The Judgment of the Court was delivered by

Sankar Prasad Mitra, C.J:— This is an appeal from a judgment of S.C Ghosh, J. dated 28 and 29 June, 1971. The appellant before us, in an application under Art. 226 of the Constitution, had challenged an order of reference, dated 27 October, 1969, by the State of West Bengal (respondent 3) to the Second Labour Court, West Bengal (respondent 1). The facts briefly are that on 25 August, 1965, a memorandum of settlement was arrived at, in course of conciliation proceedings, between Rivers Steam Navigation Company, Ltd., and the Central Steam Navigation Workers' Union. By this settlement, inter alia, the retirement age had been fixed and it had been provided that there would be no retrenchment of clerical staff for five years. The settlement was valid from 25 August, 1965 to 31 December, 1969, both days inclusive. Under S. 19(2) of the Industrial Disputes Act, 1947, this settlement, according to the respondents, shall continue to be binding on the parties after the expiry of the aforesaid period and until the expiry of two months from the date on which a notice in writing of an intention to terminate the settlement is given by one of the parties to the other party or parties to the settlement. In the instant case no notice in writing, the respondent-State, has been served.

2. On 22 February, 1967, the appellant, Central Inland Water Transport Corporation, Ltd., a company wholly owned by the Union of India was incorporated.

3. On 3 May, 1967, this Court, in its company jurisdiction, sanctioned a scheme of arrangement and compromise under the provisions of Ss. 391 and 394 of the Companies Act, 1956. By this order sanctioning the scheme all properties and assets of the Rivers Steam Navigation Company, Ltd., were transferred to and vested in the Central Inland Water Transport Corporation, Ltd. It was further ordered that

“upon the approval of the scheme by the honourable Court, the Rivers Steam Navigation Company, Ltd., shall be closed and upon payment to all creditors the Rivers Steam Navigation Company, Ltd. shall be dissolved without winding up pursuant to an order to be obtained from this honourable Court.”

4. On 3 May, 1967, the Managing Director of the Rivers Steam Navigation Company, Ltd., issued a notice as follows:

“Notice is hereby given that the entire undertaking of Rivers Steam Navigation Company, Ltd., in West Bengal, Assam and other places including the Dockyard, Ghats, etc, will be closed with immediate effect.

(ii) This closure is being effected in terms of the scheme sanctioned by the Calcutta High Court by its order, dated 3 May, 1967, and due to various circumstances placed before the said High Court including the stoppage of the through river transport service from Calcutta to Assam.

(iii) Such of the staff and workers of the company in all establishments of the company at Calcutta other than the Rajabagan Dockyard and Kulpi as have not already drawn their salaries for the month of April 1967, can do so at the company's head office at 4 Fairlie Place, Calcutta, between 1 and 5 p.m, either on 8 or 9 May, 1967. Workers and staff of the Rajabagan Dockyard and Kulpi workshop can similarly draw their salaries as may be due for the month of April during the same hours on 9 and 10 May at the Rajabagan Dockyard and Kulpi workshop, respectively. Workers and staff in Assam can draw their salaries as may be due for the month of April during the same hours on 9 and 10 May at the premises where they used to draw their salaries previously.”

5. An appeal was preferred against the judgment sanctioning the scheme. The trial Court made an observation that the substratum of the transferor-company had completely gone and the rights under the agreement between the transferor-company and its workers had been extinguished. But the Appellate Court, it appears, took a different view. A.N Ray, J., delivering the judgment of the Appellate Court in Indian Steam Navigation Workers' Union v. Rivers Steam Navigation Company, Ltd. [71 C.W.N 897] at pp. 908–909 observed:

“I am of opinion, that the questions

first, whether there is a closure of the company within the meaning of the Industrial Disputes Act,

secondly, whether the agreement, dated 25 August, 1965, is capable of enforcement,

thirdly, whether the workers or workmen are entitled to prefer and assert their claims on the agreement dated 25 August, 1965, and

fourthly, whether the Rivers Steam Navigation Company, Ltd., and the new transferee-company are entitled to assert that there has been a closure and further that the agreement is not capable of enforcement shall all be left open for the rival contentions to be pursued in the proper forum and on proper materials and in the proper jurisdiction.

Whether the agreement has the binding character or the agreement is binding or the agreement has ceased to be binding all these questions, in my opinion, should be left open for consideration in the event any claim is made or in the event of any defence being raised to such a claim.

I am of opinion that if any claim be made in the proper jurisdiction it will be a matter for enforcement of that claim in properly constituted proceeding. It is needless to say that unless there is adjudication there cannot be any enforcement of the claim and a such adjudication has to be made in a proper forum …”

6. The result, therefore, is that the Appellate Court did not give any decision as to the fate of the settlement after the scheme was sanctioned. The Appellate Court indicated that these matters were to be dealt with

“in a proper forum, on proper materials and in proper jurisdiction.”

