Andhra HC (Pre-Telangana)
Smithkline Beecham Consumer Health ... vs S.B.C.B. Limited Operators And Workers ... on 13 March, 2002
Equivalent citations: 2002(3)ALD59, 2002(3)ALT684, [2002(94)FLR1063]
JUDGMENT S.R. Nayak, J.
1. Both these writ appeals are directed against the same judgment of the learned single Judge dated 4-8-1998 in writ petition No. 17556 of 1994. Writ Appeal No. 1590 of 1998 is filed by M/s. Smithkline Beecham Consumer Health Care Limited - the 2nd respondent in the writ petition whereas Writ Appeal No. 1599 of 1998 is by HMM Limited (Horlicks) Workers Union - the 5th respondent in the writ petition.
2. Writ Petition No. 17556 of 1994 was filed by SBCB Limited Operators and Workers Union - the 1st respondent in the writ appeals for the following relief:
Under the circumstances, we pray that this Hon'ble Court may be pleased to issue an appropriate writ or order or direction under Article 226 of Constitution of India, particularly one in the nature of the writ of certiorari, quashing the award passed by the 4th respondent herein in ITID No. 4/92, dated 29-7-1994 as unjust and illegal after calling for the records.
3. Although initially the above relief was sought in the writ petition, subsequently the petitioner filed WPMP No. 28674 of 1995 seeking amendment to the prayer by way of substitution of a new prayer which was ordered by the learned single Judge on 19-10-1995. The prayer as amended reads as follows:
Petition under Article 226 of the Constitution of India praying that in the circumstances stated in the affidavit filed herein the High Court will be pleased to issue an appropriate writ or order or orders under Article 226 of the Constitution of India declaring the Clause 10 of the settlement to the extent of authorising the management to deduct Rs. 3,000/- out of an ad hoc amount of Rs. 13,500/- for paying to the 5th respondent union is quite unfair, unjust and unfair labour practice in place of para 12 of the affidavit filed in support of the writ petition.
4. The resultant position is that Clause (10) of the settlement dated 8-7-1994 entered into between the 5th respondent-trade union and the management under Section 18(1) of the Industrial Disputes Act, 1947 (for short 'the Act') is assailed in the writ petition.
5. The facts leading to the filing of the writ petition may be noted briefly as under.
6. During the month of October, 1993 there was industrial unrest among the workmen of the Smithkline Beecham Consumer Health Care Limited. The management declared lock out from 23-10-1993. As a consequence thereof, number of workmen were suspended and disciplinary proceedings were initiated. The lock out was lifted with effect from 1-1-1994. The Government of Andhra Pradesh referred the charter of demands made by the 5th respondent-trade union to the Industrial Tribunal-cum-Labour Court, Visakhapatnam (for short 'the Industrial Tribunal') for adjudication vide its G.O. Rt.No.2518, dated 22-11-1993 and the Industrial Tribunal, on receipt of the reference, numbered the same as ITID No. 4 of 1993. While the reference was pending adjudication before the Industrial Tribunal, the 5th respondent-trade union, to have industrial peace and harmony, attempted negotiation with the management of the industry and ultimately an amicable settlement was executed between the 5th respondent and the management under Section 18(1) of the Act on 8-7-1994.
7. There is no necessity for us to refer to other clauses in the settlement except Clause (10) of the settlement because the dispute brought before the Court exclusively relates to Clause (10) of the settlement and not other clauses. Clause (10) of the settlement reads as follows:
The management agrees to pay a one time ad hoc amount of Rs. 13,500/- (Rupees thirteen thousand and five hundred only) to all the permanent workmen who were on the rolls of the company as on 1st November, 1992 and continue to be on rolls as on 8-7-1994. This ad hoc payment would not be considered as remuneration/wages and would not be covered for ESI, Provident Fund, Bonus, etc., and for any other payment linked to wages.
HMM Limited (Horlicks) Workers Union has singed many settlements and has worked for many years for the benefit of the workmen. It is agreed therefore that out of the ad hoc amount, each workman would contribute Rs. 3,000/- (Rupees three thousand only) towards the fund of the union. The net amount after deducting this contribution would be paid to the workmen. The contribution towards the union fund would be given by the management by cheque to union after deductions have been made from the ad hoc payment.
