Meghalaya High Court
North Eastern Electric Power vs . North Eastern Electric Power on 1 December, 2022
Author: H. S. Thangkhiew
Bench: H. S. Thangkhiew
Serial No. 01
Supplementary List
HIGH COURT OF MEGHALAYA
AT SHILLONG
WP(C) No. 367 of 2021
Date of Decision: 01.12.2022
North Eastern Electric Power Vs. North Eastern Electric Power
Corporation Ltd. (NEEPCO) Corporation Ltd. & Ors.
Workers Union & Ors.
Coram:
Hon'ble Mr. Justice H. S. Thangkhiew, Judge
Appearance:
For the Petitioner(s) : Mr. H.L. Shangreiso, Sr. Adv. with
Ms. A. Kharshiing, Adv.
For the Respondent(s) : Mr. V.K. Jindal, Sr. Adv. with
Mr. S. Jindal, Adv.
Mr. V. Kumar, Adv.
i) Whether approved for reporting in Yes/No
Law journals etc:
ii) Whether approved for publication Yes/No
in press:
JUDGMENT AND ORDER
1. The brief facts of the case are that the respondent Corporation NEEPCO by an office order dated 22.04.2021 in the Page 1 of 14 Conduct Discipline and Appeal Rules, 1980 governing all employees, had inserted Sub-Rule (iii) in Rule 8 of the said Rules which stipulated that no employees to whom the said Rules apply shall seek membership of any registered trade union or indulge in trade union activities.
The petitioners 1, 2 and 3 being the Employees Workers Union in the NEEPCO and its office bearers petitioners 4, 5 and 6, being aggrieved by the said amendment have assailed the same on the core ground that Rule 8 (iii) suppresses the fundamental rights of the petitioners guaranteed under the Constitution of India, and as such have prayed for setting aside and quashing the impugned Sub-Rule.
2. It has been argued on behalf of the petitioners by the learned Senior counsel Mr. H.L. Shangreiso that the Trade Unions Act, 1926, being a special law has inbuilt provisions regulating the purpose for formation, registration, membership, dis-membership of trade unions, not only for the workmen but for other employees in their positions as Executives or Supervisors engaged in an establishment or industry. He submits that it also encompasses non-employee and outsiders with some exceptions. The learned Senior counsel contends that those categories as provided under Section 22 (3) of the Trade Unions Act, 1926 can become members of trade union and also office bearers, and as such in NEEPCO, neither the Conduct Discipline and Page 2 of 14 Appeal Rules (CDA), Industrial Employment (Standing Orders), Act, 1946, or NEEPCO Standing Orders 1980, can prevent or take away the fundamental and legal rights of the petitioners. It is also submitted that the writ petitioners' association since their formation have been functioning well in coordination with the respondent NEEPCO and that it is not the case of the respondent, that the objectives or activities of the writ petitioners' association have now become contrary to law, to warrant the insertion of the impugned Sub-Rule. It is also contended that the Industrial Disputes Act, the Trade Unions Act and Standing Orders or for that matter any other statute, have any legal bar prohibiting non-workmen such as Supervisors, from being involved in trade union activities.
