Gujarat High Court
Navalbhai Karsanbhai Chauhan vs Shri Digvijay Woolen Mills Ltd. on 4 August, 1987
Equivalent citations: (1987)2GLR1091, (1988)IILLJ101GUJ
Author: S.B. Majmudar
Bench: S.B. Majmudar
JUDGMENT Majmudar, J.
1. In this petition under Art. 226/227 of the Constitution, a short but an interesting question is posed for our consideration. The question is whether a reference of industrial dispute centering round dismissal of a workman awaiting decision of approval application under Section 33(2)(b) of the Industrial Disputes Act, 1947 ('the Act' for short) as taken out by the employer, can be said to be premature.
2. A few relevant facts leading to this petition are required to be noted at the outset, to appreciate the contours of the controversy posed for our consideration. The petitioner was serving as a fitter in the respondent mill company since 4th August 1973. He was served with a charge sheet dated 5th December 1975 alleging that on 4th December 1975, while the petitioner was leaving the factory premises at 4-50 P.M. a search was made of the petitioner and his belongings at the middle gate by the watchman. The watchman after searching the body of the petitioner asked the petitioner to show his jersey which has folded and kept on cycle carrier. While the petitioner was unfolding the jersey, two washing soap cakes fell from the jersey on the ground. On this charge the petitioner was served with a charge sheet and a departmental inquiry was conducted against him. After completion of the departmental inquiry, the respondent mill company dismissed the petitioner from service by an order dated 20th August 1976. At that time, Reference (IT) No. 188 of 1976 regarding revision of wages was pending before the Industrial Tribunal. Consequently, the respondent company applied to the said Tribunal for approval of its action under Section 33(2)(b) of the Act. The petitioner in the meantime had raised an industrial dispute centering round the order of his dismissal. He had approached the conciliation officer for conciliation under the provisions of the Act. As the conciliation failed, the Commissioner of Labour as competent authority referred the dispute of the petitioner to the Labour Court at Rajkot for adjudication of the dispute of the petitioner about his illegal dismissal and reinstatement in service with full back wages. The said reference was made on 5th January 1977. Eight days thereafter, precisely on 13th January 1977, the Tribunal before which the approval application under Section 33(2)(b) was moved by the management, granted the said approval application. Thereafter, the reference as filed by the petitioner before the Labour Court for adjudication of his dispute being Reference (LCR) No. 2 of 1977 which was pending before the Presiding Officer, Second Labour Court, Rajkot, was taken up for adjudication. The respondent-management took up a preliminary objection to the effect that the reference itself was premature as it was made on 5th January 1977 by the competent authority while the approval application was granted on 13th January 1977 and it is on the grant of this approval that the order of dismissal came into force and consequently on the day on which the reference was made, the order of dismissal was not in force. Therefore, there was no industrial dispute in existence on 5th January 1977 between the parties and consequently, the reference as filed was premature and incompetent. It is the aforesaid preliminary objection canvassed by the respondent which was taken up for consideration by the Presiding Officer of the Labour Court, who after hearing both the parties, came to the conclusion that the reference as made on 5th January 1977 was premature and that the workman may raise a dispute if so advised thereafter. The said Order of the Presiding Officer was rendered on 12th March 1979. By the said order, the reference was dismissed as premature. As stated above, the aforesaid decision of the Labour Court has been brought in challenge by the dissatisfied workman by way of the present petition.
3. Mr. P. C. Master for the petitioner vehemently contended that under the scheme of the Act, when the order of dismissal or discharge as passed by the management is sought to be approved by the competent authority under Section 33(2)(b) of the Act, the concerned order does not lose its efficacy because the approval application is pending. If the approval application is granted, the approval relates back to the date of the original order but the order remains in the field nevertheless till that approval is granted or refused. Thus, pendency of the approval application under Section 33(2)(b) does not nullify or wipe out the order of dismissal or termination and the proceedings for approval under Section 33(2)(b) do not have the same consequence as the proceddings under Section 33(1) or 33(3) of the Act which deal with permission proceedings where the concerned orders can be passed after permissions are granted by the appropriate authority. It was, therefore, submitted that the Labour Court was patently in error in taking the view that the reference was premature as the dismissal order had already been passed months back in August 1976 while the Reference was made on 5th January 1977. That Reference, therefore, could not have been treated as premature. It was further contended that in any case, under Section 10 of the Act, appropriate authority can refer a dispute not only in case an industrial dispute exists but even in cases where it is apprehended between the parties. It was also contended that looking to the broad definition of 'industrial dispute' even proposed order of dismissal would be covered even assuming that it is merely a proposed order. It was lastly submitted that in any case on the day on which the Labour Court dismissed the Reference as premature on 12th March 1979, the approval application had stood granted already and more than two years had passed since then. Consequently Labour Court has taken too narrow a view of the existing situation, that the Reference as made was at the highest premature only for eight days from 5th January 1977 to 13th January 1977, but atleast from 13th January 1977, when the approval application was granted, though conditionally, by the Tribunal, the Reference would not be premature and thereafter, the Labour Court could not have rejected it as premature.
