Central Group And Ors. vs Shri Motiram S. Thakare Through ...
2005 Latest Caselaw 53 Bom

JUDGMENT

R.M.S. Khandeparkar, J.

1. Heard the learned Advocates for the parties. Perused the records. Rule. By consent, the rule is made returnable forthwith, in both the petitions.

2. The following common questions of law arise for determination in both these petitions :

1. Whether the Labour Court can entertain the application under Section 33C(2) of the Industrial Disputes Act, 1947 in the absence of relationship of the employer-employee between the parties to the proceedings ?

2. Whether the Labour Court is entitled to decide the issue as to whether there exists relationship of the employer-employee between the parties as an incidental issue to the main proceedings under Section 33C(2) of the Industrial Disputes Act, 1947, hereinafter called as "the said Act."?

3. Placing reliance in the decisions of the Apex Court in the matters of The Central Bank of India Ltd. v. P.S. Rajagopalan etc., , the Central Inland Water Transport Corporation Limited v. The Workmen and Anr., , and Municipal Corporation of Delhi v. Ganesh Razak and Anr., as well as Tara and Ors. v. Director, Social Welfare and Ors., , the learned advocates for the petitioners submitted that when the claimant's status as the workman itself is denied by the opponents in the proceedings initiated by the claimant under Section 33C(2) of the said Act, the Labour Court is not entitled to decide the issue regarding status of the claimant as that of the workman under the said Act as an incidental issue to the main issue relating to the entitlement for the amount claimed by him and the Labour Court having totly ignored this well settled law has acted illegally while passing the impugned orders, and therefore, the same warrant interference.

4. The learned advocates for the respondents, on the other hand, placing reliance in the decision in the matter of R.B. Bansilal Ahirchand Mills Co. Ltd. v. The Labour Court, Nagpur and Ors., reported in 1972 I LLJ 231, a decision of the Division Bench of this Court in Ramakrishna Ramnath v. State of Maharashtra and Ors., reported in 1975 Mh.L.J. 212 as well as of unreported decision of the learned Single Judge of this Court in Writ Petition No. 1041 of 2004 in the matter of M/s. Central Grop and Ors. v. Narayangangaram Patil, delvered on 9th June, 2004, have submitted that the dispute in relation to the status of the claimant is an incidental one to the main issue of entitlement of the amount claimed, and therefore, is not outside the scope of the proceedings under Section 33C(2) of the said Act. Hence, no fault can be found with the impugned order.

5. Section 33C of the said Act deals with the subject of recovery of money due from an employee. Sub-section (1) thereof relates to the recovery of money due under or in respect of an award or settlement or lay off, retrenchment or closure compensation. Sub-section (2) thereof, with which we are concerned in the matter in hand, provides that where any workman is entitled to receive from the employer any money or any benefit which is capable of being computed in terms of money and if any question arises as to the amount of money due or as to the amount at which such beneit should be computed, then the question may, subject to any rules that may be made under the said Act, be decided by such Labour Court.

6. Rule 62 of the Industrial Disputes (Central) Rules 1957, relates to the procedure pertaining to the application for recovery of dues under Section 33-C of the said Act. Sub-rule (1) thereof relates to the application under Section 33-C(1) whereas sub-rule (2) thereof relates to the application under section 33-C(2). The said sub-rule (2) provides that where any workman or a group of workmen is entitled to receive from the employer any money or any benefit which is capable of being computed in terms of money, the workmen or the group of workmen, as the case may be, may apply to the specified Labour Court in Form K-3 for the determination of the amount due, or as the case may be, the amount at which such benefit should be computed. The prescribed Form K-3 reads thus:-

"Before the Central Government Labour Court at _________between______________and __________

(1) Name of the applicant(s)

(2) Name of the employer The petitioner(s)_______________ a workman of ____________ M/s._______________of ___________ is/are entitled to receive from the said M/s.___________the money/benefits mentioned in the statement hereto annexed.

It is prayed that the court be pleased to determine the amount/amounts due to the petitioner(s).

