AMICUS AI
Citation Codes
Neutral Citations
2005 INSC 344
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • The Industrial Disputes Act, 1947 (in short “the ID Act”)
  • ID Act (no specific section/subsection/year mentioned)
  • Administrative Tribunals Act, 1985 (the Act)
  • Article 309 of the Constitution
  • Article 226 or under Section 19 of the Administrative Tribunals Act and then avail of the right under Article 136 of the Constitution
  • Section 10(1) of the ID Act
  • Section 10(1) of the Act
  • Section 5, Subsection 2 of the 1983 Income Tax Act
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Cites
Cited by
Citation Codes
Neutral Citations
2005 INSC 344
Equivalent Citations
citation codes
Case Number
Disposition
Attorney(S)
Judges
Acts
  • The Industrial Disputes Act, 1947 (in short “the ID Act”)
  • ID Act (no specific section/subsection/year mentioned)
  • Administrative Tribunals Act, 1985 (the Act)
  • Article 309 of the Constitution
  • Article 226 or under Section 19 of the Administrative Tribunals Act and then avail of the right under Article 136 of the Constitution
  • Section 10(1) of the ID Act
  • Section 10(1) of the Act
  • Section 5, Subsection 2 of the 1983 Income Tax Act
Smart Summary

Factual and Procedural Background

The appellants were employees working in canteens maintained by the Departmental Canteen Committee of Mahanagar Telephone Nigam Limited (MTNL). After their services were terminated, the Government of India, Ministry of Labour, referred the dispute to the Central Government Industrial Tribunal No. II (CGIT) under Section 10(1) of the Industrial Disputes Act, 1947 (ID Act). CGIT rejected a preliminary objection raised by MTNL that the employees were holders of civil posts and, therefore, outside the purview of the ID Act. CGIT ordered reinstatement with continuity of service and back wages.

MTNL challenged the award before a Single Judge of the Bombay High Court, who dismissed the writ petitions. On letters patent appeals, a Division Bench of the High Court reversed the Single Judge, holding that the employees held civil posts and must pursue their remedies before the Central Administrative Tribunal (CAT) under the Administrative Tribunals Act, 1985. The present appeals before the Supreme Court question the Division Bench’s decision.

Legal Issues Presented

  1. Whether employees holding civil posts under the Central Government can invoke the Industrial Disputes Act, 1947, and pursue a reference before CGIT.
  2. Whether the CGIT lacked jurisdiction in view of the notification dated 11-12-1979 and the corresponding office memorandum declaring all departmental canteen posts to be civil posts.
  3. The effect of the three-Judge Bench decision in G.M., Telecom v. A. Srinivasa Rao (1997 8 SCC 767) on the maintainability of the reference.

Arguments of the Parties

Appellants' Arguments

  • The three-Judge Bench in G.M., Telecom has already recognised MTNL as an “industry”, validating the reference to CGIT.
  • Even assuming the appellants hold civil posts, they remain “workmen” of an industry and may choose any available forum, including CGIT.

Respondents' Arguments

  • G.M., Telecom did not determine whether holders of civil posts must approach CAT rather than CGIT.
  • The 11-12-1979 notification and subsequent office memorandum expressly exclude departmental canteen employees from the ID Act; therefore CGIT had no jurisdiction.
  • The proper forum for such employees is the Central Administrative Tribunal under the Administrative Tribunals Act, 1985.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
G.M., Telecom v. A. Srinivasa Rao (1997 8 SCC 767) Held that earlier views declaring “telecom industry” not to be an “industry” were incorrect. Relied on by appellants to support CGIT jurisdiction; Court noted it did not address the civil-post/CAT issue.
Bombay Telephone Canteen Employees' Assn. v. Union of India (1997 6 SCC 723) Observed that employees admitted to hold civil posts must seek remedy under CAT or Article 226; ID Tribunal jurisdiction excluded. Quoted by Supreme Court to illustrate that CGIT jurisdiction stands excluded when employees hold civil posts.
Sub-Divisional Inspector of Post v. Theyyam Joseph (1996 8 SCC 489) Held Postal Department not an “industry.” Mentioned as a decision whose view on “industry” was disapproved in G.M., Telecom.