3. The learned Senior counsel then submits that the respondent NEEPCO, cannot seek to maintain that the impugned Sub- Rule is a reasonable classification, or restriction under Article 14 or Article 19 (4) of the Constitution, inasmuch as, the field is already covered by the Trade Unions Act, 1926 read with the Industrial Disputes Act, 1947. He further submits that the power vested in NEEPCO, is only to regulate their normal service conditions under the CDA Rules. It is also submitted that the NEEPCO through the impugned Sub-Rule, is incompetent to take away the membership, or Page 3 of 14 impede the formation of trade unions, which is guaranteed under Article 19 (1) (c) of the Constitution. He submits that the impugned Sub-Rule which confers sweeping unregulated and unrestricted powers upon the employees is arbitrary and unreasonable and against democratic values. In support of these arguments, the learned Senior counsel has relied upon the following judgments: -
i) O.K. Ghosh vs. E.X. Joseph reported in AIR 1963 SC 812 -
(Para 10 to 12)
ii) Smti Damyanti Naranga vs. Union of India (5B) reported in (1971) 1 SCC 678 - (Para 10)
iii) State of U.P. vs C.O.D Chheoki Employees Corporative Society Ltd. reported in (1997) 3 SCC 681 - (Para 6 and 16)
iv) Andhra Pradesh Dairy Development Corporation Federation vs. B Narasimha Reddy (2B) reported in (2011) 9 SCC 286 - (Para 21, 26 and 29)
v) Board of Control of Cricket vs. Cricket Association of Bihar reported in (2016) 9 SCC 286 - (Para 57 to 59)
vi) Bikajan Cement Corporation Employees Union vs. Cement Corporation of India Ltd. reported in (2004) 1 SCC 142 - (Para 13 to 17)
vii) SBI Staff Association vs. SBI (2B) reported in AIR 1996 SC 1685 - (Para-8)
viii) Tirumala Tirupiti Tivasthanam vs. Commission of Labour reported in (1995) Supp. 3 SCC 653 - (Para 3 and 4)
ix) Judgment and Order dated 28th Sept. 2001 passed by Karnataka High Court in the case of Government Tool Room and Training vs. Assistant Labour Commissioner - (Para- 2,6, 8 to 10) Page 4 of 14
x) Gulf Goans Hotels Company Ltd. vs. Union of India reported in (2014) 10 SCC 673 - (Para 25)
4. The learned Senior counsel submits that as the question of maintainability of the writ petition has also been raised, he contends that the instant writ petition has been filed by 3 trade unions along with 3 individual citizens who are employees of NEEPCO and office bearers and as such, there are is no bar to seeking remedy under Article 226. In this context, reference has also been made to the following decisions in support of his arguments:-
(i) State Trading Corporation of India Ltd. Vs. Commercial Tax Officer (5B) reported in AIR 1963 SC 1811- (Para 23)
(ii) Tata Engineering and Locomotive Company Ltd. Vs. State of Bihar (5B) reported in AIR 1965 SC 40 - (Para 26)
(iii) Rustom Gavasjee Copper vs. Union of India (9B) reported in (1970) 2 SCC 788 - (Para 10, 11, 12 & 15)
(iv) Bennet Coleman and Company vs. Union of India (5B) reported in (1972) 2 SCC 788- (Para 11-22 and 88 to 90)
(v) State of Gujarat vs. Ambica Mills Limited (5B) reported in (1974) 4 SCC 565- (Para 24 and 27)
(vi) Excel Wears vs. Union of India (5B) reported in (1978) 4 SCC 224- (Para 35)
(vii) Delhi Cloth and General Mills Company Ltd. Vs. Union of India (3B) reported in (1983) 4 SCC 166 - (Para 12) reported in (2016) 8 SCC 535 - (Para 57 to 59) Page 5 of 14 The learned Senior counsel concludes his submissions by praying that the impugned Sub-Rule be set aside and quashed for the ends of justice and equity.
5. The learned Senior counsel for the respondent Corporation, Mr. V.K. Jindal, has opened his submissions by submitting that though the respondent Corporation is a State within the meaning of 'other authorities' however it is not a statutory body, but a company registered under the Companies Act, 1956. The power to make bye laws he submits, is prescribed in Bye Law No. 96 of the Memorandum and Articles of Association of the company, which confers power upon the Board to make bye laws with regard to the conduct of business of the company, and as such the corporation can vary and amend such bye laws. Learned Senior counsel then submits that the position with regard to the status of the impugned provision, is no longer in dispute as both the parties herein, as submitted before the Division Bench of this Court, agree that these are not statutory rules. It is submitted that in exercise of this power, the Board of Directors formulated the NEEPCO CDA Rules, 1980 and under such vested powers had also incorporated Rule 8(iii). Mention is also made that the writ petitioners 1, 2 and 3 are trade unions and the petitioners No. 4, 5 and 6 in their individual capacity not being workmen, there is no violation of the petitioner's rights under Page 6 of 14 Article 19 (1) (c) or Article 14 of the Constitution of India. Learned Senior counsel further submits that the protection of Article 19 (1) (c) is not available to the petitioners' unions or to the petitioners No. 4, 5 and 6 as unions are not citizens, and though petitioners No. 4, 5, 6 may be citizens, however in this case Article 19 (1) (c) will not be applicable. Learned Senior counsel relies upon the judgment in the case of Board of Control for Cricket vs. Cricket Association of Bihar & Ors. reported in (2016) 8 SCC 535, wherein it has been held that Article 19 is available only to citizens and that once a union is formed, the right guaranteed under Article 19 (1) (c) comes to an end and there is no concomitant right to carry forward the aims and objectives of the union. Reference has also been made to a 5 Judge Bench judgment of the Hon'ble Supreme Court in the case of Tata Engineering and Locomotive Company Ltd. vs. State of Bihar reported in AIR 1965 SC 40 on the same point.