4. Mr. K. R. Vyas for the respondent on the other hand, submitted that it is not as if that the order of dismissal or termination which is subject to approval application proceedings under Section 33(2)(b) puts an end to the employer-employee relationship and that if approval is ultimately not granted, there would remain no question of enforcing the order of dismissal or termination, as the case may be. He, therefore, submitted that the proper stage at which reference could have been made would be the stage which would reach after the respondent's approval application was granted by the Tribunal and not before that. In these circumstances, the order of the Labour Court dismissing the Reference as premature was perfectly justified. He further submitted that in any case, the Labour Court itself has observed as back as in 1979 that the workman could raise an industrial dispute then, if so advised. Instead of raising such dispute, he has waited for all these years and made the company suffer consequently in these pending proceedings. He, therefore, contended that this petition deserves to be dismissed.
5. Having carefully considered the aforesaid rival contentions, we have reached a conclusion that the order of the Presiding Officer of the Labour Court cannot be justified either in fact or in law and that the Labour Court has committed a patent error of law and jurisdiction in dismissing the Reference as premature. The reasons for our conclusion are obvious. Under Section 10 of the Act, appropriate Government can make an order in writing referring dispute for adjudication of appropriate authority if the Government is of the opinion that any industrial dispute exists or is apprehended. Thus, even in case of apprehended dispute, a reference can validly be made for adjudication of dispute. When we turn to the definition of 'industrial dispute', we find in Section 2(k) that 'industrial dispute' means any dispute or difference between employers and employers, or between employers and workmen, or between workmen and workmen, which is connected with the employment or non-employment or the terms of employment or with the conditions of labour, of any person. The aforesaid definition is very widely worded and any difference or dispute between the employer and employee in connection with terms of employment or conditions of labour of any person would be covered by the term 'industrial dispute'. Thus, when the respondent company after inquiry passed an order dismissing the petitioner from service on 20th August 1976, it cannot be said that there did not arise on that day any dispute or difference between the petitioner on the one hand and the respondent company on the other which would be connected with employment or non-employment or terms of employment or conditions of labour of the petitioner. It is true that because of pendency of another industrial dispute before the Industrial Tribunal, the respondent company had to follow the procedure of obtaining approval of its action from the concerned Tribunal as per Section 33(2)(b) of the Act. The said provision reads as under :-
"33 (2). During the pendency of any such proceeding in respect of an industrial dispute, the employer may, in accordance with the standing orders applicable to a workman concerned in such dispute or, where there are no such standing orders, in accordance with the terns of the contract, whether express or implied between him and the workman -
(b) for any misconduct not connected with the dispute, discharge or punish, whether by dismissal or otherwise, that workman.
Provided that no such workman shall be discharged or dismissed, unless he has been paid wages for one month and an application has been made by the employer to the authority before which the proceeding is pending for approval of the action taken by the employer."
6. A mere look at the aforesaid provision shows that in approval application, the approval of the concerned authority has to be obtained for the action taken by the employer. Thus, action comes first and then follows the approval on a proper application being made and which is granted by the concerned authority. It cannot, therefore, be said that merely because the respondent company had filed an approval application under Section 33(2)(b) of the Act, the action taken by it of dismissing the petitioner from service on 20th August 1976 had not remained a completed action or that it was merely a proposed action. The questions of proposed actions arise in cases of permission applications which are moved by the concerned employers under Section 33(1) and or 33(3) of the Act which refer to entirely a different situation. The said provisions may be extracted with advantage at this stage to contradistinguish them with the nature of provision under Section 33(2)(b) with which we are concerned :-
"33 (1). During the pendency of any conciliation proceeding before a conciliation officer or a Board or of any proceeding before an arbitrator or a Labour Court or Tribunal or National Tribunal in respect of an industrial dispute, no employer shall -
(a) in regard to any matter connected with the dispute, alter, to the prejudice of the workmen concerned in such dispute, the conditions of service applicable to them immediately before the commencement of such proceeding; or
(b) for any misconduct connected with the dispute, discharge or punish, whether by dismissal or otherwise, any workman concerned in such dispute, save with the express permission in writing of the authority before which the proceeding is pending.
x x x (3) Notwithstanding anything contained in sub-section (2) no employer shall, during the pendency of any such proceeding in respect of an industrial dispute, take any action against any protected workman concerned in such dispute -
(a) by altering, to the prejudice of such protected workman, the conditions of service applicable to him immediately before the commencement of such proceedings; or
(b) by discharging or punishing whether by dismissal or otherwise, such protected workman, save with the express permission in writing of the authority before which the proceeding is pending."