Signature or Thumb Impression(s) of the applicant(s) Address(es)

1.

2.

3.

4. Station : ______________ Date : ____________"

7. Plain reading of sub-section (2) of Section 33-C of the said Act clearly reveals that where any workman is entitled to receive from his employer any money or other benefits which are capable of being calculated in terms of money, but the question arises as to the quantum of such money or the money value, as the case may be, due from the employer on account of such entitlement to the workman, then the said question real decided by the Labour Court in exercise of its powers under the said provision of law. Rule 62(2) of the said Rules, which provides the procedure in that regard, requires the workman to file the application in the form K-3 as prescribed under the said Rules. The said form also clearly reveals that the relief which is to be sought in terms of Section 33-C(2) of the said Act is for determination of the amount due. In other words, it relates to the calculation of the amount of money due to the workman on account of his entitlement for the same. The scope of procedure under Section 33-C(2), however, does not relate to the dispute pertaining to the entitlement of the dues but it is restricted to the dispute pertaining to the calculation and qualification of the dues in terms of the entitlement already established on adjudication of that dispute by the competent authority. Besides, such claim for calculation of the money due has necessarily to be between the employer and the employee, whose relation of that nature must be either undisputed or undisputable.

8. In fact, the scope of powers of the Labour Court under section 33C(2) of the Industrial Disputes Act, 1947 had been the subject matter for discussion in number of cases. The Apex Court in Central Bank's case (supra) dealing with the scope of Section 33C(2) of the said Act held that the only point which the Labour Court can determine is one in relation to the computation of the benefit in terms of money. Further, considering the possibility of an employer merely denying the claim and raising dispute in that regard with a view to oust the jurisdiction of the Labour Court, it was observed that "before proceeding to compute the benefit in terms of money the Labour Court inevitably has to deal with the question as to whether the workman has a right to receive that benefit. If the said right is not disputed, nothing more needs to be done and the Labour Court can proceed to compute the value of the benefit in terms of money; but if the said right is disputed, the Labour Court must deal with that question and decide whether the workman has the right to receive the benefit as alleged by him and it is only if the Labour Court answers this point in favour of the workman that the next question of making the necessary computation can arise." It was further ruled that "the claim under Section 33C(2) clearly postulates that the determination of the question about computing the benefit in terms of money may, in some cases, have to be preceded by an enquiry into the existence of the right and such an enquiry must be held to be incidental to the main determination which has been assigned to the Labour Court by sub-sec.(2)." While describing the powers under Section 33C(2) of the said Act to be like those of the Executing Court, it was observed that "it is open to the Executing Court to interpret the decree for the purpose of execution. It is, of course, true that the executing Court cannot go behind the decree, nor can it add to or subtract from the provision of the decree. These limitations apply also to the Labour Court; but like the executing Court, the Labour Court would also be competent to interpret the award or settlement on which a workman bases his claim under S.33C(2)." At the same time, it was ruled that "if an employee is dismissed or demoted and it is his case that the dismissal or demotion is wrongful, it would not be open to him to make a claim for recovery of his salary or wages under Sec. 33-C(2)".

9. In Central Inland Water Transport Corporation's case (supra), the Apex Court while dealing with the comparison between the powers of the Industrial Tribunal under Section 10 of the said Act and of the Labour Court under Section 33C(2) of the said Act, it was held that under Section 10, the Tribunal would necessarily go into a detail investigation of the alleged right of the employees to be continued in service by the employer and would give relief in several forms depending on the facts and circumstances of each case and even direct re-employment with or without continuity of service and further direct payment of wages fully or partially, however, none of these things can be done by the Labour Court under Section 33C(2) of the said Act and all it can do is to compute the benefit if there is already an adjudication in favour of the workman against the employer. It was further held that "it would be impossible for the Labour Court to compute any benefit unless the Court, after considering all the matters which an Industrial Tribunal has to consider, ultimately decides upon one or the other of the several alternative reliefs which the Industrial Tribunal alone has a right to determine. By saying that the Labour Court would determine the alternative reliefs as 'incidental' to computation, one cannot conceal the fact that it is actually exercising the function of an Industrial Tribunal. The investigation is not 'incidental' to computation , but the computation itself is consequential upon the main finding as to the nature of relief the workmen are entitled to in an industrial dispute."

