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Standard Vacuum Oil ... v. Industrial Tribunal,...
Factual and Procedural Background
The applicant company, a stockist and distributor of petrol in Ernakulam, faced an incident in July 1948 where petrol was taken from their stock without their knowledge using a company lorry. A police prosecution for theft ensued against several employees, including respondents 2, 3, and 4, who were charged with involvement. All accused were suspended pending trial and subsequently acquitted. While other accused were reinstated, the company discharged respondents 2, 3, and 4 based on an internal enquiry and confessions. These respondents challenged their discharge as unjustified. The Government of Travancore-Cochin (5th respondent) issued an order under Section 10(i)(c) of the Industrial Disputes Act, 1947, referring the dispute concerning the justifiability of the discharge to the Industrial Tribunal, Ernakulam, for adjudication. The Tribunal initiated proceedings No. 11/1950 pursuant to this reference. The applicant company filed an application for a writ of certiorari to quash these proceedings and the reference order.
Legal Issues Presented
- Whether there existed an industrial dispute within the meaning of the Industrial Disputes Act, 1947, justifying the Government's reference for adjudication.
- If such a dispute existed, whether it was between the company and its workmen, given that respondents 2, 3, and 4 had ceased to be workmen at the time of the dispute.
- Whether the Government's reference order and the Tribunal's proceedings were ultra vires and unauthorized in the absence of a valid industrial dispute.
Arguments of the Parties
Applicant's Arguments
- The dispute was not an industrial dispute as defined by the Industrial Disputes Act but was purely an individual dispute.
- The dispute was not between the company and its workmen because respondents 2, 3, and 4 had ceased to be workmen at the time it arose.
- In the absence of a valid industrial dispute or a dispute between employer and workmen, the Government's reference was ultra vires and the Tribunal's proceedings unauthorized and illegal.
Respondents' Arguments
- The dispute, though individual initially, became collective when taken up by the Mineral Oil Workers' Union and supported by the Labour Department's intervention.
- The refusal of the company to reinstate respondents 2, 3, and 4 justified the reference as an industrial dispute.
- Respondents 2, 3, and 4 remained workmen as their discharge occurred after the dispute arose.
- The applicant company had submitted to the Tribunal's jurisdiction by appearing before it, barring this application.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| Kandan Textile Ltd. v. The Industrial Tribunal Madras (1949) 2 Mad LJ 789 | Interpretation that an individual dispute is excluded from the definition of "industrial dispute" under the Industrial Disputes Act. | The Court respectfully agreed with this precedent, holding that the dispute in question was not an industrial dispute because it remained individual. |
| Manager United Commercial Bank Ltd., Madurai v. Commissioner of Labour, Madras AIR 1951 Mad 141 | Detailed discussion excluding individual disputes from the ambit of industrial disputes under the Act. | The Court relied on this decision to support the conclusion that the dispute was not collective and thus not an industrial dispute. |
| J. Choudhary v. M.C Banerjee, 55 Cal WN 256 | Support for the view that individual disputes do not constitute industrial disputes under the Act. | The Court followed this precedent to reinforce its finding that the Government's reference was without jurisdiction. |
Court's Reasoning and Analysis
The Court first examined whether an industrial dispute existed, as this was a prerequisite for the Government's power to refer the matter for adjudication under Section 10(i)(c) of the Industrial Disputes Act, 1947. The Court analyzed the statutory definition of "industrial dispute" and noted that while the language could be interpreted broadly to include disputes involving one or a few workmen, the context and scheme of the Act, especially Section 18, indicated that an industrial dispute must be collective in nature.
The Court observed that an individual dispute may become collective if taken up by a union or a sufficient number of workers, but a dispute that remains individual throughout cannot be classified as an industrial dispute. It scrutinized the Government's order of reference, which explicitly described the dispute as between the employer and the three named individuals, indicating no change to a collective dispute despite the union's involvement.
Relying on authoritative precedents from the Madras and Calcutta High Courts, the Court concurred with the view that individual disputes are excluded from the definition of industrial disputes under the Act. Consequently, the Court held that the Government's reference was without foundation and thus ultra vires. As a result, the Tribunal's proceedings initiated on that reference were also unauthorized and void.
The Court further rejected the respondents' contention that the applicant's appearance before the Tribunal precluded jurisdictional challenge, holding that jurisdiction cannot be conferred by consent where it is inherently lacking.