7. The aforesaid provisions about permission applications clearly indicate that save and except with express permission in writing of the concerned authority, the employer in the contingencies covered by Section 33(1) on the one hand and Section 33(3) on the other, cannot pass orders of dismissal or discharge as contemplated by these provisions. Thus, in cases of permission applications, written permission comes first and then follows permitted order or action by way of discharge or punishment as the case may be. Till this time, employer-employee relationship continues. It is not snapped obviously because there is no order of such dismissal or termination passed by the management as the condition precedent of permission in writing of the authority is still awaited. It is after the condition precedent is satisfied that action can follow. Obviously such is not the situation covered by Section 33(2)(b) where approval of the authority of action already taken by the management has to be obtained. In such a case, action comes first, approval comes later. Consequently, the Labour Court was patently in error in taking the view that the reference as moved on 5th January 1977 was premature. It was fully mature notwithstanding the fact that approval application as moved by the respondent company got sanctioned eight days later on 13th January 1977. In this connection, we may refer with advantage to a few decisions of the Supreme Court on which reliance was placed by the learned Advocates of the respective parties before us.
8. In the case of Lalla Ram v. D.C.M. Chemical Works, (1978-I-LLJ-507), provisions of Section 33(2)(b) came to be considered by the Supreme Court. Though the Supreme Court was concerned with the nature of proceedings under Section 33(2)(b) and the type of jurisdiction exercised by the Industrial Tribunal in such case, on the construction of the Section, the following pertinent observations were made by Jaswant Singh, J. (as he then was) speaking for the Supreme Court in para 13 of the report :-
"In the proceedings under Section 33(2)(b) of the Act, the jurisdiction of the Industrial Tribunal is confined to the enquiry as to (i) whether a proper domestic enquiry in accordance with the relevant rules/standing orders and principles of natural justice has been held; (ii) whether a prima facie case for dismissal based on legal evidence adduced before the domestic tribunal is made out; (iii) whether the employer had come to a bona fide conclusion that the employee was guilty and the dismissal did not amount to unfair labour practice and was not intended to victimise the employee, regard being had to the position settled by the Supreme Court that though generally speaking the award of punishment for misconduct under the Standing Orders is a matter for the management to decide and the Tribunal is not required to consider the propriety or adequacy of the punishment or whether it is excessive or too severe yet an inference of mala fides may in certain cases be drawn from the imposition of unduly harsh, severe, unconscionable or shockingly disproportionate punishment; (iv) whether the employer has paid or offered to pay wages for one month to the employee; and (v) whether the employer has simultaneously or within such reasonably short time as to form part of the same transaction applied to the authority before which the main industrial dispute is pending for approval of the action taken by him. If these conditions are satisfied, the Industrial Tribunal would grant the approval which would relate back to the date from which the employer had ordered the dismissal. If however, the domestic enquiry suffers from any defect or infirmity, the labour authority will have to find out on its own assessment of the evidence adduced before it whether there was justification for dismissal and if it so finds it will grant approval of the order of dismissal which would also relate back to the date when the order was passed provided the employer had paid or offered to pay wages for one month to the employee and the employer had within the time indicated above applied to the authority before which the main industrial dispute is pending for approval of the action taken by him."
9. We may also refer to the case of Punjab National Bank v. A.I.P.N.B.E. Federation, (1959-II-LLJ-666). In that case, the Supreme Court was concerned with legal position which would obtain in cases where applications are moved for requisite permission under Section 33 of the Act by the employer seeking permission to pass requisite orders terminating services of an employee on the ground of misconduct. The Supreme Court, speaking through Gajendragadkar, J. (as he then was) for the majority, laid down as under at p. 678 :
"In these proceedings, it is not open to the Tribunal to consider whether the order proposed to be passed by the employer is proper or adequate or whether it errs on the side of excessive severity; nor can the Tribunal grant permission, subject to certain conditions, which it may deem to be fair. ... But it is significant that even if the requisite permission is granted to the employee under Section 33, that would not be the end of the matter. It is not as if the permission granted under Section 33 validates the order of dismissal. It merely removes the ban; and so the validity of the order of dismissal still can be, and often is, challenged by the union of the employees by raising an industrial dispute in that behalf."
It is pertinent to note that in the aforesaid decision, the Supreme Court while considering the scope and ambit of application for permission under Section 33, held that proposed action taken by the employer even if permitted would not put an end to the industrial dispute. On the contrary, even such permission for passing proposed order can be challenged by way of raising a substantial industrial dispute. However, in such cases, such proposed orders after being permitted to be passed by appropriate authority under Section 33 can be again subjected to reference procedure under Section 10 of the Act, but in cases of approval, the situation, as already discussed above, will be entirely different.
