Bombay High Court
Digvijay Cement Company Ltd. vs State Of Maharashtra And Ors. on 12 February, 1986
Equivalent citations: [1986(52)FLR362], (1995)IIILLJ491BOM
JUDGMENT Pendse, J.
1. By this petition filed under Article 226 of the Constitution of India, the petitioner Company is challenging the legality of two orders passed by the State Government in exercise of powers under Section 10(i)(d) and under Sub-section (3) of Section 10 of the Industrial Disputes Act, 1947 (hereinafter referred to as the Act) The facts giving rise to the passing of these orders are as follows:
2. The petitioners are a Limited Company having their factory at Sewree, Bombay, and in which about 219 workers are employed. The workers are represented by respondent No. 3-Union. On January 12, 1985, the respondent No. 3 Union informed the Minister for Industries, Government of India, New Delhi, that the petitioner Company had number of factories in the country and one of the major Unit is at Sikka in Gujarat State and that Unit supplies raw materials for the manufacture of Cement to the Bombay factory. The Union pointed out that the Company is not being run to the full capacity and apprehended that the management may close down the Unit as the Company is diversifying the production in other Units. The Union pointed out that in case, the petitioner Company closed the Unit at Bombay, it would result in 300 workers rendering jobless. The copies of this communication were also sent to the Minister of Industries, Government of Maharashtra. Another letter was addressed on February 1, 1985 by the Union to the Minister for Labour, Government of Maharashtra, pointing out that the management had earlier settled the employees' long standing demands amicably and there is no existing labour problem, but inspite of that fact, the management is trying to close down the Unit step by step. The letter points out that the conduct of the management is not bona fide and the production is reduced with the idea of diversification of Unit to other places and the Government should look into the matter to protect the workmen.
3. In view of the grave concern caused by the said two letters, the Department of Labour, of the State Government took immediate action through the Office of the Commissioner of Labour, On February 2, 1985, the petitioner Company was requested to attend the Office of the Assistant Commissioner of Labour on February 6, 1985 in connection with the labour situation prevailing in the Company. The Legal Adviser of the Company attended the meeting and assured that the labour situation was absolutely normal and promised to enquire whether any trouble is apprehended in future. The Legal Adviser thereafter did not bother to give any information to the labour Commissioner. The Commissioner of Labour thereupon called a joint meeting of the representatives of the Union and the management of February 27, 1985, but the management remained absent. The Commissioner of Labour spoke over the telephone to the Works Manager of the petitioner Company and fixed another appointment for a joint conference. The Legal Adviser alone appeared on behalf of the Company and sought adjournment on the ground that responsible Officers of the Company are not available. Accordingly, the meeting was postponed to March 13, 1985.
4. The petitioner Company then suddenly published a notice of lock out on March 12, 1985 in accordance with the provision of Sub-section (2) of Section 24 of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act 1971. The lock out was to be effective from March 31, 1985. The Statement of Reasons annexed to the notice claims that the workmen resorted to go-slow tactics effective from February 21, 1985 and that has resulted into heavy losses. It further claims that the workmen were indulging in sabotage resulting into frequent break-downs of the machines and some of the workers had indulged in violence on or after February 21, 1981. The Company claimed that the work was suspended with effect from March 11, 1985.
On March 29, 1985, the Government of Maharashtra received a communication from the Regional Cement Controller expressing concern about suspension in production of cement at Sewree factory of the petitioner due to the alleged labour problems and requested the Government to intervene in the dispute and avoid loss of production. The Commissioner of Labour thereupon summoned the representatives of the parties but the Legal Adviser of the petitioners at the meeting justified the lock out. Another meeting was fixed on March 30, 1985 but the management remained absent. On April 6, 1985, the Minister of Labour made an attempt to conciliate between the parties and the management could not satisfy that the lock out was necessary. On April 23, 1985, the Union served a demand notice upon the company claiming wages for the period during lock out. The Company by its reply refused to concede the demand insisting that the lock out was justified. The Union thereafter submitted a justification statement in support of the demand against the petitioners.
5. In view of the Industrial unrest in the petitioner Company, the Office of the Commissioner of Labour made a proposal to the Government on April 11, 1985 recommending reference for adjudication under Section 10(1)(d) and suspension of operation of lock out. In view of the demands raised by the workmen and submission of justification statement, the State Government decided to refer the following dispute for adjudication to the Tribunal:
"Whether the suspension of operations and lock out effected in the Company's establishment with effect from 11th March, 1985 and 31st March 1985 respectively are justified? If not, what relief monetary or otherwise, the workmen are entitled to?"
On the same date, the Government passed another order in exercise of powers conferred by Sub-section (3) of Section 10 of the Act prohibiting the continuance of lock out in connection with the dispute referred to the Tribunal for adjudication/The Company had filed the present petition in this Court on June 21, 1985 challenging the two orders.