There is no indication, however, as to which Court would have jurisdiction to adjudicate upon a dispute of this nature.

7. We have already observed that on 3 May, 1967, the Managing Director of the Rivers Steam Navigation Company, Ltd., issued a notice of closure of the company

“in terms of scheme sanctioned by the Calcutta High Court and due to various circumstances placed before the said High Court …”

The Appellate Court in its judgment referred to above in Indian Steam Navigation Workers' Union v. Rivers Steam Navigation Company, ltd. [71 C.W.N 897 at 911], at para. 27, observes:

“In the present case the scheme to which reference has been made shows that the Rivers Steam Navigation Company, Ltd., is reconstructed for certain purposes. It is discharging certain functions for a certain time until it will be dissolved …”

Ghosh, J., has stated that

“there was no closure of the old company at any time within the meaning of the Industrial Disputes Act” (vide p. 147 of the Paper Book).

But, in this judgment, we do not intend to express any view on this aspect of the matter which, on the facts of this case, should, if necessary, be decided by the Labour Court at the appropriate time.

8. Coming back on the facts of this case, on 12 September, 1968, the State of West Bengal made two orders of reference to the Labour Court under S. 33-C(2) of the Indus trial Disputes Act, 1947, at the instance of workmen represented by Inland Steam Navigation Workers' Union. These two references dealt respectively with

(a) the claims of some of the workers under the aforesaid settlement, and

(b) the claims of other workmen for retrenchment benefits under S. 25-FF of the Industrial Disputes Act, 1947.

In both the orders of reference the Central Inland Water Transport Company, Ltd., was described as the successor to Rivers Steam Navigation Company, Ltd.

9. These two orders of reference were challenged in an application under Art. 226 of the Constitution and the matter was disposed of by B.C Mitra J., by a judgment delivered on 15 July, 1969. His lordship in the concluding portion of his judgment observed:

“In the order of reference in Matter No. 718 of 1968, it is stated that the workmen are entitled in terms of the settlement to receive from the petitioner benefits which are capable of being computed in terms of money. The order of reference has, therefore fixed the liability on the petitioner and the only matter that has been left for the Tribunal is to compute in terms of money the amount due to the workmen. In Matter No. 717 of 1968, the order of reference again fixes the liability on the petitioner as the employer and as the successor of the transferor for retrenchment benefits under S. 25-FF of the Act. This, in my view, the State Government was not entitled to do, as the liability is that of the transferor and not of the transferee.

For the reasons mentioned above, these two rules are made absolute.

Respondent. 3 will be at liberty to make fresh order or orders of reference in the light of the observations made in this judgment and in compliance with the direction in the judgment of the appellate Court and in accordance with law.”

It is true that B.C Mitra, J., in the aforesaid judgment has observed:

“The appellate Court by its judgment to which I have referred earlier, directed that the question of closure should be left open for adjudication. The adjudication, it appears to me, has not taken place yet, and without such adjudication no order of reference under S. 33-C(2) of the Act can be made for computation of the benefits claimed by the workmen.”

10. But the ratio decidendi of his lordship's decision appears to be that the two references were bad because the Government had already fixed the liability of the Central Inland Water Transport Company Ltd., both in respect of the settlement and in respect of the claim under S. 25-FF. It seems to us that Ghose, J., is right in observing that B.C Mitra, J., struck down the orders of reference in view of the fact that these orders prejudged the issue, as to the liability of Central Inland Water Transport Company, Ltd., to pay compensation. Any other observation made by B.C Mitra, J., therefore, must be treated as obiter dictum.

11. After the judgment of B.C Mitra, J., the State Government made a fresh order of reference on 27 October, 1969. In this order of reference there is no prejudging of liability. Four issues were referred to the Labour Court. These issues were:

“(1) Whether the undertaking or the business of Rivers Steam Navigation Company, Ltd., has been transferred to Central Inland Water Transport Corporation, Ltd. If so, whether the settlement, dated 25 August, 1965, is binding on Central Inland Water Transport Corporation, Ltd.?

(2) Whether the workmen mentioned in List I bound by the settlement, dated 25 August, 1965 are entitled to continue in employment under Central Inland Water Transport Corporation, Ltd.? If so, what amount of money are they entitiled to? Is that money recoverable from Central Inland Water Transport Corporation, Ltd.?

(3) Whether the workman mentioned in List II are entitled to get retrenchment compensation under S. 25-F read S. 25-FF of the Industrial Disputes Act, 1947? If so, what amount of money are they entitled to?

