National Textiles Corporation ... vs Presiding Officer Labour Court ...
2023 Latest Caselaw 3940 ALL

HIGH COURT OF JUDICATURE AT ALLAHABAD
 
 

Reserved on:- 01.02.2023
 
Delivered on:- 08.02.2023
 
Court No. - 10
 

 
Case :- WRIT - C No. - 27216 of 1998
 
Petitioner :- National Textiles Corporation Ltd.
 
Respondent :- Presiding Officer Labour Court And Others
 
Counsel for Petitioner :- Devendra Pratap,Devendra Pratap Singh,Siddharth Singh,D.P.Singh,Devendra Pratap Singh
 
Counsel for Respondent :- C.S.C.,K.P.Agarwal,Mahima Maurya,Suman Sirohi,Sumati Rani Gupta
 

 
Hon'ble Rohit Ranjan Agarwal,J.

1. Heard Sri Devendra Pratap Singh, learned counsel for the petitioner, learned Standing Counsel for the State and Ms. Sumati Rani Gupta, learned counsel for the respondent no.2.

2. This writ petition has been filed challenging the award dated 15.01.1998, published on 16.05.1998 passed by Labour Court (IVth), Kanpur in Adjudication Case No.92/96.

3. Petitioner before this Court, M/s National Textiles Corporation (U.P.) Ltd., Kanpur is a public undertaking registered under the Companies Act. It is a subsidiary of National Textiles Corporation, New Delhi. The petitioner-Company in order to supply cheap and good quality clothes had opened several retail outlets throughout the State of U.P., where the clothes, stitched in the mills, are being sold. The Company has a retail show-room known as National Textile Corporation show-room in city of Etawah.

4. The respondent no.2 was posted as an employee at the Etawah show-room. During the period he served, an inspection was made at the show-room, and a shortage of clothes in the show-room to the tune of Rs.63,892.85/- was found. The amount was directed to be recovered from the incentive scheme which was given to the staff of the show-room proportionally. Respondent no.2 was served with a charge-sheet and after inquiry, it was found that respondent no.2 was liable for the shortfall of Rs.42,000/-. After the departmental inquiry, he was dismissed from service on 07.06.1995.

5. Respondent no.2 raised an industrial dispute, and the State Government on 20.01.1996 referred the dispute under Section 4-K of the U.P. Industrial Dispute Act to the Labour Court, Kanpur. By the award impugned, the Labour Court had required the workmen/respondent no.2 to be re-instated with backwages, hence the present writ petition.

6. Learned counsel for the petitioner submitted that National Textile Corporation is a Central Government undertaking, and the appropriate Government is the Central Government, which exercises full control over the petitioner and thus, no reference can be made by the State Government exercising power under Section 4-K of the Act. He submitted that the question as regards ''appropriate Government' had already attained finality by the judgment of the Constitution Bench of the Supreme Court in case of Steel Authority of India Vs. National Union Water Front Workers and others, 2001 (7) SCC 1, which was followed by the Supreme Court in case of Hindustan Aeronautics Ltd. Vs. Hindustan Aero Canteen K. Sangh, Civil Appeal No.3659 of 2002, decided on 08.07.2002.

7. Reliance has also been placed upon the decision of Co-ordinate Bench of this Court in cases of M/s National Textiles Corporation U.P. Ltd., Kanpur Vs. State of U.P. and others, decided on 14.09.2004 in Civil Misc. Writ Petition No.45538 of 2003, M/s National Textile Corporation and Another Vs. Labour Court Allahabad and Others, decided on 16.11.2021 in Writ- C No.29445 of 2010, Laxmiratan Cotton Mills Vs. Labour Court-I Kanpur and Others, decided on 26.10.2021 in Writ-C No.17749 of 1999, M/s Atherton Mills Vs. Ubdhystruak Truvybak (III) and Others, decided on 15.01.20213 in Writ-C No.15379 of 2000 and M/s Muir Mills Vs. Labour Court and Another, decided on 02.05.2013 in Writ- C No.51192 of 1999 as well as decision of Supreme Court in cases of Kanwar Singh Saini Vs. High Court of Delhi, decided on 23.09.2011 in Criminal Appeal No.1798 of 2009 and Jagmitrrar Sain Bhagat & Others Vs. Director Health Services, Haryana & Others, decided 11.07.2013 in Civil Appeal No.5476 of 2013.

8. He then contended that the matter stands concluded as the Co-ordinate Bench on 14.09.2004 in another matter of the petitioner had already decided that the State Government was not empowered to refer the dispute of National Textile Corporation exercising power under Section 4-K of the Act.

9. Per contra, Sumati Rani Gupta, learned counsel appearing for the workmen submitted that the State Government was empowered under Section 4-K of the Act to refer the matter to Labour Court. She contended that the phrase any industry carried on under the authority of the Central Government implies an industry which is carried on by virtue of, pursuant to, conferment of, grant of, or delegation of power or permission by Central Government to a Central Government Company or other Government company/undertaking. She has relied upon the decision of Steel Authority of India (supra).