8. After the settlement, it appears from the record, that a memo was filed before the Industrial Tribunal reporting settlement of the dispute. On the basis of that memo the Industrial Tribunal passed the award on 29-7-1994 which reads as follows:
Memo filed reporting adjustment. Adjustment out of Court Nil award is passed accordingly. Reference is answered accordingly.
9. That led to the 1st respondent herein to file Writ Petition No. 17556 of 1994 initially challenging the validity of the award, but subsequently, amending the relief giving up challenge to the award but to assail validity of Clause (10) of the settlement dated 8-7-1994.
10. Before the learned single Judge, on behalf of the petitioner, it was contended that Clause (10) of the settlement dated 8-7-1994 which provides for deduction of Rs. 3,000/- uniformly from each workman and crediting the same to the account of the 5th respondent is ex facie illegal inasmuch as that stipulation is in conflict with items 2 and 9 in part I of the V Schedule to the Act. The learned single Judge, on consideration of that contention, found that item 2 is not attracted whereas item 9 is attracted. In that view of the finding and also having regard to the fact that the 5th respondent has not disclosed necessary particulars as to the sum of money paid to the three workmen whose termination was insisted by the management as a condition to enter into settlement under Section 18(1) of the Act, disposed of the writ petition declaring that the agreement between the management and the 5th respondent, as incorporated in Clause (10) of the settlement, does not bind the writ petitioner-Union and its members and observing thus:
However, in the background of the facts of the present case, where a substantial number of workers have not admittedly accepted even the benefits arising out of the settlement, it cannot be held that such a settlement binds all the workmen irrespective of the fact whether they are the members of the union which negotiated the settlement.
The argument was advanced by the leamed Counsel for the respondents that it is not open for the petitioner-Union to accept the benefits of the settlement but reject the liability created under the settlement. As I have already noticed, factually, a substantial number of workmen have not accepted even the benefits of the settlement. Apart from that the liability created under the settlement on the face of it, having regard to the discussion earlier, is for the benefit of the recognised union (fifth respondent) and does not appear to be for the benefit of the entire work force. In these circumstances, I do not see any force in the submission made by the learned Counsel for the respondents.
For all the above-mentioned reasons, I am of the opinion that Clause 10 of the settlement dated 8-7-1994 insofar as it stipulates:
'It is agreed therefore that out of the ad hoc amount, each workman would contribute Rs. 3,000/- (Rupees three thousand only) towards the fund of the union. The net amount after deducting this contribution would be paid to the workmen. The contribution towards the union fund would be given by the management by cheque to union after deductions have been made from the ad hoc payment.
does not bind the petitioner-Union and its members, as in my view, the said clause would amount to an unfair labour practice as discussed above and the same is liable to be declared as such.
11. Hence these two writ appeals by the management as well as by the 5th respondent-trade union.
12. Sri E. Manohar, the learned senior Counsel appearing for the management in both the writ appeals, at the threshold would contend that the writ petition filed by the writ petitioner-Union is not maintainable. M/s. Smithkline Beecham Consumer Health Care Limited is a company registered under the Companies Act and it cannot be treated as a State or an instrumentality of the State under Article 12 of the Constitution of India or as an authority for the purpose of Article 226 of the Constitution of India. The learned senior Counsel would point out that in the light of the judgment of this Court in Sri Konaseema Co-operative Central Bank Limited v, N, Seetharama Raju, AIR 1990 AP 171 (FB) and a recent judgment of this Court in D. Nageswara Rao v. Guntur District Milk Producers, Cooperative Union Limited, (DB), to which one of us (S.R. Nayak, J) is a member, the writ petition is not maintainable. Alternatively, the learned senior Counsel would contend that the writ petitioner-union cannot be permitted to gain only advantages flowing from the settlement dated 8-7-1994 but not the liabilities and such a thing is impermissible in the light of the judgment of the Apex Court in B.L. Workers' Union, Bombay v. B.L. and Company Limited, , Tata Engineering and Locomotive Company Limited v. Their Workmen, and Herbertsons Limited v. Workmen, AIR 1977 SC 322.
