Fdc Limited vs Union Of India (Uoi) And Ors.
2007 Latest Caselaw 24 Del

JUDGMENT

Shiv Narayan Dhingra, J.

Page 0228

1. By this writ petition, the petitioner has challenged the validity of notification dated 22.5.2001 issued by the Government of India, Ministry of Labour, whereby in exercise of powers conferred under Section 7B of the Industrial Disputes Act(in short 'the Act'), the Government constituted National Tribunal with Headquarters at Calcutta and referred the following dispute to the National Tribunal:

Whether the actions of the management in relation to FDC Ltd. in terminating the services of 58 medical representatives as given in Annexure are legal and justified? If not, to what relief are the medical representatives entitled to?

2. The names of the employees involved, their place of work and alleged date of termination are as under:

LIST OF TERMINATIONS:

        S/Sri
1. C. Valasukumar             Kannur          15.10.97
2. S. Ramesh                  Warangal        03.10.97
3. K. Patwari                 Kurnool         30.10.97
4. V. Chandrasekhar           Madurai         13.10.97
5. Bhaskar Thirumal           Mumbai          19.02.98
6. B. Saha                    Dibrugarh       20.09.97
7. Santosh Tiwari             Jabalpur        0.101.98
8. D.S Ahluwalia              Kanpur          0.107.97
9. M.S. Kanyal                Barelly         15.10.97
10. P. Nandakishore           Quilon          27.10.97
11. K.K. Dey                  Midnapur        15.10.97
12. S.J. Chakraborty          Agartala        05.01.98
13. Rakesh Nallui             Elluru          29.09.98
14. Rajat Mandal              Hqr. Patna      10.10.98
15.S.K. Ghosh                 Mushidabad      02.09.98
16. G. Nagrajan               Trunelveli      10.10.98
17. V. Selvamani              Salem            08.0998
     Page 0229
18. K. Sankaanama Sivyam      Erode           12.10.98
19. D.R. Samanata Roy         Bhubneswar      24.10.98
20. Subhasish Sengupta        Calcutta        24.10.98
21. Samrat Guha               Calcutta        24.10.98
22. S. Bera                   Calcutta        24.10.98
23. Sanjory Moitra            Calcutta        24.10.98
24. Debashish Kundu           Calcutta        24.10.98
25. C. Kesab Kumar            Trichur         24.10.98
26. D.K. Behera               Cuttak          07.08.98
27. V.K. Mishra               Faizabad        24.10.98
28. R.K. Bhateja              Sikar           07.12.98
29. A.K. Gupta                Raigha          08.05.98
30. Javed Kulla               Mumbai          07.12.98
31. Manish Sarawati           Jaipur       October, 98
32. K. Saibaba                Basti           16.02.99
33. S.M. Puranik              Dhule           27.09.99
34. J.D. Kulkarnai            Nashik          27.09.99
35. A.S. Gupta                Nashik          27.09.99
36. C.G.K. Ghokhle            Vijayawada      16.02.99
37. P. Suresh Babu            Guntur          26.02.99
38. Madhup Cocasse            Kota            05.12.98
39. Sanjeev Gaurav            Jaipur          07.12.98
40. Sanjoy Banerjee           Balasore        18.11.98
41. M.P. Mathur               Udaipur         07.12.98
42. Rajeeb Chugh              Srinagar        07.12.98
43. K.K. Jhoshi               Jodhpur         08.12.98
44. K. Kakkundi               Hubli           15.04.99
45. O.P. Yadav                Jaipur          08.12.98
46. Ajoy Kumar Singh          Jaunpur         16.03.99
47. Rajesh N. Mehta           Ahmedabad       10.05.99
48. B. Rajkumar               Mangalore       17.02.99
49. A.K. Laha                 Sambalpur       16.03.99
50. P.S. Das                  Samastipur      16.03.99
51. Rakesh Shukla             Sitamadhi       14.10.98
52. R.K. Khatri               Kota            10.05.99
53. Sudip Dasgupta            Calcutta        24.10.98
54. Sivendu Ghosh             Jamshedpur      07.12.98
55. Rakesh Singh              Ara             15.04.99
56. Shashank Sheode           Pune            05.10.99
57. Abhijit Dhondphale        Pune            05.10.99
58. Amitav Mukarjee           Hazaribagh      16.03.99

 

Page 0230
 

3. It is pleaded by the petitioner that the reference to National Tribunal was bad since the parties and record was spread all over the country. Each Medical Representative's case was based on his individual facts. It would be necessary for the concerned Medical Representatives (MRs) and the petitioner company to contest each MRs action and to appear before the Tribunal with witnesses and records. The reference to National Tribunal was made malafidely with ulterior motives.