6. It was then argued by the learned Senior counsel, that there is a difference, of a right to form a trade union and a right to be member of a trade union and that these rights, are governed by statutory provisions such as under the Trade Unions Act, and only on fulfilling the necessary conditions can one become a member. He submits that the employees of the Corporation are categorized into two broad Page 7 of 14 categories, workmen who are governed by Standing orders and non- workmen who are governed by Bye Laws formulated by the respondent Corporation. It is also submitted that the impugned Rule 8 (iii), does not prohibit any of the non-workmen to form their own association or union, and get it registered under the Trade Unions Act. To substantiate these arguments, learned Senior counsel has illustrated the history of the workers' union in the NEEPCO and submits that initially the union consisted of only workmen, but by promotion and career growth, some workmen were promoted to the post of Supervisors and Executives, such as the petitioners No. 4, 5 and 6, but who however, continued to be members of the workers union. It is submitted that with the passage of time in 2017, the Federation of NEEPCO Employees Union which comprised of Workmen, Supervisors and few Executives was formed, but that besides this Union, other associations of non-workmen existed which were also registered under the Trade Unions Act. It is submitted that the membership of the said associations of non-workmen are governed by the NEEPCO CDA Rules, 1980 which is not applicable to workmen as defined under Section 2(s) of the Industrial Disputes Act, 1947. He therefore contends that since the CDA Rules, 1980 does not apply to workmen and the incorporation of Rule 8 (iii) also therefore Page 8 of 14 does not apply to them, the petitioners' trade union of workmen have no right to assail the validity of the Rule 8 (iii) of the CDA Rule.
7. Having heard learned counsel for the parties, the question that arises for consideration is whether Supervisory Officers and Managerial Staff, who are governed by the NEEPCO CDA Rules can no longer be part of trade unions in the Corporation or indulge in trade union activities. The writ petitioners 6 in all, consisting of 3 associations and 3 office bearers have assailed the insertion of Rule 8
(iii) in the said CDA Rules, which reads as follows: -
"Rule 8 (iii) Joining of Trade Union by Employees. No employees to whom this rule apply shall seek membership of any registered trade union or indulge in trade union activities"
8. Before coming to the main issue, the question of maintainability, has also been raised by the respondent Corporation on the main ground that the petitioners' union are not citizens, and though the petitioners No. 4, 5 and 6 are citizens, the protection of Article 19 (1) (c) is not available to them. This ground has been made on the basis that Article 19 (1) (c) guarantees the right to citizens to form associations and unions; and comes to end as soon as such union has formed. Though this contention is perhaps the correct position, as for as this aspect is concerned, however, the bigger picture in the instant case concerns the restrictions that had been imposed on the supervisory Page 9 of 14 staff who are governed by the CDA Rules, who by the insertion of Rule 8 (iii) are being divested of the membership which they have enjoyed hereinbefore.
9. The Trade Unions Act, 1926 is a Special Act and which provides for the registration of trade unions and a trade union regulates the relations between workmen or between employers. Who is a workman, has been defined in Section 2 (s) of the Industrial Disputes Act, and under the said definition, it includes all persons employed in trade or industry. Section 2 (s) (1) (2) (4), however, list the exceptions of persons in industry who are not considered workmen. Workmen in the respondent Corporation are not governed by the CDA Rules, but are governed by the approved Standing Orders formulated by the Corporation, under the provisions of the Industrial Employment (Standing Orders) Act, 1946, whereas non-workmen are governed by the CDA Rules. Therefore, as urged and shown by the respondent Corporation, it is clear that the petitioners No. 4, 5 and 6, though members of the petitioners 1, 2 and 3 trade unions, are governed by different Rules/Orders i.e. the CDA Rules. Though, there are no restrictions in forming trade unions or being a member thereof, in the present case in the considered view of this Court, the inclusion of Rule Page 10 of 14 8 (iii) is to be examined from the point of view as to whether it is a reasonable restriction.