13. The learned Counsel appearing for the 5th respondent-trade union which is the appellant in Writ Appeal No. 1599 of 1998, while adopting the arguments of the learned senior Counsel for the management and further drawing our attention to what is stated in paragraph 4 of the counter-affidavit filed in Writ Petition No. 17556 of 1994, would point out that the provision was made in the settlement to deduct a sum of Rs. 3,000/- from each workman to meet the expenditure incurred by the 5th respondent-trade union to compensate three workmen whose services are agreed to be terminated as a condition to enter into settlement under Section 18(1) of the Act.
14. Sri. P. Venkateswarlu, the learned senior Counsel appearing for the writ petitioner, with his usual persuasiveness and force, would contend that the offending provision contained in Clause (10) of the settlement enabling the management to deduct a sum of Rs. 3,000/- from the dues of each workman and to credit the same to the account of the 5th respondent is ex facie arbitrary, illegal and tantamount to unfair labour practice within the meaning of items 2 and 9 of part I of the V Schedule to the Act and, therefore, the writ petition filed by the union is maintainable. The learned senior Counsel would contend that the writ petition under Article 226 of the Constitution of India is maintainable against natural and legal person regardless of the fact whether such person could be treated as State or instrumentality of State under Article 12 of the Constitution of India or as an authority for the purpose of Article 226 of the Constitution of India if it is intended to enforce public law obligation. In that connection the learned Counsel would rely on certain authorities to impress upon us that writ could lie to enforce public law obligation even assuming that M/s. Smithkline Beecham Consumer Health Care Limited cannot be treated as a State or as -an instrumentality of the State as contended by the learned senior Counsel for the management.
15. Since the learned senior Counsel for the management has raised a plea which goes to the root of the matter, it is appropriate for the Court to deal with the question relating to maintainability of writ petition in the first instance.
16. Admittedly, even according to the petitioner, the settlement in which the offending provision is found is entered into between the rival trade union-5th respondent and the management of the industry under Section 18(1) of the Act. Section 18(1) of the Act reads as follows:
A settlement arrived at by agreement between the employer and workman otherwise than in the course of conciliation proceeding shall be binding on the parties to the agreement.
17. Since admittedly the settlement is entered into between the parties under Section 18(1) of the Act, it is trite that the settlement would bind only the parties to the agreement but not others. In other words, in law whatever may be the stipulations or the terms of the settlement entered into between the management and a rival trade union-5th respondent under Section 18(1) of the Act, those stipulations or the terms in no way affect or impair any of the legal rights of other workmen, by force of the clear declaration contained in Sub-section (1) of Section 18 of the Act. If that is the position in law the first question to be considered by the Court is whether the petitioner-trade union or its member-workmen can be said to be aggrieved persons as regards settlement entered into between the 5th respondent and the management under Section 18(1) of the Act and the answer would be clear 'no'. Of course, as we could see, the settlement dated 8-7-1994 did not remain as a settlement only having regard to the fact that the industrial tribunal answered the reference in terms of the settlement thereby meaning in terms of the settlement. However, though the award passed by the industrial tribunal was initially challenged the petitioner-trade union, in its wisdom, thought it appropriate to abandon that relief and amended the relief to assail only Clause (10) of the settlement. In the light of our opinion that the members of the petitioner-trade union cannot be said to be aggrieved parties, the writ petition filed by them is not maintainable. In that view of the matter, there is no scope for the Court to go into the question whether the stipulation in Clause (10) of the settlement dated 8-7-1994 offends or is in contravention of items 2 and 9 of part I of the V Schedule to the Act or not. It is appropriate for the Court to leave that question open to be decided at appropriate stage if there is any need to resolve that legal question.
18. In the result and for the foregoing reasons, we allow the writ appeals and set aside the order of the learned single Judge made in Writ Petition No. 17556 of 1994 and dismiss the writ petition as not maintainable with no order as to costs.