Bombay High Court
Bombay Hospital Trust vs Rajesh R Chavan And 44 Ors on 6 September, 2023
Bench: N. J. Jamadar
2023:BHC-OS:9528
WP4845-2022.DOC
Santosh
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL CIVIL JURISDICTION
WRIT PETITION NO. 4845 OF 2022
Bombay Hospital Trust
12-New Marine Lines,
Mumbai-400 020 ...Petitioner
Versus
1 Rajesh R. Chavan
Old Sambhaji Nagar, Behind
Mumbadevi, Saint Anthony Road,
Chembur, Mumbai - 400 007
2 Vinayak P. Chavan
3 Prashant S. Agre
4 Archana A. Pawar
5 Rakeshkumar J. Walmiki
6 Pankaj Chavan
7 Mahesh Walmiki
8 Mahendra Bakul
9 Vijay Chajlana
10 Vinod Yadav
11 Savita Zende
12 Bipin Chavan
13 Sagita Rewaskar
14 Vinod Jadhav
15 Sunil Rajbhar
16 Dilip Shinde
17 Narendra Chalke
18 Rakeshkumar Walmiki
19 Supriya Mohite
20 Deepakumar Kehar
21 Shrinivas Pakhare
22 Meena Gotamya
23 Anil Padave
24 Suman Kamble
25 Anilkumar Walmiki
26 Deepak Chauhan
27 Chotelal Ram
28 Vinesh Chauhan
29 Lata Maprolkar
30 Dinesh Chavan
1/29
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31 Jogendra Pawar
32 Ramdas Walmiki
33 Rekha Solanki
34 Ranjeet Walmiki
35 Vimala Kuvekar
36 Jitendra Walmiki
37 Jaichand Barkhairaliya
38 Dipika Jadhav
39 Laxmi Varma
40 Sangita Salvi
41 Jyoti Kamble
42 Kashmiri Parmar
43 Ashis Lohar
44 Bharati Smt. V. Bariya
45 Bharatiya Kamgar Sena ...Respondents
Mr. Sudhir Talsania, Senior Counsel, a/w N. B. Jalota, Netaji
Gawde and Rahul Sanghvi, i/b Sanjay Udeshi and Co.,
for the Petitioner.
Mr. Arshad Shaikh, Senior Counsel, i/b Rahul Oak, for
respondent Nos.1 to 6, 8 to 11, 13 to 18, 20, 21, 23, 26 to
28, 30, 31, 37, 38, 41, 43 and 44.
Mr. Kiran Bapat, Senior Counsel, a/w Gaurav Gawande, i/b
Desai and Desai Asso., for Respondent No.45.
CORAM: N. J. JAMADAR, J.
RESERVED ON : 2nd MAY, 2023
PRONOUNCED ON: 6th SEPTEMBER, 2023
JUDGMENT:-
1. Rule. Rule made returnable forthwith and with the
consent of the learned Counsel for the parties heard finally.
2. By this petition under Article 226 of the Constitution of
India, the petitioner calls in question the legality, propriety and
correctness of an order dated 20th February, 2021 on an
application for disposal of the complaint (ULP) No.398 of 2017,
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whereby the said application came to be rejected and a further
order dated 7th April, 2022 passed by the learned Member,
Industrial Court, declining to review the said order.
3. Shorn of unnecessary details, the background facts can be
stated as under:
(a) The petitioner Trust runs Bombay Hospital. It
employees above 3000 employees in various categories such as
ward boys, nurses and accountants etc. Respondent Nos.1 to
44 are the badli employees, who were given employment in
various categories whenever a badli vacancy arose in the
petitioner's establishment. Bharatiya Kamgar Sena, respondent
No.45, is a recognized Union within the meaning of Section 3(17)
of the Maharashtra Recognition of Trade Unions and Prevention
of Unfair Labour Practices Act, 1971 ("the Act, 1971"),
functioning at the petitioner's establishment
(b) Respondent Nos.1 to 44 - the complainants filed a
complaint before the Industrial Court purportedly under Items
5, 6 and 9 of Schedule IV of the Act, 1971, inter alia, seeking
permanency from the dates wherefrom the respondents -
complainants claimed to have been employed with the petitioner.
(c) Since permanency was the principal relief, the
petitioner claimed a complaint of unfair labour practice under
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Item 6 Schedule IV of the Act, 1971, could have been filed only
by the recognized Union. Eventually, at the instance of the
petitioner, respondent No.45 - recognized Union came to be
impleaded in the said complaint.