10. In Municipal Corporation of Delhi's case (supra), there was no prior adjudication by any forum regarding the claim of the workmen regarding the wages to be paid at the same rate at which regular workmen of the establishment were being paid, neither there was any award or settlement to that effect, the question was whether in those circumstances, the proceedings for computation of the arrears of wages claimed by the workmen were maintainable under Section 33C(2) of the said Act? After taking into consideration the decisions of the Apex Court in Central Bank of India's case (supra) as well as Bombay Gas Co. Ltd. v. Gopal Bhiva, and Chief Mining Engineer, East India Coal Co. Ltd. v. Rameswar, , it was held that "the ratio of these decisions clearly indicates that where the very basis of the claim or the entitlement of the workmen to a certain benefit is disputed, there being no earlier adjudication or recognition thereof by the employer, the dispute relating to entitlement is not incidental to the benefit claimed and is, therefore, clearly outside the scope of a proceeding under Section 33-C(2) of the Act. The Labour Court has no jurisdiction to first decide the workmen's entitlement and then proceed to compute the benefit so adjudicated on that basis in exercise of its power under Section 33-C(2) of the Act. It only when the entitlement has been earlier adjudicated or recognised by the employer and thereafter for the purpose of implementation or enforcement thereof some ambiguity requires interpretation that the interpretation is treated as incidental t the Labour Court's power under Section 33-C(2) like that of the Executing Court's power to interpret the decree for the purpose of its execution."

11. In Tara's case (supra), reiterating the ruling of the Municipal Corporation of Delhi's case (supra) and in the case where the status of the claimants as Anganwadi helpers was disputed, it was held that "this is obvious from the fact that the status and nature of employment of the appellants is itself disputed and unless there is a prior adjudication on merits of the status which is the foundation for making the claim for wages at the specified rates, the question f moving an application under Section 33-C(2) for computation of the wages does not arise."

12. Obviously, the ratio of all the relevant decisions on the point in issue was clearly culled out by the Apex Court itself in Municipal Corporation of Delhi's case (supra) and it clearly clarifies the limited scope of the powers of the Labour Court in the proceedings under Section 33C(2) of the said Act and that it relates merely to the computation of the dues based on prior adjudication or recognized or undisputed right of the employee and not otherwise and the power to deal with the incidental issues relates to interpretation of settlement or award arrived at the conclusion of such recognition or adjudication of the claim of the employee. But the Labour Court does not enjoy the power to decide about the status of the claimants approaching the Labour Court under the said provisions of law, nor the issue in relation to the status of the claimants can be said to be an incidental one.

13. It is to be noted that in Back's Law Dictionary, Vth Edition, the term "incidental" has been defined to mean that "depending upon or appertaining to something else as primary; something necessary, appertaining to, or depending upon another which is termed the principal, something incidental to the main purpose". The expression "incidental powers" therefore would mean those powers which a statute may confer upon the authority or the tribunal as are directly and immediately appropriate to the execution of the powers expressly granted to it and exist only to enable the authority to carry out the purpose of its creation. The expression "ancillary jurisdiction" is defined to mean the power of the Court to adjudicate and determine the matters incidental to the exercise of its primary jurisdiction of an action, whereas, the expression "ancillary proceedings" has been defined to mean growing out of or auxiliary to another action or sue or which is subordinate to or aid the primary action either at law or equity." In other words, the incidental issue can never be one which is in the form of "prelude" to the main issue but it has to be of the nature of "sequel" of the main issue. It has to be essentially so subordinate to or less important than or dependent on the main issue and not vice-versa. The issue relating to the status of the claimant as the workman is not dependent upon the issue of entitlement of the amount and on the contrary, the issue relating to entitlement of amount claimed depends upon the status of the claimant as that of the workman.