6. Shri Shelve, learned counsel appearing on behalf of the Company, raised three contentions in support or the petition. The first contention is that the reference made by the State Government is not valid because there was not any existing demand of the workmen on the date of reference. The submission is only required to be stated to be rejected. As mentioned hereinabove, the Company had declared a lock out, and prima facie, it appears to be without any reason whatsoever or with an ulterior motive, with effect from March 31, 1985, but the work was suspended from March 11, 1985 itself. The workers made demand for wages during the period of lock out, as it is the claim : of the Union that there was no justification whatsoever for suspending the work or declaring the lock out. The demand was lodged by the workmen on April 23, 1985 and the State Government after making several attempts to bring round the parties and realising the futility of the same because of the adamant attitude taken by the management decided to refer the dispute about justification of the action of suspension of work and lock out by the petitioner Company. It is difficult to appreciate how the action of the State Government can be faulted with. Shri Shetye faintly urged that the dispute could be referred provided it was in existence prior to the date of issue of lock out notice. The submission cannot be accepted because the action of declaring a lock out by the Company gave rise to the dispute and the demand made by the workmen that the lock out was unjustified and the workmen were entitled to the wages for the period of wrongful closure of the factory.
7. The second submission urged by the learned counsel is about the validity of the order of the State Government prohibiting the continuance of the lock out in connection with the dispute referred. It was urged by the learned counsel that the power conferred on the State Government under Sub-Section (3) of Section 10 of the Act enables the State Government to restrain the continuance of the strike or the lock out provided the cause which gave rise to the lock out is referred for adjudication to the Tribunal. It was urged that the cause which led the Company to declare lock out has not been referred for adjudication and, therefore, the exercise of power was defective. It is not possible to accede to the submission advanced by the learned counsel. Sub-section (3) of Section 10 of the Act reads as under:
"Where an industrial dispute has been referred to a Board, Labour Court, Tribunal or National Tribunal under this Section, the appropriate Government may by order prohibit the continuance of any strike or lock out in connection with such dispute which may be in existence on the date of the reference."
The plain reading of this Section makes it clear that the power could be exercised by the State Government, provided an industrial dispute has been referred to the Tribunal. The contention urged is that the lock out could be prohibited provided such lock out is in connection with the dispute which is referred. It was contended by Shri Shetye that the lock out was declared because of go-slow tactics and the violence resorted by the workmen and the question as to whether the workers indulged in such activities has not been referred and, therefore, the powers under Sub-section (3) were wrongly exercised. The submission is entirely misconceived. The dispute which is referred is in respect of the action of the petitioner Company in suspending the work and declaring the lock out and such dispute has a direct connection to the action of the petitioner Company and, therefore, the State Government had ample powers to prohibit the continuance of lock out.
8. The third contention urged by Shri Shetye is that before exercising power under Sub-section (3) of Section 10 of the Act, the State Government ought to have given hearing to the petitioner Company. It was urged that the order passed under Sub-section (3) of Section 10 of the Act is a quasi judicial order and even if considered to be an administrative order, demands that the party who is affected by such order is given a notice and hearing before-hand. It is not possible to accept the submission of the learned counsel. The powers conferred under this sub-section on the State Government are required to be exercised to maintain industrial peace and to avoid conflict between the employers and the employees. The order may be required to be passed in respect of industries which are essential or are of great importance to the public and it is futile to urge that in cases of emergency the State Government should give a show cause notice and hearing to the concerned parties before exercising the powers. Apart from this consideration, in the present case, it is very clear that the State Government, the Labour Commissioner and the Minister for Industries and Labour on several occasions called upon the petitioners to attend the meeting and find out a solution to the problem but the petitioner Company insisted in taking adamant attitude. Taking into consideration, the background which led to the issue of lock out notice by the Company, in my judgment the action of the State Government in prohibiting the continuance of lock out could not be faulted with. Shri Shetye invited my attention to the decision in the case of A.K. Kallappa Chettiar and Sons, Ernakulam (represented by its managing Partner, A.K. Karuppuswami), v. State of Kerala (represented by Chief Secretary to Government) and Ors. reported in 1970(1) Labour Law Journal 97 where the learned Single Judge of the Kerala High Court held that the power conferred under Section 10(3) of the Act could be exercised only after giving reasonable opportunity to the person who would be affected thereby. The Single Judge of the Kerala High Court also took the same view in the case of Malayalam Plantations (India) Limited and Anr. v. Workmen of Kaliyar Estate and Ors. reported in 1985 Indian Factories Journal, Volume 66, page 38.
9. Shri Deshmukh, learned counsel appearing on behalf of the Union, invited my attention to the Division Bench decision of the Andhra Pradesh High Court in the case of Eenadu Press Workers Union and Anr. v. The Government of A.P. and Anr. reported in 1979 Labour Industrial Cases 330 where it was held that it is not necessary to issue a show cause notice before exercising powers under Sub-section (3) of Section 10 of the Act. The Division Bench of the Andhra Pradesh High Court did not approve the decision of the Kerala High Court. I am in respectful agreement with the view taken by the Division Bench of the Andhra Pradesh High Court. Apart from that, in the present case, the State Government gave several opportunities to the petitioners and made it clear that the powers would be exercised if the petitioners declined to mend their ways. Reference was made also to decision of the Supreme Court in the case of Delhi Administration, Delhi v.
Workmen of Edward Keventers and Anr. reported in 1978 (2) LLJ 209 but that decision has no relevance to the submission that hearing should be given prior to the exercise of powers under Sub-section (3) of Section 10 of the Act. In my judgment, there is no merit whatsoever in the petition and the same deserves to be dismissed.
10. Accordingly, petition fails and the rule is discharged with costs. Shri Deshmukh very vehemently urged that the petitioner has approached the Court by making false statements and, therefore, the petition should not be entertained and compensatory costs should be awarded to the Union. I am not inclined to adopt the course suggested by the learned counsel.