(d) Respondents had taken out an application for
interim relief. By an order dated 3rd August, 2018, the learned
Member, Industrial Court declared that the petitioner had,
prima facie, indulged in unfair labour practice under Items 5, 6
and 9 of the Schedule IV of the Act, 1971, directed the petitioner
to continue the complaint Nos.1 to 44 as per the then prevailing
practice till the disposal of the complaint and also consider
grant of permanency to the complainants on the basis of
seniority list of badli workmen while signing the settlement with
the recognized union.
(e) The recognized union had already raised a Charter of
Demand. On 21st January, 2020, the petitioner reached a
settlement with respondent No.45 - the recognized union on the
pending Charter of Demands. The petitioner claimed one of the
demands settled under the said settlement was that of grant of
permanency for the badli employees employed with the
petitioner's establishment and the settlement would necessarily
include the grant of permanency to respondent Nos.1 to 44 also.
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(f) Asserting that the prayer in the complaint stood
granted, as a result of 21st January, 2020 settlement arrived at
between the petitioner and recognized union, and no fruitful
purpose would be served in prosecuting the complaint, the
petitioner preferred an application (Exibit-C8) seeking disposal
of the complaint.
(g) Respondent Nos.1 to 44 resisted the said application
contending, inter alia, that the complainants - workmen were
not members of any of the Union and they were not extended
the benefit of the alleged settlement and, therefore, the alleged
settlement, which was executed contrary to the provisions of
Maharashtra Industrial Employment (Standing Orders) Rules,
1959, in respect of permanency, was not binding on the
complainants. It was denied that the said settlement records
and sets out the criteria - conditions for grant of permanency to
badli workmen including complainant Nos.1 to 44. The
proposed settlement wherein badli workmen were to be made
temporary employee and thereafter permanent was contrary to
Clause 4-C of Maharashtra Industrial Employment (Standing
Orders) Rules, 1959, which governs the petitioner's
establishment and, thus, the said allegedly illegal settlement
was not binding on the complainants.
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(h) The learned Member, Industrial Court, after
appraisal of the application (Exhibit C-8), reply thereto and the
material on record was persuaded to reject the application and
also direct the petitioner to adduce evidence to facilitate an
expedite decision on the complaint on its own merit. The
learned Member was of the view that, prima facie, it appeared
that while signing the settlement, the petitioner and the
recognized union did not consider the provisions of Rule 4-C of
the Model Standing orders. It was noted that out of 44
complainants, few of the complainants were considered by the
petitioners in terms of the directions of the Court and no
provision was made under the settlement qua rest of the
complainants. It was thus necessary to decide the complaint on
its own merits. The facts that the hearing in the complaint had
commenced, complainants had adduced their evidence and the
matter had been posted for the evidence of the petitioner -
employer, also weighed with the learned Member, Industrial
Court, in declining to dispose of the complaint, for the reason
that a settlement was signed between the petitioner and
recognized union.
(i) The petitioner sought review of the aforesaid order by
filing Review Application (ULP) No.7 of 2021. The complainants
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resisted the review. It was, inter alia, contended that there was
neither any error apparent on the face of the record nor any
sufficient ground to review the earlier order. It was also
contended that the Industrial Court was not conferred with the
power to review its order under the governing enactment.
(j) By an order dated 7th April, 2022, the learned
Member, Industrial Court, rejected the application for review
finding no justifiable ground to exercise the review jurisdiction.
Neither the review was warranted on account any defect in
procedure nor there was any patent error. The Industrial Court
again noted that the complaint was posted for cross-
examination of petitioner's witness and it was desirable for the
petitioner to keep its witness present for cross-examination and
proceed with the hearing and disposal of the complaint.
4. Being aggrieved, the petitioner has preferred this petition.
5. I have heard Mr. Talsania, the learned Senior Advocate for
the petitioner, Mr. Bapat, the learned Senior Advocate for
respondent No.45 - recognized Union and Mr. Shaikh, the
learned Senior Advocate for respondent Nos.1 to 6, 8 to11, 13 to
18, 20, 21, 23, 26 to 28, 30, 31, 37, 38, 41, 43 and 44 at some
length. With the assistance of the learned Counsel for the
parties, I have carefully perused the material on record.