4. The notification is also challenged on the ground that only a dispute of national importance can be referred to the national Tribunal or the dispute should be of such a nature in which the establishments situated in more than one state were likely to be interested or affected. Merely because the medical representatives of one establishment were working in more than one State, would not entitle the Government to refer the dispute to the National Tribunal. The petitioner was having a large number of employees. The petitioner came across instances of misconduct of different nature by different MRs and wherever the misconduct was of serious nature, the petitioner had taken disciplinary action including termination of services. Each Medical Representative raised an industrial dispute based on his facts and filed his own statement of claim before the Labour Court/Tribunal in various States. There was no common cause between different MRs except that they were facing action for misconduct. The reference to the National Tribunal was, therefore, not warranted. The dismissal of the Medical Representatives took place from 1997 to 1999. Out of 58 MRS, whose names are given above, as many as 24 did not raise any dispute. Four of them resigned and collected their dues. Two MRs were still in employment of the company. Services of 9 MRs were terminated during the probation period and 6 MRs during training period. Thus dispute in respect of 58 persons(MRs) has been referred by non application of mind. It is pleaded that even under Section 7B of the Industrial Disputes Act, power can be exercised only in a guided and rationale manner and not in an unguided and irrational manner. Section 7B of the I.D. Act requires due satisfaction of the Central Government as a pre condition for a valid reference to a National Tribunal and the impugned notification should sufficiently demonstrate that there was basis for forming such an opinion. The order of appointment of National Tribunal was without any basis or reasons. It caused prejudice not only to the petitioner but to several MRs spread out all over India. Every medical representative had already raised a dispute before the concerned State Tribunal and in some cases, the proceedings were pending while in some the awards had already been passed. There was no material before the Central Government to refer the matter to the National Tribunal.

5. In the counter, it is submitted by the Government that 58 MRs were terminated without paying retrenchment compensation or charge-sheeted. Non reference of the dispute would have sent wrong signals to the workmen and adversely affected the industrial relations in vital pharmaceuticals industries. While the management had a right to initiate disciplinary action, but such disciplinary action can only be taken against the employees after serving charge sheets and holding an enquiry. The prime concern of the Ministry of Labour was to give relief to the workmen who were spread over Page 0231 different states under jurisdiction of the State Industrial Tribunal. It is also submitted that if similar dispute was entertained by different industrial Tribunals, there was possibility of difference in opinions and possibility of deciding the issue in different manner and coming to different decisions, leading to different outcomes. So, the Central Government decided to refer the entire issue of termination to the National Tribunal. It is submitted that the dispute was indication of worsening industrial relations between the employer and employees and the issues and questions of natural justice were involved, therefore, the appropriate Government constituted the National Tribunal. Requirements of Section 7B of the I.D. Act were satisfied since the dispute had arisen in different States.

6. It is also submitted that the National Tribunal was constituted so that decision taken by different Industrial Tribunal of the States were harmonized. The National Tribunal was to consider the judgment passed by the State Industrial Tribunals and take into account the contentions raised by different MRs and then arrive at a final decision. Another reason which has been given for constituting the National Tribunal was that the National Tribunal was beyond the jurisdiction of High Courts under Articles 226 and 227 of the Constitution of India since it has the same status as that of High Court. Thus, the parties would not be able to take resort to Articles 226 and 227 of the Constitution of India. Regarding the inconvenience to the parties, it was submitted that though the National Tribunal had been constituted at Calcutta, because the presiding officer was to be of a status of a High Court Judge and only a Judge of Calcutta High Court was available, but the venue of the Tribunal may be changed at request from workers/union/employer, as per convenience of the parties. Those employees who had already raised the dispute before the State Tribunal and the State Tribunal was seized with the matters, such matters would be transferred to the National Tribunal in so far as they related to the same matter. Therefore, the possibility of different decisions would not arise. Since, the dispute related to industrial establishment in more than one State, therefore, the reference to a National Tribunal was justified.

