunals/Courts have to exercise their discretion in a judicial manner without arbitrariness by following the general principles of law and rules of natural justice. 7. The power to proceed ex-parte is available under Rule 22 of the Central Rules which also includes the power to inquire whether or not there was sufficient cause for the absence of a party at the hearing, and if there is sufficient cause shown which prevented a party from appearing, then if the party is visited with an award without a notice which is a nullity and therefore the Tribunal will have no jurisdiction to proceed and consequently, it must necessarily have power to set aside the ex-parte award. 8. If this be the position in law, both the High Court and the Tribunal (Sic Labour Court) fell into an error in stating that the Labour Court had become functus officio after making the award though ex-parte. We set aside the order made and the award passed by the Labour Court and affirmed by the High Court in this regard, in view of the fact that the learned Counsel for the respondent conceded that application filed by the appellant be allowed, set aside the ex-parte award and restore the reference. 18.
We set aside the order made and the award passed by the Labour Court and affirmed by the High Court in this regard, in view of the fact that the learned Counsel for the respondent conceded that application filed by the appellant be allowed, set aside the ex-parte award and restore the reference. 18. In light of the decision in Anil Sood we find no substance in the appellants submission based on section 17A of the Act. There being no substance in the first limb of the submission there is no question of any conflict between Rule 26(2) of the Bombay Rules and section 17A of the Act." 7.8 On perusal of the said decision it appears that the Apex Court did not consider the decision in the case of Sangham Tape Company (supra). Their Lordships however considered the earlier decisions in the case of Anil Sood (supra) and Grindlays Bank Limited (supra). Those two decisions were also considered by Sangham Tape Company (supra). The decision in the case of Radhakrishna Mani Tripathi (supra) having equal force heavily relied on its earlier decision in the case of Anil Sood (supra) and Grindlays Bank Limited (supra) which were distinguished by Sangham Tape Company (supra). However, on the identical facts the Apex Court observed that Rules 22 and 24b were sufficient to recall an ex-parte award by the Tribunal. The Apex Court relied on its earlier observation in Grindlays Bank Limited (supra) that such power was implicit in Rule 22 which was made explicit in Rule 26(iii) of the Bombay Rules which is almost identical to our West Bengal Rules being Rule 27(iii). 7.9 We may view the present problem from another angle. Whatever might be the reason, the Tribunal observed that they could not recall the ex-parte award as it became functus officio. Such observation was made by the Tribunal after being satisfied that no notice was issued before the ex-parte hearing. No copy of the written statement was served upon the company. No challenge was thrown to such observations by the workman at any point of time, at least we do not find any such challenge anywhere. So we are only concerned whether the Tribunal had power beyond thirty days to recall its award on sufficient ground.
No copy of the written statement was served upon the company. No challenge was thrown to such observations by the workman at any point of time, at least we do not find any such challenge anywhere. So we are only concerned whether the Tribunal had power beyond thirty days to recall its award on sufficient ground. Anil Sood (supra) categorically held that the power to proceed ex-parte is available under Rule 22 of the Central Rules which included the power to inquire whether or not there was sufficient cause for the absence of a party at the hearing. If sufficient cause was shown which prevented a party from appearing and the party was visited with an award without a notice said award would be a nullity and the Tribunal would have no jurisdiction to proceed further and consequently, it must necessarily have power to set aside the ex-parte award. Identical view was taken by the latest decision by the Apex Court in the case of Radhakrishna Mani Tripathi (supra). Such observation was made on the identical facts. Hence, the learned Judge was right in asking the Tribunal to hear the proceeding de novo. We do not find any scope of disagreement on that score. (8.) Result : The appeal fails and is, hereby, dismissed. There would be no order as to costs. Appeal dismissed.