Court's Reasoning and Analysis

The Supreme Court observed that G.M., Telecom did not adjudicate the precise question now arising—whether holders of civil posts may nevertheless seek relief under the ID Act. Moreover, the impact of the 11-12-1979 notification and related office memorandum, which classify departmental canteen posts as civil posts connected with the affairs of the Union, was not examined in that case. The Court emphasised that the legality of these instruments remains unchallenged.

Referring to paragraph 13 of Bombay Telephone Canteen Employees' Assn., the Court noted a clear statement that once employees are admitted to hold civil posts, jurisdiction of the Industrial Tribunal is excluded and remedies lie under Article 226 of the Constitution or before the CAT.

Given these considerations, and recognising that the matter involves a substantial question not concluded by existing precedent, the bench deemed it appropriate to place the appeals before a larger bench for an authoritative determination.

Holding and Implications

ORDER: The appeals are referred for hearing by a three-Judge Bench; papers to be placed before the Hon’ble Chief Justice of India for appropriate directions.

Implications: No final adjudication on merits was made. The Supreme Court signalled the need for a larger bench to resolve whether civil-post holders may invoke the ID Act. The immediate effect is deferment of the parties’ dispute until a three-Judge Bench delivers a conclusive ruling; no new precedent has yet been established.

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    Umesh Korga Bhandari v. Mahanagar Telephone Nigam Ltd. And Others

    Arijit Pasayat, J.— Challenge in these appeals is to the correctness of the judgment rendered by a Division Bench of the Bombay High Court allowing the letters patent appeal filed by the Mahanagar Telephone Nigam Limited (in short “MTNL”), Respondent 1. The appellants were working in the canteens maintained by the Departmental Canteen Committee. The appellants questioned the legality of termination of their services. The Government of India, Ministry of Labour, referred the matter for adjudication by the Central Government Industrial Tribunal No. II, Bombay (in short “CGIT”). Preliminary objection was raised by the present respondents on the ground that the workmen concerned were holding civil posts of the Central Government and, therefore, the Industrial Disputes Act, 1947 (in short “the ID Act”) has no application. CGIT did not accept this stand and held that the action of the Departmental Canteen Committee in terminating the services of the appellants was not justified. Direction was given to reinstate the appellants in service in the same capacity from the date of retrenchment. The respondents were also directed to treat them in continuous service and to pay back wages. CGIT's orders were questioned before the Bombay High Court by filing writ petitions. The learned Single Judge dismissed the writ petitions holding that Respondent 1 MTNL had been held to be an industry and, therefore, without following the provisions of the ID Act, termination could not have been directed. The letters patent appeals were filed before the Bombay High Court. By the impugned judgment, the High Court held that the reference under Section 10(1) of the ID Act was not maintainable. It was noted that the present appellants were holding civil posts. Reference was made to the notification dated 11-12-1979 which, inter alia, stated that all posts in the canteens and tiffin rooms run departmentally in the Central Government offices or establishments are civil posts and the incumbents would qualify as holders of civil posts under the Central Government. Necessary rules under the proviso to Article 309 of the Constitution were framed and published in the Official Gazette on 7-7-1981. As the present appellants were holding civil posts, the only forum to adjudicate their grievance was the Central Administrative Tribunal (in short “the Administrative Tribunal”) constituted under the Administrative Tribunals Act, 1985 (in short “the Act”) and not CGIT. The present appeals have been filed questioning the correctness of the judgment of the High Court. It was submitted that a three-Judge Bench of this Court in G.M, Telecom v. A. Srinivasa Rao (1997) 8 SCC 767 has held that the views expressed in Bombay Telephone Canteen Employees' Assn. v. Union of India (1997) 6 SCC 723, AIR 1997 SC 2817 were not correctly decided. It was held that the view expressed that the “telecom industry” is not an industry is not correct. A similar view was expressed about another decision in Sub-Divisional Inspector of Post v. Theyyam Joseph (1996) 8 SCC 489 wherein it was held that the Postal Department is not an “industry”. Both Theyyam Joseph (1997) 6 SCC 723, AIR 1997 SC 2817 and Bombay Telephone Canteen Employees' Assn. (1997) 8 SCC 767 were rendered by two-Judge Benches.