14. Considering the provisions of law, the scope of powers of the Court under Section 33-C(2) of the said Act and the law laid down by the Apex Court, therefore, it is apparent that the issue relating to the status of the claimant as being the workman or employee of the opponents in such proceedings cannot be adjudicated upon by the Labour Court in such proceedings on the assumption that such an issue is an incidental issue. In fact, the existence of employer-employee relationship is a jurisdictional fact, the existence of which is very much essential for the Labour Court to assume jurisdiction to deal with the proceedings under Section 33C(2) of the said Act. In the absence of such jurisdictional fact i.e. the existence of relationship of the employer-employee between the opponents and the claimant respectively, in such proceedings, either established in any other earlier proceedings or is not disputed or is not disputable on the face of the records, certainly the Labour Court would be entitled to deal with the claim under Section 33C(2) and not otherwise.

15. Undoubtedly, the Division Bench in Ramakrishna Ramnath's case (supra), while dealing with the issue as to whether the Labour Court can go into the question whether the claimant before it is a workman within the meaning of Section 2(s) of the said Act held that "it will be competent for the Labour Court under Section 33C(2) to inquire into the question whether the person invoking its jurisdiction is a 'workman' or not within the meaning of the said Act." However, in view of the Apex Court's decision in Tara's case (supra) on the point in issue, the decision in Ramakrishna Ramnath's case (supra) can no more be said to be laying down the correct proposition of law.

16. The decision in R.B. Bansilal Abirchand Mills' case (supra) is not on the point in issue. Therein it was ruled that the Labour Court's jurisdiction could not be ousted by a mere plea denying the workmen's claim to the compensation of the benefit in terms of money, and the Labour Court had to go into the question and determine whether on the facts, it had jurisdiction to make the computation. At the same time, it was observed that "It could not, however, give itself jurisdiction by a wrong decision on the jurisdiction plea." In other words, the Labour Court does enjoy jurisdiction to decide about the computation of the amount due to the workmen while dealing with the matter under Section 33C(2) but under the guise of determining the issue relating to computation of amount due, it cannot decide about the status of the claimant as being workmen.

17. The decision in Narayan Gangaram Patil's case apart from a bald statement denying employer-employee relationship, the pleadings and materials on record did not disclose severe dispute about the existence of such relationship as well as right of the workmen. In any case, the point regarding absence of jurisdiction to decide the issue relating to the status of the applicant as workman while dealing with the application under Section 33C(2) has been well settled by the above referred decisions of the Apex Court.

18. It is, therefore, to be held that the Labour Court while dealing with the application under Section 33C(2) of the Industrial Disputes Act, 1947, cannot deal with the issue relating to the status of the applicant as the workman and such an issue is not an incidental issue in such proceedings but it relates to jurisdictional fact and in the absence of such jurisdictional fact, the Court is not empowered to entertain the application under Section 33C(2) of the said Act.

19. At the same time, it is to be noted that merely because the status has been disputed, that by itself will not oust the jurisdiction to entertain the application under Section 33C(2). In each case, the Labour Court will have to see whether there is dispute about the status of the applicant as workman and if the materials placed before it disclose either no such dispute exists or at any stage there was admission in that regard by the employer or adjudication of such issue by the competent Court and yet it is sought to be disputed, certainly in that case it would cease to be the main issue and on the contrary in those circumstances there would be an occasion to deal with the same as an incidental issue, since it would be the case of mere attempt to non-suit the applicant on an issue which does not exist for adjudication between the parties.

20. The facts of the case in Writ Petition No. 2353 of 2003 reveal that the Labour Court has by its order dated 18th November, 2002, directed the petitioners to pay to the respondent an amount of Rs.1,83,631/- towards overtime wages, leave wages and bonus to the respondent. The respondent claiming to be the employee of the petitioner-company filed the application under Section 33C(2) of the said Act being Application (IDA) No. 212 of 1999. It is the case of the respondent that even though he was employed with the petitioners on agreement to render services for 8 hours per day on monthly wages of Rs.1900/-he was made to work for 12 hours per day without any payment for overtime service rendered by him, and that he was not granted other benefits like leave wages and bonus. The petitioners contested the proceedings by filing written statement inter alia raising the plea that there was no employer employee relationship between the petitioners and the respondent and that therefore the application under Section 33C(2) of the said Act was not maintainable. The Labour Court, after hearing the parties, however, rejected the contention of the petitioners and held that the Labour Court has jurisdiction to decide the incidental question relating to the relationship of the employer-employee between the opponents and the applicant in the proceedings under Section 33C(2) of the said Act and in the facts of the case, such relationship being established, the petitioners are liable to pay the amount as directed under the impugned order.