(4) Whether the undertaking or the business of Rivers Steam Navigation Company, Ltd., has been closed within the meaning and contemplation of S. 25-FFF of the Industrial Disputes Act, 1947? If so, what amount of money as compensation are the workmen mentioned in Lists I and II entitled to?

12. This order reference of 27 October, 1969 was also challenged and came up for disposal before Ghose, J. The learned Judge has struck down issue (4), but has upheld the order of reference as far as issues (1) to (3), are concerned. The present appeal is against the judgment of Ghose, J. As there is no cross-objection with regard to issue (4), we are not concerned with that issue in this appeal. We have to decide whether, on the facts and in the circumstances of this case, the first three issues can be referred to a Labour Court. Before we proceed any further let us quote some of the relevant provisions of the Industrial Disputes Act:

“Section 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.

Section 7(1).— The appropriate Government may, by notification in the official gazette, constitute one or more Labour Courts for adjudication of industrial disputes relating to any matter specified in Sch. II and for performing such other functions as may be assigned to them under this Act.

In Sch. II, item 3, is

‘discharge or dismissal of workmen including reinstatement of or grant of relief to, workmen wrongfully dismissed.

Section 10(1).— Where the appropriate Government is of opinion that any industrial dispute exists or is apprehended, it may at any time, by order in writing:

(c) refer the dispute or any matter appearing to be connected with or relevant to the dispute, if it relates to any matter specified in Sch. II to a Labour Court for adjudication; or

(d) refer the dispute or any matter appearing to be connected with, or relevant to, the dispute, whether it relates to any matter specified in Sch. I or II to a Tribunal for adjudication.

[Item 10 in Sch. III is

‘retrenchment of workmen and closure of establishment.’]

Section 25-FF— Compensation to workmen in case of transfer of undertaking.— Where the ownership or management of an undertaking is transferred, whether by agreement or by operation of law from the employer in relation to that undertaking to a new employer, every workman who has been in continuous service for not less than one year in that undertaking immediately before such transfer shall be entitled to notice and compensation in accordance with the provisions of S. 25-F, as if the workman had been retrenched. [This section is in Chap. V-A of the Act.]

Section 33-C.— Recovery of money due from an employer.— (1) Where any money is due to a workman from an employer under a settlement or an award or under the provisions of Chap. V-A, the workman himself or any other person authorized by him in writing in this behalf, or, in the case of the death of the workman his assignee or heirs may, without prejudice to any other mode of recovery, make an application to the appropriate Government for the recovery of the money due to him, and if the appropriate Government is satisfied that any money is so due, it shall issue a certificate for that amount to the Collector who shall proceed to recover the, same in the manner as an arrear of land revenue:

(2) 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 benefit should be computed, then the question may, subject to any rules that may be made under this Act, be decided by such Labour Court as may be specified in this behalf by the appropriate Government.”

[Incidentally, we ought to mention at this stage that the Supreme Court in Central Bank of India, Ltd. v. P.S Rajagopalan [A.I.R 1964 S.C 743] at p. 749 in Para. 19 has observed that claims made under S. 33-C(1) by itself can only be claims referable to the settlement, award, or the relevant provisions of Chap. V-A. These words of limitation, according to the Supreme Court, are not to be found in S. 33-C(2) and to that extent the scope of S. 33-C(2) is undoubtedly wider than that of S. 33-C(1). In other, words, the Supreme Court observes further that, there is no doubt that the three categories of claims mentioned in S. 33-C(1) fail under S. 33-C(2) and in that sense S. 33-C(2) can itself be deemed to be a kind of execution proceeding. The position, therefore, is that claims arising under a settlement or an award or under Chap. V-A unquestionably come within the jurisdiction of a Labour Court. And it has been urged before us on behalf of the State Government as well as the workers that the claims herein are

(a) under a settlement, and

(b) under Chap. V-A.

13. Now, it is well settled that in construing S. 33-C(2) the Court has to determine on the facts of each case what the main or fundamental or substantial issue is. If the main issue is computation of money or benefit capable of being computed in terms of money and incidentally the Labour Court has to make an enquiry as to the existence of the right to receive the money or the right to the benefit claimed, the Labour Court has jurisdiction to go into the matter. If, on the other hand, the main or principal issue is not computation but matters like retrenchment or closure or any other item in Sch. III and unless the main issue is decided computation cannot be made then the Labour Court's jurisdiction would be ousted—vide Central Bank of India, Ltd. v. P.S Rajagopalan [A.I.R 1964 S.C 743]; Chief Engineer, East India Coal Company, Ltd., Bararee Colliery, Dhanbad v. Rameshwar [A.I.R 1968 S.C 218]; Uttar Pradesh Electric Supply Company, Ltd. v. R.K Shukla [(1969) 2 SCC 400 : A.I.R 1970 S.C 237]; Voltas, Ltd. v. J.M Demello [(1971) 2 SCC 479 : A.I.R 1971 S.C 1902]; and National Buildings Construction Corporation, Ltd. v. Pritam Singh Gill [1972 L.L.N 99].