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6. Mr. Talsania, the learned Senior Advocate for the
petitioner, submitted that with the settlement having been
arrived at between the petitioner and the recognized Union,
inter alia, providing for grant of permanency, in a structured
manner, there was no propriety in continuing with the instant
complaint. Mr. Talsania laid emphasis on the fact that the
principal relief claimed by the complainant was that of
permanency. In fact, by way of interim order, the learned
Member, Industrial Court, had directed the petitioner to
consider the complainants in the matter of grant of permanency.
The petitioner adhered to the said direction and made a
provision for the same in the settlement arrived at between the
petitioner and the recognized Union. Resultantly, nothing
survived for adjudication in the complaint. The learned
Member, Industrial Court, therefore, ought to have allowed the
application and disposed of the complaint which, in a sense,
became infructuous on account of subsequent developments.
7. Mr. Talsania would urge that the objection sought to be
raised on behalf of the complainants to the disposal of the said
complaint was based on an incorrect premise that the terms of
the settlement were not beneficial and lawful. If that is the case,
according to Mr. Talsania, a complaint of unfair labour practice
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is not the remedy. Such a grievance can only be made by
raising another industrial dispute. In the instant complaint,
however, the complainants cannot be permitted to assail the
legality, propriety and correctness of the settlement arrived at
between the petitioner and recognized Union. In any event, the
said settlement binds all the workmen on the establishment of
the petitioner and it is not open for the complainants to
question the same.
8. Mr. Bapat, the learned Senior Advocate for respondent
No.45 - recognized Union, sought to lend support to the
submissions of Mr. Talsania. It was submitted that once a
recognized Union is impleaded as a party to the proceedings no
workmen is entitled to be represented in such proceedings,
other than the one in which the legality or propriety of an order
of dismissal, discharge, removal, retrenchment, termination of
service or suspension of an employee is under consideration,
expect by such recognized union. Mr. Bapat would further urge
that in view of the provisions contained in Section 21 of the Act,
1971 no employee in an undertaking to which the provisions of
ID Act, 1947, apply shall be allowed to appear or act or be
represented in any proceedings relating to unfair labour
practices specified in Item Nos.2 and 6 of Schedule IV of the Act,
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1971, expect through the recognized Union. Since the principal
relief in the instant complaint falls under Item 6 of Schedule IV,
the complaint at the instance of respondent Nos.1 to 44 has not
been properly constituted, submitted Mr. Bapat.
9. Mr. Bapat would further urge that the legal position is no
longer res integra and settled by the decision of the Supreme
Court in the case of Maharashtra State Road Transport
Corporation and another vs. Casteribe Rajya Parivahan
Karmachari Sanghatna1, wherein it was enunciated that it is
only the recognized Union which has been empowered to
espouse the cause relating to unfair labour practices specified in
Items 2 and 6 of Schedule IV and unrecognized Unions are not
competent to file such a complaint.
10. Lastly, Mr. Bapat would submit, once a settlement is
signed between the employer and recognized Union that should
be the end of the matter. Such a settlement binds all the
parties including the workmen, who were employed in the
establishment to which the dispute relates on the date of the
dispute and all the persons, who subsequently join that
establishment under Section 18(3)(d) of the ID Act, 1947. Mr.
Bapat supplemented the submission of Mr. Talsania that if the
1 2009(8) SCC 556.
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complainants are aggrieved by the said settlement, that can, at
best, be a subject matter of a fresh industrial dispute.
11. Mr. Shaikh, the learned Senior Advocate for the
complainants, stoutly controverted the aforesaid submissions
canvassed on behalf of the employer and the recognized Union.
At the outset, it was submitted that there is neither any error in
jurisdiction nor procedural defect in the impugned orders and,
therefore, the impugned orders do not deserve to be interfered
with in exercise of writ jurisdiction. If the industrial adjudicator
has committed an error within jurisdiction leading to an
incorrect order, such error is not capable of correction in
exercise of writ jurisdiction submitted Mr. Shaikh. Nextly, it was
submitted by Mr. Shaikh that so far as the impugned order
declining to review the earlier order rejecting the application for
disposal of the complaint, no fault can be found with. The
learned Member, Industrial Court, has kept in view and
correctly applied the principles of review and finding no error
apparent on the face of the record or any other sufficient cause,
declined to exercise review jurisdiction. Such an order,
according to Mr. Shaikh, cannot be assailed in a writ petition.
12. On the issue of the tenability of the complaint at the
instance of the complainants, Mr. Shaikh submitted that the
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contention of the petitioner and respondent No.45 that the
complaint is under Item 6 of Schedule IV, is misconceived.