10. It is noted that within the Corporation itself, there exists other associations of non-workmen, such as Diploma Engineers Association, Association of Engineers, which are also registered under the Trade Unions Act, and the members of the said associations of non- workmen are governed by the NEEPCO CDA Rules. There being a classification as to the nature of services rendered and duties discharged, the basis on which respective Rules/Orders are applicable as observed earlier, this Court cannot ignore the fact that there is a clear distinction between the workmen and Supervisory staff. Rule 8 (iii) however, on a plain reading thereof, has given a blanket stipulation that no employee to whom this rule applies, shall seek membership of any registered trade union or indulge in trade union activity. Couched in these terms, by the application of this Rule, the participation of the Supervisory staff who are governed by the CDA Rules therefore, will be circumscribed and governed by this rule which will severely limit any union activity. On this aspect, this Rule by totally extinguishing the rights of the Supervisory staff is therefore unsustainable. The Hon'ble Supreme Court in the case of Tirumala Tirupati Page 11 of 14 Devasthanam vs. Commissioner of Laboour & Ors. reported in (1995) 3SCC 653 at Para-4 has held as follows :-
"4. It would be apparent from this definition that any group of employees which comes together primarily for the purpose of regulating the relations between them and their employer or between them and other workmen may be registered as a trade union under the Act. It cannot be disputed that the relationship between the appellant and the workmen in question is that of employer and employee. The registration of the association of the said workmen as a trade union under the Act has nothing to do with whether the said wings of the appellant are an industry or not. We are, therefore, of the view that the High Court went into the said issue, although the same had not arisen before it. Since the findings recorded by the High Court on the said issue, are not germane to the question that falls for consideration before us, we express no opinion on the same and leave the question."
This judgment has therefore laid down that any group of employees may be registered as trade union under the Act for the purposes of regulating the relations between them and their employer.
11. What follows from this discussion therefore is that no authority can dis-allow or limit the right of any group of employees to form and be registered as a trade union under the Act, if all legal requirements are met. To this extent therefore, the impugned Rule 8
(iii), cannot pass judicial scrutiny. However, on the other hand, as put forth by the respondent Corporation, the insertion of the Rule was with the object of putting a reasonable restriction on the activities of only the employees who are governed by the CDA Rules. This Court on this Page 12 of 14 aspect of the matter accepts the contentions, in view of the fact that the workmen are governed by the Standing Orders and the Supervisory staff by the CDA Rules, and due to this distinction, the relations with the respondent Corporation i.e. of the workmen and Supervisory staff stand on a different footing. The object of the Rule to come within the meaning of a reasonable restriction is therefore met, but the language of Rule 8 (iii) however, conveys otherwise, as there can be no restriction to being part of a trade union as this would be against the very object of the Trade Unions Act.
12. In this view of the matter therefore, as both the aforesaid categories of employees are governed by a different set of Rules and the problems, demands of workmen are different from the problems and demands of non-workmen, it stands to reason that a restriction was sought to be put in, to ensure that workmen and non-workmen be represented by the respective unions, as this would be in the interest of the rights of the workers in the respondent Corporation. In the considered view of the Court, the respondent Corporation is well within its rights to classify its employees into two categories i.e. workmen and non-workmen with the objective to apply the provision of various Industrial laws to the workmen and confer benefit upon them. This should not mean however, that the management cadre employees Page 13 of 14 cannot form unions of their own and engage in trade unions activities for the benefit of its members.
13. The CDA Rules are not statutory rules, and this position is undisputed as the power to make bye laws is conferred by the Memorandum and Articles of Associations of the Company upon the Board. However, it cannot be said that the protection of Article 19 (1)
(c) will not be available to the Supervisory staff, who though may be restricted from joining the workers union however, cannot be deprived of the right of forming and becoming members of their own trade union. The object of the classification and restriction though finding approval by this Court, however the text of Rule 8 (iii) which conveys otherwise is found to offend Article 19 (1) (c) and as such it is struck down.
14. In view of the observations and discussions made hereinabove, this Court will not further allude to the authorities placed by the respective parties and this writ petition stands allowed to the extent indicated above and is accordingly disposed of.
15. No order as to costs.
JUDGE Meghalaya 01.12.2022 "V. Lyndem-PS"
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