21. Apparently there was not a mere denial of employer-employee relationship but also the very right to claim the dues and benefits was disputed and denied. Obviously, the claim of the respondent was in the capacity as the employee of the petitioners and further that he was made to work for 12 hours per day contrary to the terms of employment and on that count being entitled to claim the overtime wages and secondly that no leave wages and bonus were paid. The said claim was specifically denied by the petitioners. Undisputedly, the respondent apart from bare claim in respect of being employed for 12 hours or that on that count no dues were paid or that no leave wages or bonus were paid, no material in support of such claim was produced either along with the application or even during the investigation. When the very claim was denied and the applicant was not able to place on record any material in support of such claim, it was apparent that the very right to claim dues and benefits was in dispute and admittedly there was no prior adjudication in respect thereof, nor any settlement or admission on the part of the petitioners placed on record. Obviously, therefore, in terms of law on the point, the Labour Court could not have proceeded to adjudicate the issue relating to the status of the applicant and also regarding the right of the respondent, as the same was squarely beyond the scope of powers of the Labour Court under Section 33-C(2) of the said Act. Besides, the Labour Court also erred in holding that such issues are incidental to the main issue under section 33-C(2). Hence, the impugned order cannot be sustained and is liable to be set aside, and the application under Section 33-C(2) of the said Act is liable to be dismissed.

22. In the Writ Petition No. 7458 of 2004 are that the petitioners challenge the order dated 23rd June, 2004 passed by the Labour Court in similar application under Section 33-C(2) of the said Act. The said Application being No. 60 of 2002 came to be filed by the respondent claiming that he had not been paid from July 1994 to June 2001 the overtime wages amounting to Rs.1,55,400/-even though he was made to work for 12 hours per day and was terminated from the services on 3rd July, 2001. The claim in the application was related to overtime wages for 4 hours per day. The petitioners, while disputing the employer-employee relationship, admitted that the respondent had rendered service for 8 hours per day but denied the claim for overtime wages contending that he had never rendered such service.

23. Obviously, the denial of employer employee relationship in the said case was apparently without any substance and the pleadings of the petitioner in answer to the application of the respondent apparently revealed existence of such relationship and the admission in that regard. Being so, there is no substance in the contention regarding absence of such relationship. The point however is whether the respondent was able to disclose the right to claim overtime wages. Admittedly, there was neither any admission in that regard nor adjudication of any such right of the respondent by the competent Court. The dispute does not relate merely to the calculation of the quantum of money due but it relates to the very liability of the employer and right of the claimant to claim overtime wages. Undisputedly, there was no adjudication by the competent authority or the Court regarding entitlement of the respondent-workman for overtime wages and/or whether the respondent had at all rendered overtime service. Undisputedly, the registers produced on record did not disclose the overtime service having been rendered by the workman. Indeed, the Labour Court merely on assumption that since there were only two watchmen, each one of them might have been working for 12 hours, has held that the respondent/workman is entitled to get the double benefits. Obviously, the Labour Court has exceeded its jurisdiction while dealing with the matter under Section 33-C(2) of the said Act, and therefore, the impugned order cannot be sustained and is liable to be quashed and set aside and the application under Section 33-C(2) of the said Act, for the reasons stated above, are liable to be dismissed.

24. In the result, therefore, both the petitions succeed. For the reasons stated above, the impugned orders are hereby quashed and set aside. The applications under Section 33-C(2) of the said Act are hereby dismissed. In both the petitions, rule is made absolute in above terms with no order as to costs.