Since the employer has committed breach of Model Standing
Orders the complaint squarely falls within the ambit of Item 9 of
Schedule IV as it covers the breach of statutory provision. Mr.
Shaikh would further urge that though the application for
disposal of the complaint for the stated reason of the settlement
appears innocuous at the first blush yet the consequences of
the dismissal of the complaint, which include vacation of
interim order, would be termination of the complainants.
Therefore, the learned Member, Industrial Court, was justified in
refusing to dispose the complaint.
13. Lastly, Mr. Shaikh would urge that a settlement to have a
binding efficacy under Section 18 of the ID Act, 1947 must be in
conformity with the statutory provisions. A settlement which is
contrary to the applicable standing orders cannot be pressed
into service to deny the benefit of the statutory provisions.
Inviting the attention of the Court to the settlement, Mr. Shaikh
submitted that under the terms of the settlement no
permanancy is granted to any of the complainants.
14. Mr. Talsania joined the issue by submitting that the
grievance of the complainants is in respect of the terms of the
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settlement rather than that of an unfair labour practice. Placing
a strong reliance on the decision of the Supreme Court in the
case of State of Uttaraanchal vs. Jagpal Singh Tyagi2, Mr.
Talsania reiterated that such a grievance can be a matter of
another industrial dispute. In the said case, the Supreme Court
held that if there was a dispute on the question as to whether
the settlement was bona fide or was obtained by fraud,
misrepresentation or concealment of facts, the same can only be
the subject matter of another industrial dispute. The Supreme
Court relied upon its previous pronouncement in the case of
National Engineering Industries Ltd. vs. State of Rajasthan 3,
wherein it was observed as under:
"Settlement is arrived at by the free will of the parties and is
a pointer to there being goodwill between them. When there
is a dispute that the settlement is not bona fide in nature or
that it has been arrived at on account of fraud,
misrepresentation or concealment of facts or even corruption
and other inducements it could be the subject-matter of yet
another industrial dispute which an appropriate Government
may refer for adjudication after examining the allegations as
there is underlying assumption that he settlement reached
with the help of the Conciliation Officer must be fair and
reasonable."
(emphasis supplied)
15. Mr. Talsania would further urge that the submission that
the settlement is not lawful as it is in breach of the Model
Standing Orders is wholly misconceived. It was submitted that
2 (2005) 8 SCC 49.
3 (2000)1 SCC 371.
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Clause 32 of the Model Standing Orders overrides Clause 4-C as
it provides that nothing contained in these Standing Orders
shall operate in derogation of, inter alia, settlement or award
applicable to the establishment. To buttress this submission
Mr. Talsania placed reliance on a Division Bench judgment of
this Court in the case of Pune Municipal Corporation and
others vs. Dhananjay Prabhakar Gokhale.4 In the said case, it
was enunciated that once it was indisputable that under the
valid and lawful settlement the employees had agreed with the
employer that their claim for permanency would be available
only on completion of five years continuous service and
depending upon the availability of permanent vacant posts duly
approved by the Government, no claim under Clause 4-C of the
Model Standing Orders ignoring the settlement arrived at,
between the parties, can be entertained.
16. I have given anxious consideration to the aforesaid rival
submissions.
17. To begin with the nature of the complaint filed by
respondent Nos.1 to 44 - the complainant - employees. The
substance of the complaint purportedly under Items 5, 6 and 9
of Schedule IV of the Act, 1971 is that the complainant -
4 2006 (4) Mh.L.J. 66.
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employees have been working with petitioner No.1 Hospital for
years together on clear and permanent vacancies and yet they
have been treated as badli workers and deprived of the status of
permanancy. Complainant - employees thus prayed that it be
declared that the employer - petitioner has committed and/or
continuing to commit unfair labour practice, direct it to cease
and desist from engaging in unfair labour practice and also
sought allied reliefs.
18. In the said complaint, the complainant - employees took
out an application for interim relief (Exhibit-U2). By an order
dated 30th August, 2018, the learned Member, Industrial Court,
allowed the application directing the petitioner - employer to
continue complainant Nos.1 to 44 as per prevailing practice and
also to consider the claim of permanency of the complainant -
employees on the basis of seniority list of badli workmen while
signing the settlement with the recognized Union. It appears
that the said interim order has not been assailed.