10. Mr. Vyas for the respondent invited our attention to the case of P. D. Sharma v. State Bank of India (1969-I-LLJ-513). In that case, the Supreme Court has an occasion to consider the scheme of sub-secs. (2) and (3) of Section 33 of the Act. Considering the said scheme. Hegde J. speaking for the Supreme Court, in p. 518 of the report, made the following observations :-
"On a comparison of sub-secs. (2) and (3) of Section 33 it will be seen that the scope of the two provisions are wholly different. Taking the case of a worker's discharge or punishment by dismissal or otherwise, in the former the previous permission of the authority before which the industrial dispute is pending is necessary but under the latter only a suggestion approval from a competent authority is needed. Though the application under that provision should be made to the authority before which the industrial dispute is pending, the approval to be obtained need not be from that authority. Once approval is given it goes back to the date on which the order in question was made. If the approval asked for is not accorded then he action taken by the employer becomes ab initio void and the employee will continue in service and his conditions of service will also continue without any break as if the order in question had not been made at all".
11. We may lastly refer to the latest decision of the Supreme Court in the case of Fakirbhai Fulabhai Solanki v. Presiding Officer, (1986-II-LLJ-124) to which our attention was invited by Mr. Vyas for the respondent. The Supreme Court in that case was concerned with the question of grant of subsistence allowance to workman who was sought to be dismissed by the management and for which permission was sought for by the management under Section 33(3) of the Act before the Tribunal. Considering the scheme of Section 33(3) of the Act, E. S. Venkataramiah, J. speaking for the Supreme Court held in the aforesaid case that till permission was obtained for the proposed action, employer-employee relationship did not cease and under these circumstances even though the employee was suspended pending the inquiry by the management, he would be entitled to be paid subsistence allowance during the currency of the permission application under Section 33(3) of the Act and that if such subsistence allowance was not paid, the workman can be said to have been denied a reasonable opportunity of defending himself in the permission proceedings before the Tribunal. It is pertinent to note that the aforesaid decision of the Supreme Court is rendered in the context of proceedings under Section 33(3) of the Act which contemplate permission applications for permitting the management to pass proposed orders or to take proposed action adverse to the employee. However, the observations of the Supreme Court in para 9 of the report are very relevant for our present purpose. In that para, scheme of Section 33(1) was contrasted with the scheme of provisions of Section 33(2)(b) and in this connection, it was observed (1986-II-LLJ-124 at 129) as under :-
"The case falling under Section 33(1) of the Act is not in any way different from a case falling under sub-section (3) of Section 33 and in both these cases previous permission of the authority concerned should be obtained before any action is taken against the workman concerned unlike a case falling under Section 33(2)(b) of the Act where only its approval to an action already taken is required to be sought."
12. In view of the aforesaid settled legal position, it is obvious that when the application of the respondent management in the present case was for obtaining approval under Section 33(2)(b) of the Act for its action of dismissal of the petitioner dated 20th August 1976, it cannot be said that the action was not complete on that day or that an industrial dispute centering round the said dismissal order had not come into existence on that day. The reference for resolution of that dispute, therefore, was rightly and properly made by the appropriate authority to the Labour Court. That reference could not have been short-circuited and snuffed out on the ground that it was premature. With respect, the Labour court on a complete misconception of law and fact failed to exercise its jurisdiction and made a short work of the Reference. The impugned order, therefore, cannot be sustained at all.
13. But even apart from that, even assuming that the Reference was premature on 5th January 1977 as the approval application was till that time not decided, once it got decided on 13th January 1977 i.e. after eight days atleast from that day onwards the original reference which might have been premature blossomed into complete maturity and on 13th January 1977, it can ultimately be said that there was full-fledged industrial dispute which had matured between the parties and it was holding the field. The Labour Court could not have rejected the reference as premature on 12th March 1979 i.e. precisely more than two years from the date on which the approval application was already granted by the competent authority on the ground that the Reference even on that day was premature. The Labour Court ought to have taken cognizance of the subsequent event in the interest of justice and ought to have tried to make an endeavour to see whether the reference which was allegedly premature at initial stage had matured during the pendency of the proceedings or not. Even that exercise was not undertaken by the Labour Court. Even on that ground, the impugned order cannot be sustained. For all these reasons, the impugned order at Annexure 'A' is quashed and set aside. Reference (ICR) No. 2 of the 1977 is restored to the file of the Presiding Officer of the concerned Labour Court at Rajkot with a direction to the concerned Labour Court to proceed further with the said reference in accordance with law and to decide the same on merits after hearing the concerned parties. As the proceedings are over-delayed and the petitioner was dismissed from service as early as on 20th August 1976, and as more than 11 years have rolled by, it would be in the interests of justice to direct the Labour Court to fix up this reference for decision on merits and to decide the same within four months of the receipt of writ of this order at its end. Rule is accordingly made absolute with no order as to cost.