7. I have heard learned Counsel for parties and perused the record. Section 7B of the Industrial Disputes Act reads as under:

National Tribunals.-(1). The Central Government may, by notification in the Official Gazette, constitute one or more National Industrial Tribunals for the adjudication of industrial disputes which, in the opinion of the Central Government, involve questions of national importance or are of such a nature that industrial establishments situated in more than one State are likely to be interested in, or affected by, such disputes.

(2) A National Tribunal shall consist of one person only to be appointed by the Central Government.

(3) A person shall not be qualified for appointment as the presiding Officer of a National Tribunal 2[unless he is, or has been, a Judge of a High Court].

(4) The Central Government may, if it so thinks fit, appoint two persons as assessors to advise the National Tribunal in the proceeding before it.

Page 0232

8. A perusal of the above Section would show that pre-requisite for constitution of National Tribunal are:

i.that the dispute involves question of national importance; or

ii.that the dispute is of such a nature in which industrial establishments situated in more than one State are likely to be interested or effected.

iii.The Central Government has formed an opinion that either of the above two situations was there.

9. Thus, the only ground which is available to the Central Government for issuance of notification under Section 7B of the I.D. Act is that a dispute involves question of national importance or that the industrial establishment of more than one State were likely to be interested in the dispute. The emphasis is on the nature of dispute only and its important character. It is obvious that if various workmen of one establishment spread over different States have been terminated for different reasons or misconducts and the cluster of disputes raised involve adjudication of the facts in respect of each individual workman, such disputes cannot be considered a single dispute of national importance. A dispute of national importance would be such where some important question of law is involved which is going to affect the fate of the workmen in general throughout India or fate of the employers throughout India. The adjudication of the individual dispute of different workmen cannot be referred to a National Tribunal because the workmen are spread over in different States. Only those questions of law can be referred to the National Tribunal which are of national importance in which either the workmen in general or of the industrial establishments in different States or the employers of the industries in different States, would be interested. Such a dispute may be a dispute which would determine the future course or future service conditions or future relationship of working class in general or the employers in general. Different establishments in different States does not mean that if one establishment has branches in different States, then all those branches can be treated as different establishment in different States. In fact that would be one establishment having branches or factories in different States. Here different establishments in different States would mean establishments of the same nature or diverse nature but they must not be of same group or family. Say an issue arises whether a hospital is an industry or not, or the research institute is an industry or not, this would be a dispute of national importance. Similarly, those issues in which the fate of an individual workman is not involved but the fate of large scale of identical or un-identical workmen is involved, such a dispute, would be a dispute of a national importance or a dispute where several establishments would be interested.

10. The Government, in the present case, has referred the dispute of 58 individuals, who were stationed in different States. By the notification, the Government has asked the workmen in different States to approach the Tribunal at one place in India i.e. Calcutta. Each individual MR was allegedly dismissed on different date in a different state for different set of facts. So, the adjudication will have to be done in respect of each individual separately. Asking an individual, who was appointed in Chandigarh to go to Calcutta or Page 0233 any other place in India for fighting his labour dispute, would be too much. Even if one union, represents all the MRs, whose disputes have been referred, the union would have to be totally depended upon the individual workman for representing his case before the Tribunal, since there is no question of law involved. Dismissal of a group of workmen cannot be considered an important question of law or a question of national importance. Moreover, the Government has failed to controvert the facts as stated in para 4 above about Twenty Four MRs not having raise dispute, four resigned and two MRs still in employment, nine terminated during probation and six during training period when reference was made.

11. The plea taken by the respondent in the counter that the National Tribunal has status of a High Court, is not correct. The National Tribunal and State Tribunals have same status. Both are industrial tribunals and a writ under Articles 226 and 227 of the Constitution of India lies against the decision of the National Tribunal as well.

12. It is apparent that there was no application of mind before passing the order. Although it is claimed that the order was passed by the Central Government for the benefit of the workmen but the order of the Government in fact would cause justice for the workmen more distant and expensive. There is no provision in law that each workman has to be provided traveling expenses when he travels for his case before the National Tribunal from far off places.

13. For the reasons stated above, I consider that the notification is liable to be set aside and is hereby set aside. The writ petition is allowed. No orders as to costs.