19. The petitioner, however, asserts that in view of the
settlement arrived at between the employer and the recognized
Union under Section 2(p) read with Section 18(1) of the ID Act,
1947 and signed on 21st January, 2020 post aforesaid interim
order which binds all the workmen including the complainant -
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employees there is no justification for further adjudication of the
complaint. The petitioner also asserts that since the compliant
is primarily under Item 6 of Schedule IV, such complaint can
only be filed by recognized Union and which, in the instant case,
is a party to the said settlement, the complaint becomes
untenable.
20. Item Nos.5, 6 and 9 of Schedule IV of the Act, 1971 under
which the complaint has been filed, read as under:
"5. To show favouritism or partiality to one set of workers,
regardless of merits.
6. To employ employees as "badlis", casuals or
temporaries and to continue them as such for yers, with the
object of depriving them of the status and privileges of
permanent employees.
9. Failure to implement award, settlement or agreement."
21. Section 21 of the Act, 1971 governs the locus to institute
proceedings relating to unfair labour practices specified in Items
2 and 6 of Schedule IV. It reads as under:
"S.21 Right to appear or act in proceedings relating to
certain unfair labour practices: (1) No employee in an
undertaking to which the provisions of the Central Act for
the time being apply, shall be allowed to appear or act or
allowed to be represented in any proceedings relating to
unfair labour practices specified in items 2 and 6 of
Schedule IV of this Act except through the recognized union:
Provided that, where there is no recognized union to
appear, the employee may himself appear or act in any
proceeding relating to any such unfair labour practices.
(2) Notwithstanding anything contained in the
Bombay Act, no employee in any industry to which the
provisions of the Bombay Act, for the time being apply, shall
be allowed to appear or act or allowed to be represented in
any proceeding relating to unfair labour practices specified
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in items 2 and 6 of Schedule IV of this Act except through
the representative of employees entitled to appear under
Section 30 of the Bombay Act."
22. A bare reading of Section 21(1) of the Act, 1971 would
indicate that where a certificate of recognition is issued to a
Union under Chapter III of the Act, 1971, in relation to an
undertaking, no employee in such undertaking to which the
provisions of the ID Act, 1947 apply, shall be allowed to appear
or act or be represented in the proceedings where unfair labour
practices specified in Items 2 and 6 of Schedule IV are alleged,
save and except through such recognized Union.
23. Mr. Bapat, the learned Senior Advocate for the recognized
Union - respondent - complainant No.44 was justified in
banking upon the pronouncement of the Supreme Court in the
case of Casteribe (supra), wherein the Supreme Court
enunciated that Section 21 creates a bar qua an unrecognized
Union from acting, appearing or representing any employees in
a proceeding relating to unfair labour practices under Items 2
and 6 of Schedule IV and right to represent the employees, in
the said matter, is exclusively available to the recognized Union
and none else.
24. The aforesaid proposition, however, in the facts of the case
at hand does not seem to advance the cause of the submission
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of either employer or recognized Union. Indisputably, pursuant
to an order passed by the Industrial Court on 14 th February,
2018, Bharatiya Kamgar Sena, the recognized Union, came to be
impleaded as complainant No.45; a co-complainant. Thus, on
the date of the interim order dated 30 th August, 2018, the
recognized Union was espousing the cause of the complainant
employees, though reluctantly. The defect, if any, in the
institution of the complaint alleging unfair labour practice
under Item 6 of Schedule IV, thus stood rectified with the
impleadment of the recognized Union as a co-complainant. In
my considered view, it is now not open for either the employer or
the recognized Union to assail the tenability of the complaint on
the count of bar under Section 21 of the Act, 1971, at this
intermediatery stage.
25. In the light of the aforesaid view, which I am persuaded to
take, I do not deem it appropriate to delve into the submissions
of Mr. Shaikh that the unfair labour practices attributed to the
employer fall within the ambit of Item 9 of Schedule IV as well
and, therefore, the complainant employees can very well seek
redressal of the grievances on account of those unfair labour
practices.
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26. This leads me to the thrust of the challenge to the
impugned order dated 20th February, 2021 on the count that the
settlement having been arrived at under Section 2(p) read with
Section 18(1) of the ID Act, 1947 between the employer and the
recognized Union, it renders the complaint wholly untenable
and infructuous as the settlement equally binds the
complainant employees. As noted above, a two-pronged
submission was canvassed. One, if the complainant employees
are aggrieved by the terms of the settlement, as such, the proper
course is to raise another industrial dispute and not a
complaint of unfair labour practice under the Act, 1971. Two,
the foundational premise of the complainant employees that the
settlement is in breach of statutory provision especially Clause
4-C of the Model Standing Orders is legally unsustainanable as
under Clause 32 of the Model Standing Orders the provisions
therein do not operate to the prejudice of, inter alia, any
settlement applicable to the establishment.