    2. Learned counsel for the appellants submitted that since it has been held by a three-Judge Bench that the Telephone Nigam is an industry, the reference made to CGIT and the adjudication by it was not without jurisdiction. In any event, as workmen of an industry, it was open to the appellants to seek relief from CGIT, even though, it is conceded for the sake of argument, that the appellants held civil posts. They were free to choose any of the forums available.

    3. In response, learned counsel for the respondents submitted that the question whether the present appellants could have moved CGIT and not the Administrative Tribunal was not decided by the three-Judge Bench in G.M, Telecom case. With reference to the office memorandum reiterating the decision contained in office memorandum (OM No. 6/41/73-Welfare) dated 18-12-1979, it was submitted that it has been provided in clear terms that the employees of the canteen do not come under the purview of the ID Act. The notification dated 11-12-1979 clearly indicated that all posts in the canteens and tiffin rooms run departmentally by the Government of India are in connection with the affairs of the Union. That being so, CGIT had no jurisdiction to deal with the matter and the appellants should have moved the Administrative Tribunal. According to him the effect of the notification and office memorandum was not considered.

    4. We find that in G.M, Telecom there was no adjudication of the question whether the holders of civil posts could move CGIT or the only forum to seek relief was the Administrative Tribunal. Further, the effect of the notification and office memorandum was not considered in the said case. Legality of the notification and office memorandum has not been questioned. In Bombay Telephone Canteen Employees' Assn. v. Union of India (1997) 8 SCC 767 in AIR para 11 this Court observed as follows:

    “13. On an overall view, we hold that the employees working in the statutory canteen, in view of the admission made in the counter-affidavit that they are holding civil posts and are being paid monthly salary and are employees, the necessary conclusion would be that the Tribunal has no jurisdiction to adjudicate the dispute on a reference under Section 10(1) of the Act. On the other hand, the remedy to approach the constitutional court under Article 226 is available. Equally, the remedy under Section 19 of the Administrative Tribunals Act is available. But, generally, the practice which has grown is to direct the citizen to avail of, in the first instance, the remedy under Article 226 or under Section 19 of the Administrative Tribunals Act and then avail of the right under Article 136 of the Constitution by special leave to this Court etc. Thus, in view of the admission made by the respondents in their counter-affidavit that the workmen of the appellant Association are holding civil posts and are being paid monthly wages and benefits and are considered to be employees, the jurisdiction of the Industrial Tribunal stands excluded. It is open to the aggrieved party to approach the appropriate authority in accordance with law. In that view, the finding of the Tribunal in the impugned judgment is legal and warrants no interference. It is open to the respondents to avail of such remedy as is available to a regular employee including the right to approach the Central Administrative Tribunal or the High Court or this Court thereafter for redressal of legal injury.”

    5. Question may arise as to whether the workman had a right to move the Industrial Tribunal. It is certainly not a right in the sense that it is within the discretion of the Government to make a reference or refuse it, of course for legally tenable reasons. On the contrary, under the Act there is no such restriction.

    6. The three-Judge Bench was not directly considering the questions involved in the present appeals. It cannot be said that the said decision has concluded the matter against the present respondents.

    7. We, therefore, think it proper to refer the matter for hearing by a three-Judge Bench. The basic issue to be considered by the three-Judge Bench would be whether a person holding civil post can seek relief under the ID Act on the basis that he was a workman.

    8. Let the papers be placed before the Hon'ble Chief Justice of India for appropriate directions.

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    Umesh Korga Bhandari v. Mahanagar Telephone Nigam Ltd. And Others
    (Aug 8, 2005)