10. I have heard counsel for the parties and perused the material on record.

11. The short controversy engaging attention of the Court is whether reference made by the State Government exercising power under Section 4-K to the Labour Court, was within its competence, in case of an employee of a public sector undertaking of Government of India. The controversy is no more res integra after the decision of Hon'ble Apex Court in case of Steel Authority of India (supra), wherein the Court after considering the definition of the word ''Appropriate Government' held that the Government which exercises control and authority over the concerned organization will be appropriate Government. The said decision was followed by another decision of the Apex Court in case of Hindustan Aeronautics Ltd. (supra).

12. In the instant case, there is no denial to the fact that National Textile Corporation is a Central Government undertaking and under the control of the Ministry of Textile. Petitioner had taken up specific objection before the Labour Court in its written statement that N.T.C. (U.P.) is a corporation of Central Government, hence appropriate Government in respect of all disputes with regard to the employees, is Central Government. The Labour Court did not record any finding as to the maintainability of reference under Section 4-K of the Act. The Co-ordinate Bench of this Court in National Textile Corporation (supra) held as under:-

"11. The Apex Court in its judgment in Steel Authority of India v. National Union Waterfront Workers and Ors., 2001 (7) SCC 1 had occasion to consider the import of the word "appropriate Government" as defined in Section 2(1)(a) of Contract Labour (Regulation and Abolition) Act, 1970. The definition of the word "appropriate Government" under Section 2(1)(a) of the said Act is on similar line. The Apex Court after considering all earlier cases laid down following in paragraph 125 :

"125. The upshot of the above discussion is outlined thus :

(1) (a) Before 28.1.1986, the determination of the question whether the Central Government or the State Government is the appropriate Government in relation to an establishment, will depend, in view of the definition of the expression "appropriate Government" as stood in the C.L.R.A. Act, on the answer to a further question, is the industry under consideration carried on by or under the authority of Central Government or does it pertain to any specified controlled industry, or the establishment of any railway, cantonment board, major port, mine or oilfield or the establishment of banking or insurance company? If the answer is in the affirmative, the Central Government will be the appropriate Government; otherwise in relation to any other establishment the Government of the State in which the establishment was situated would be the appropriate Government.

(b) After the said date in view of the new definition of that expression, the answer to the question referred to above, has to be found in Clause (a) of Section 2 of the Industrial Disputes Act; if (i) the Central Government company/undertaking concerned or any undertaking concerned is included therein as co-nominee, or (ii) any industry is carried on (a) by or under the authority of the Central Government, or (b) by a railway company; or (c) by a specified controlled industry, then the Central Government will be the appropriate Government ; otherwise in relation to any other establishment, the Government of the State in which that other establishment is situated, will be the appropriate Government."

12. The judgment of the Apex Court relied by counsel for the Petitioners in Hindustan Aeronautics Ltd. case (supra), do support the contention raised by counsel for the Petitioners. Relying on Constitution Bench judgment of Apex Court in Steel Authority of India's case (supra), following has been laid down :

The question that arises for consideration in this case is, whether the High Court is justified in holding that the State Government is the "Appropriate Government" under the provisions of the relevant Act. The Constitution Bench recently has considered the relevant provisions of the Contract Labour Regulation Act in the case of Steel Authority of India and Ors. v. National Union Waterfront Workers and Ors.,(2001) 7 SCC 1: (2001 Lab IC 3656, and has come to the conclusion that the "Appropriate Government" will be the Government which exercises control and authority over the concerned organisation. It is undisputed that the Hindustan Aeronautics Ltd. is an undertaking of the Central Government and it is the Central Government which exercises full control over the same. Issuance of licence by the State Government is no criteria to come to a conclusion that the State Government would be the "Appropriate Government". The impugned judgment of the High Court therefore is, on the fact of it, erroneous in view of the Constitution Bench decision of this Court referred to earlier. We, therefore, set aside the impugned judgment of the High Court and hold that the Central Government is the 'Appropriate Government'."

13. Considering the facts and circumstances of the case, I find that the State was not competent to make the reference under Section 4-K of the Act, and the Labour Court before proceeding to make an award should have decided the objection raised by the petitioner as to the maintainability of the same.

14. As the issue raised by the petitioner having attained the finality, this Court finds that the award passed by the Labour Court, Kanpur is against the dictum of the Apex Court in case of Steel Authority of India (supra), Hindustan Aeronautics Ltd. (supra) and decision of Co-ordinate Bench of this Court in case of National Textiles Corporation (supra).

15. The award dated 16.05.1998 is unsustainable in the eyes of law and the same is, hereby, set aside.

16. Writ petition succeeds and is, hereby, allowed.

Order Date :- 08.02.2023

SK Goswami

[Rohit Ranjan Agarwal, J.]