27. In order to properly appreciate the aforesaid submissions
in the context of the facts of the case, it may be apposite to note
the provisions of Standing Orders and the terms of the
settlement signed between the employer and recognized Union
on 21st January, 2020.
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28. Clause 4-C of the Model Standing Orders reads as under:
"4-C. A badli or temporary workman who has put in 190
days' uninterrupted service in the aggregate in any
establishment of seasonal nature or 240 days "uninterrupted
service" in the aggregate in any other establishment, during
a period of preceding twelve calendar months, shall be made
permanent in that establishment by order in writing signed
by the Manager, or any person authorised in that behalf by
the Manager, irrespective of whether or not his name is on
the muster roll of the establishment throughout the period
of the said twelve calendar months."
29. Clause 32 of the Model Standing Orders reads as under:
"32. Nothing contained in these Standing Orders shall
operate in derogation of any law for the time being in force
or to the prejudice of any right under a contract of service,
custom or usage or an agreement, settlement or award
applicable to the establishment."
30. Clause 1 of the Memorandum of Settlement (Exhibit-F to
the petition) reads as under:
"Clause 1 Applicability: The provisions of this settlement
shall be applicable to all permanent workmen in scale of pay
LT, L1 to L5 and C1 to C5, who are on the pay roll of the
Hospital on the date of signing of this Settlement as well as
those permanent workmen who may be subsequently
employed on the roll of the Hospital at 12, New Marine Lines,
Mumbai: 400 020 in the above mentioned pay scale. The
benefits under this settlement shall not be applicable to
Probationer, temporary, casual, badli, trainee, contract
workmen and apprentice including apprentices engages
under Apprentices Act, 1961 etc. or on any workmen who are
employed on a consolidated monthly, fortnightly, weekly, daily
rated or tenure post including part time employee/workmen
on salary/wages."
31. The clause providing for conversion of badli workmen, with
which we are primarily concerned, reads as under:
"28. Age Of Superannuation:-
...........
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Conversion of Badli Workmen as Temporary Workmen:
It is agreed between the parties that notwithstanding the
order dated 30th August, 2018 of Industrial Court, Mumbai,
the Badli Workmen whose names are shown in Annexure "C"
hereto shall be given the status of temporary workmen of the
Hospial w.e.f. the dates shown against their names as per
the prevailing practice in the Hospital for number of years.
These workmen will continue to be hold status of temporary
workmen for the period of three years from the date of their
enrollment in the temporary category. It is further agreed
that the status of temporary workmen shall be enrolled from
status of Badli Workmen subject to fulfilling the following
criteria/conditions:
Criteria:
Each Badli Workman should have worked for actual 240
days in a period of 12 months excluding weekly off for a
period of two years preceding to date of enrollment of
temporary status.
..........
All the Badli workmen who are party to the matter pending
in the Industrial Court Complaint No.(ULP) 398 of 2017 shall
immediately within a period of seven days initiate the steps
to withdraw the matter from the Industrial Court."
32. A "settlement" is defined under Section 2(p) of the ID Act,
1947 as under:
"Section 2(p): "settlement" means a settlement arrived at in
the course of conciliation proceeding and includes a written
agreement between the employer and workmen arrived at
otherwise than in the course of conciliation proceeding
where such agreement has been signed by the parties
thereto in such manner as may be prescribed and a copy
hereof has been sent to [an officer authorised in this behalf
by] the appropriate Government and the conciliation
officer;].
33. Section 18 of the ID Act, 1947, which governs the binding
efficacy of the settlement and awards reads as under:
"18. Persons on whom settlements and awards are
binding.-[(1) 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.
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[Provided that, where there is recognized union for any
undertaking under any law for the time being in force, than
such agreement (not being an agreement in respect of
dismissal, discharge, removal, retrenchment, termination of
service, or suspension of an employee) shall be arrived at
between the employer and the recognized union only; and
such agreement shall be binding on all persons referred to
in clause (c) and clause (d) of sub-section (3) of this section.]
(2) [Subject to the provisions of sub-section (3), an
arbitration award] which has become enforceable shall be
binding on the parties to the agreement who referred the
dispute to arbitration.]