14. In stating that the Labour Court has jurisdiction to go into the incidental matters the Supreme Court has adopted the principle that when an Act confers the jurisdiction, it impliedly also grants the power of doing all such act, or employing such means, as are essentially necessary to its execution. In other words, whenever any such thing is authorized, and specially if as a matter of duty required to be done by law and it is found impossible to do that thing unless something else not authorized in express terms can also be done then that something else will be supplied by necessary intendment—vide Maxwell on Interpretation of Statutes, Eleventh Edition, p. 350, and Brooks Legal Maxims, Tenth Edition, p. 313.

15. The Supreme Court has also expressed the view that a mere denial or pretence of a defence is not enough to oust the jurisdiction of the Labour Court—vide R.B Bansilal Abirchand Mills Company (Private), Ltd. v. Labour Court, Nagpur [A.I.R 1972 S.C 452] and Sher Singh Varma v. Rup Chandra [1967—II L.L.J 681 at 685].

16. The legal position, therefore is, that the Labour Court is principally concerned with computation of money payable to a workman or of benefit capable of being computed in terms of money; but in making the computation, the Labour Court can enter into and determine all questions which arise incidentally or which could be said to be essential or indispensable for the purpose of computation.

17. Bearing this principle in mind, we have to decide whether the Labour Court, in the instant case, has jurisdiction to entertain issues (1) to (3) referred to above. The main argument on behalf of the appellant is that on the facts it is first to be decided whether there has been a closure of the Rivers Steam Navigation Company, Ltd. This, according to counsel for the appellant, is the fundamental or substantial issue. If there has been a closure, there can be no question of any payment either under any settlement or on account of retrenchment. And since closure is the fundamental issue it can be decided only by an Industrial Tribunal under S. 10(1)(d) and not by a Labour Court under S. 33-C(2). Learned counsel for the appellant also relied strongly on the observations of B.C Mitra, J., that the adjudication on the question of closure has not yet taken place and without such adjudication no order of reference under S. 33-C(2) can be made for computation of benefits claimed by the workmen.

18. On the facts of this case we are unable to uphold the contentions submitted on behalf of the appellant. It appears that some of the workmen, in the instant case, are claiming compensation under the settlement, dated 25 August, 1965, and their case is that this settlement which was entered into between Rivers Steam Navigation Company, Ltd., and their workmen is binding on the Central Inland Water Transport Corporation, Ltd., by reason of provisions of S. 18(3)(c) of the Industrial Disputes Act, read with S. 19(2) thereof. We have already referred to the relevant provisions of S. 19(2). The relevant provisions of S. 18(3)(c) is that where a settlement is arrived at in course of conciliation proceedings under the Act it shall be binding not only on the employer but also on the employer's successors. According to the respondents the Central Inland Water Transport Corporation, Ltd., is a successor to the Rivers Steam Navigation Company, Ltd.

19. The other claim here is under S. 25-FF of Chap. V-A. Under this section the remaining workmen are claiming compensation as if they have been retrenched and the Supreme Court in Bihar State Transport Corporation v. State of Bihar [(1970) 1 SCC 490 : A.I.R 1970 S.C 1217) has held that a successor-in-title, in the circumstances stated in the judgment, is liable to pay wages and emoluments which accrued prior to the successor's taking over.

20. On the facts, therefore, it seems to us that the Labour Court is primarily concerned with computation of compensation and in doing so the Labour Court incidentally has to decide

(a) Whether Central Inland Water Transport Company, Ltd., is the successor in respect of the settlement, dated 25 August, 1965, and

(b) whether it is also the successor in respect of claims under S. 25-FF.

It may be that the question of closure will arise before the Labour Court in determining the said incidental questions but even then closure cannot, on the facts of this case, be the main or the principal question. In other words, before the Labour Court proceeds to compute compensation, it is essential for the Labour Court to determine whether the Central Inland Water Transport Company, Ltd., is a successor to the Rivers Steam Navigation Company, Ltd., and is liable to meet both the categories of claims we are concerned with in the present appeal. The question of succession does not appear to us, on the facts here, to be anything but an incidental question. We, therefore, hold that the Labour Court has jurisdiction to try issues (1) to (3) mentioned above.

21. In the result, this appeal is dismissed. There will be no order as to costs.

22. There will be a stay of operation of this order for six weeks from date.

23. Sabyasachi Mukherji, J.:— I agree.