Holding and Implications
The Court held that the Government's reference of the dispute to the Industrial Tribunal was ultra vires and without jurisdiction, and accordingly quashed the reference order and all proceedings arising therefrom.
The direct consequence is that the Industrial Tribunal must cease any further proceedings related to the reference. The Court awarded costs against the respondents in favor of the applicant. No new legal precedent was established beyond affirming existing interpretations of the Industrial Disputes Act's definition of "industrial dispute" as excluding purely individual disputes.
1. This is an application for a writ of certiorari to bring up and quash the proceedings in adjudication No. 11 of 1950 on the file of the first respondent, the Industrial Tribunal, Ernakulam, and for the incidental orders or directions under Article 226(i) of the Constitution of India.
2. The facts are these. The applicant Company are the stockists and distributors of petrol in Ernakulam. In July 1948 a quantity of petrol from their stock was taken out in a lorry belonging to, but without the knowledge of the company. A prosecution for theft at the instance of the police ensued. The third respondent was charged with having driven the lorry, and respondents 2 and 4 were charged with having taken the quantity of petrol from out of the company's stock. Respondents 2, 3 and 4 were employees under the company. There were some other accused in the case who were also the company's employees. All the accused were placed under suspension pending the trial. The prosecution ended in the acquittal of all the accused. The company took the other accused back into service, but having regard to the fact disclosed at the enquiry conducted by them as also to the confessions made by respondents 2 and 3, the company were satisfied about their participation in the matter and refused to take back respondents 2, 3 and 4 and discharged them. On a complaint made by these respondents that their discharge was unjustified the Government of the State of Travancore-Cochin (5th respondent) made the following order:
“L4-8057/50.DD.
Whereas an Industrial dispute has arisen between the Standard Vacuum Oil Company Ernakulam, represented by their Terminal Superintendent, Ernakulam, and their workmen viz., Sri C.P Sukumara Menon, Povothil House, Thrikkanarvattom, Ernakulam. Sri Thakkeveettil Ouseph Xavier, Mariyattuparambu, Pachalam, Ernakulam, and Sri Mecheri Thommen Devassy, Choolakal Parambu, Thrikkanarvattum, Ernakulam, in respect of matters mentioned in the annexure to this order:
And whereas in the opinion of Government, it is necessary to refer the said Industrial dispute for adjudication;
Now, therefore, in exercise of the powers conferred by Section 10(i)(c) of the Industrial Disputes Act 1947 (Central Act XIV(14) of 1947) Government hereby direct that the said industrial dispute be referred for adjudication to the Industrial Tribunal, Ernakulam, having its place of sitting at Ernakulam.
ANNEXURE.
Whether the discharge of Sri C.P Sukumara Menon, Sri T.O Xavier and Sri M.T Devassy is justifiable? If not, to what relief are they entitled?”
3. The first respondent accordingly started the aforesaid proceedings No. 11/1950.
4. The contentions urged on behalf of the applicant are (i) that there was no industrial dispute within the meaning of the Industrial Disputes Act XIV(14) of 1947 and that the dispute is purely individual; and (2) that even such dispute was not between the company and their workmen because by the time the dispute arose respondents 2, 3 and 4 had ceased to be workmen under the company. It is argued that in the absence of any one of these, the reference would be ultra vires the Government and that proceedings started by the Tribunal pursuant thereto would be unauthorized and illegal.
5. The respondents replied by saying that though the dispute was individual at the inception it changed its character because the cause was taken up by the Mineral Oil Workers' Union at whose instance the Labour Department of the State intervened, secured re-instatement of the rest and the reference for adjudication was the result of the refusal of the company to reinstate these three. It is, therefore, contended that there is an industrial dispute, justifying the reference. Respondents 2, 3 and 4 are claimed to be workmen as their discharge was after the dispute arose. Respondents raise a further point that the applicant has submitted to the jurisdiction of the Tribunal by having appeared before it & that therefore this application cannot be maintained.
6. The first question to be considered is whether there was an industrial dispute because in its absence the authority of the Government to refer for adjudication will not arise and cannot be exercised.
7. Section 10 of the Industrial Disputes Act provides:
“10. Reference of disputes to Boards, Courts or Tribunals:
(i) If any industrial dispute exists or is apprehended, the appropriate Government may, by order in writing:
(a) …………………..