[(3) A settlement arrived at in the course of conciliation
proceedings under this Act [or an arbitration award in a
case where a notification has been issued under sub-section
(3A) of section 10A] or [an arbitration award in case where
there is a recognized union for any undertaking under any
law for the time being in force] or [an award [of a Labour
Court, Tribunal or National Tribunal] which has become
enforceable] shall be binding on-
(a) all parties to the industrial dispute;
(b) all other parties summoned to appear in the
proceedings as parties to the dispute, unless the Board,
[arbitrator,] [Labour Court, Tribunal or National Tribunal],
as the case may be, records the opinion that they were so
summoned without proper cause;
(c) where a party referred to in clause (a) or clause (b) is
an employer, his heirs, successors or assigns in respect of
the establishment to which the dispute relates;
(d) where a party referred to in clause (a) or clause (b) is
composed of workmen, all persons who were employed in
the establishment or part of the establishment, as the case
may be, to which the dispute relates on the date of the
dispute and all persons who subsequently become employed
in that establishment or part."
34. A settlement, as is evident, can be arrived at in two modes.
First, a settlement arrived at in the course of conciliation
proceeding. By its very nature, where the settlement is arrived
at before the conciliation officer, a degree of sanctity is attached
to such settlement. Second, a settlement arrived at otherwise
than in the course of conciliation proceeding, where an
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agreement has been signed by and between the employer and
the workmen, in such manner, as may be prescribed and a copy
thereof has been sent to the appropriate Government and the
conciliation officer. Under Section 18(1), a settlement arrived at
between employer and the workmen otherwise than in the
course of conciliation proceeding binds the parties to the
agreement. The proviso to Section 18(1) envisages that where
there is a recognized union for any undertaking then such
agreement, not being an agreement in respect of dismissal,
discharge, removal, retrenchment, termination of service, or
suspension of an employee, shall be arrived at between the
employer and the recognized Union only and such agreement
shall be binding on all persons referred to in clauses (c) and (d)
of sub-section (3) of the said Section. Under Clause (c) of sub-
section (3) the settlement binds the heirs, successors or
assignees of the employer. Under Clause (d) the settlement
binds all persons, who were employed in the establishment or
part of the establishment, as the case may be, to which the
dispute relates on the date of the dispute and all persons, who
subsequently become employed in that establishment or part.
35. The statutory provisions as to the binding efficacy of the
settlement especially when arrived at between the employer and
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recognized union are abundantly clear. However, the recognized
union cannot arrogate unto itself the authority to enter into the
settlement de hors its nature and consequences. The proviso to
Section 18(1) contains an inbuilt guarantee of protecting the
interest of an employee by carving out an exception in case of an
agreement adversely affecting the interest of the employee by
providing for dismissal, discharge, removal, retrenchment,
termination of service or suspension of an employee. Therefore,
the consequence of the settlement, either direct or indirect,
becomes germane while testing the legality and propriety of the
settlement. Even otherwise, the settlement cannot, on first
principles, be in flagrant violation of the statutory mandate.
36. In the case of Workmen of M/s. Delhi Cloth General Mills
Ltd. vs. The Management of M/s. Delhi Gloth and General Mills
Ltd.5, on which reliance was placed by Mr. Shaikh, the Supreme
Court observed that the management and the union even when
a dispute is referred to a conciliation officer, cannot claim
absolute freedom of contract to arrive at a settlement in all
respects. The settlement has to be in compliance with the
statutory provisions. The observations of the Supreme Court in
paragraph 15 are instructive and, hence, extracted below:
5 AIR 1970 Supreme Court 1851.
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"15. The respondent's learned Advocate in reply obliquely
suggested in this connection that the Management and the
Union were free to arrive at a settlement of their dispute and
if they agreed to do so then the agreement could not but be
held to be binding. We do not think the Management and the
Union can, when a dispute is referred to the Conciliation
Officer, claim absolute freedom of contract to arrive at a
settlement in all respects binding on all workmen, to which
no objection whatsoever can ever be raised by the workmen
feeling aggrieved. The question of a valid and binding
settlement in such circumstances, is in our opinion,
governed by the statute and the rules made thereunder.
Reliance was next placed on S. 18(1) to support the binding
character of the settlement. This sub-section for its pro- per
construction must be read with the other sub-sections and
the relevant rules, in the light of the definition of 'settlement'
as contained in S. 2(p) of the Industrial Disputes Act.
'Settlement' as defined therein means settlement arrived at in
the course of conciliation proceeding and includes a written
agreement between the employer and workmen arrived at
otherwise than in the course of conciliation proceeding where
such agreement has been signed by the parties thereto in
such manner as may be prescribed and a copy thereof has
been sent to the appropriate Government and the
Conciliation Officer. In the light of these provisions we do not
think that S.18(1) vests in the Management and the Union
unfettered freedom to settle the dispute as they please and
clothe it with a binding effect on all workmen or even on all
member workmen of the Union. The settlement has to be in
compliance with the statutory provisions.
(emphasis supplied)
37. I am mindful of the fact that neither in the complaint
before the Industrial Court nor in this petition, the question of
legality and validity of the settlement between the employer and
the recognized union can be delved into. Mr. Talsania was right
in submitting that the challenge to the settlement for being
illegal, or for that matter, mala fide, can be properly laid in an
industrial dispute. Reliance placed on the decision of the
Supreme Court in the case of Jagpal Singh Tyagi (supra), as a
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matter of principle, is well founded. However, the peculiar facts
of the case and the consequences which the termination of the
proceedings in the ULP complaint would entail cannot be lost
sight of.
38. The stipulations in the Memorandum of Settlement
especially as regards conversion of badli workmen as
temporary workmen extracted above on its plain reading
indicates that the status of "badli workmen" is agreed to be
upgraded to that of "temporary workmen" upon fulfillment of
certain conditions. Evidently, a new step in the ladder to
permanency is sought to be created. Under Clause 4-C of the
Standing Orders no distinction is made in the matter of
entitlement to conferment of permanency between a badli and
temporary workmen. Item 6 of the Schedule IV also proscribes
employment of employees as badlis, casuals or temporaries and
their continuation as such for years with the object of depriving
them of the status and privilege of permanent employees.
39. For the determination of this petition, it is unwarranted to
embark upon an enquiry about the juridical connotation of
distinction between, "badli" and "temporary workmen".
Nonetheless, the fact remains that the complainant employees
claimed that they are entitled to the benefit and privilege of
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permanency for having rendered the requisite service as badli.
Clause 4-C of the Model Standing Orders lends support to their
claim. The complainant employees, therefore, cannot be
precluded from asserting that they are entitled to the benefit of
permanency while working as "badlis" and without being
upgraded or re-designated as "temporary workmen". In my
considered view, the settlement in question does not constitute
an impediment in pursuing the said claim.
40. As noted above, the validity of the settlement cannot be
gone into in this petition. What can certainly be enquired into
is the consequence of the termination of the proceedings in the
complaint. The learned Member, Industrial Court, noted that
out of 44 complainant - employees, the employer considered 12
employees for the benefit of the settlement. Rest of the
complainants were not extended any benefit under the
settlement. At this juncture, the scope of the interim order
passed by the Industrial Court dated 30th August, 2018 becomes
critical. By the said order, the Industrial Court directed the
employer to continue the complainant employees as per
prevailing practice till the disposal of the main complaint. Mr.
Shaikh was fully justified in canvassing the submission that the
moment the proceedings in the complaint are terminated, the
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aforesaid protection afforded to the complainant employees by
the interim order would come to an end. This consequence of
the termination of the complaint proceedings is self-evident and
cannot be lost sight of.
41. The stage of the proceedings also bears upon the
determination. The learned Member, Industrial Court, in the
original order noted that the complainants had led their
evidence and it was for the employer to adduce evidence. In the
order in review, the learned Member, Industrial Court, noted
that the matter was posted for cross-examination of the
employer's witnesses. As the proceedings in the complaint have
reached an advanced stage, the Industrial Court considered it
appropriate to adjudicate the complaint on merits. No fault can
be found with this approach.
42. The conspectus of aforesaid consideration is that the
Industrial Court in its original order dated 20 th February, 2021
committed no error in declining to dismiss the complaint on
account of the settlement signed between the employer and the
recognized union. It would be suffice to note that the finding of
the learned Member, Industrial Court, that no ground for review
of the original order was made out is factually correct and
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legally sound. Resultantly, no interference is warranted in
exercise of writ jurisdiction.
43. Hence, the following order:
:ORDER:
(i) The petition stands dismissed.
(ii) Rule stands discharged.
(iii) In the circumstances, there shall be no order as to
costs.
[N. J. JAMADAR, J.]