(b) ……………………
(c) refer the dispute to a Tribunal for adjudication……………and industrial dispute has been defined in the Act thus:
“2. (k) “industrial Dispute” means any dispute or difference between employers and employers, or between employers and workmen, or between workmen and workmen, which is connected with the employment or non-employment or the terms of employment or with the conditions of labour, of any person;”
8. The contention urged on behalf of the respondents is that in view of the provisions of the General Clauses Act, the definition would comprise a dispute between the employer and one or a few only of the workmen. The language of the definition is certainly susceptible of the wide interpretation suggested. The definition has however to be understood and interpreted with reference to the context. Regard being had to the scheme of the Act in the light of the indications afforded by the provisions contained in S. 18, it is clear that the wide interpretation contended for cannot be justified and that the true meaning of an industrial dispute is that it should be a collective dispute. A dispute pertaining to an individual workman may if taken up by all the others or a sufficient number of them or by a labour union become collective and therefore an industrial dispute. But a dispute which at the inception is an individual one and continues to be such cannot be regarded as an industrial dispute within the meaning of the Act justifying a reference for adjudication to a Tribunal. In this case the contention urged on behalf of the respondents is that the dispute had so developed and become a collective dispute. Reliance is placed upon the interference of the Mineral Oil Factory Workers' Union. That such interference had not the effect of creating any change in the character of the dispute and did not operate to make it a collective one is clear from the order of Government read above. The order says:
“Whereas an Industrial dispute has arisen between the Standard Vacuum Oil Company Ernakulam, represented by their Terminal Superintendent, Ernakulam and their workmen viz., Sri C.P Sukumara Menon, Poovathil House, Sri Thekkeveettil Ouseph Xavier…………and Sri Mecheril Thomman Devassy………………..”
making it clear that the dispute at the time of the order was one between the employer company and the three specified individuals who were discharged workmen. Had the alleged interference of the Union any effect upon the nature of the dispute and had it operated to convert what was individual into a collective dispute then the order would have referred to the dispute in its changed aspect as a collective dispute and would not have mentioned it as even then being one individually appertaining to the three named workmen and who alone were parties concerned therewith. In the face of the order of Government which is clear upon this matter a contention that the dispute in question was one other than of the nature adumbrated therein cannot be raised or countenanced. The question as to whether an individual dispute will come within the meaning of the definition of ‘Industrial Dispute’ in the Act has been considered by the Madras High Court in two cases, ‘Kandan Textile Ltd. v. The Industrial Tribunal Madras’, (1949) 2 Mad LJ 789 and ‘Manager United Commercial Bank Ltd., Mathurai v. Commissioner of Labour, Madras’, AIR 1951 Mad 141, wherein the learned Chief Justice & two Judges of the Madras High Court have discussed the matter in great detail and reached the conclusion that a proper interpretation of the definition would exclude an individual dispute from the ambit of an industrial dispute in the Act. This view has been followed by the Calcutta High Court in ‘J. Choudhary v. M.C Banerjee’, 55 Cal WN 256. In the face of the learned discussions of the question in the aforesaid cases it is unnecessary to, embark upon any elaboration here and I consider it sufficient to record my respectful agreement with the view taken therein.
9. It follows that the order passed by Government referring the dispute indicated in the annexture to the order read above is devoid of foundation there having been no industrial dispute whose existence is essential. I hold that the order of reference is ‘ultra vires’ the Government and the proceedings started by the first respondent Tribunal on the foot of that reference are also ‘ultra vires’. A ‘writ of certiorari’ should therefore go and the order of deference as also the proceedings started by the first respondent on the foot of that reference should be quashed as having been passed and started without jurisdiction. The 1st respondent is directed to forbear from proceeding further upon that reference. As the application succeeds upon the first of the points taken it is unnecessary to consider the other point urged on that behalf. The want of jurisdiction of the first respondent Tribunal is inherent and in such a case, jurisdiction cannot be conferred by consent. The appearance by the applicant before the Tribunal has not the effect of preventing them from challenging the proceedings which are ‘ultra vires’.
10. The respondents will pay the costs of the applicant with Advocate's fee Rs. 100/-.
11. Order & proceedings quashed.
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