1952 Supreme(SC) 87

SUPREME COURT OF INDIA
5th December 1952
PATANJALI SASTRI, C.J.I., B.K. MUKHERJEA, CHANDRASEKHARA AIYAR, BOSE AND GHULAM HASAN, JJ.
The State of Madras
Versus
C.P. Sarathy and another Respondents.
Case No. 86 of 1951.
Advocates appeared
Shri V. K. T. Chari, Advocate-General of Madras (Shri Ganapathy Iyer, Advocate, with him), instructed by Shri G. H. Rajadhyaksha, Agent, for the State; Shri K. S. Krishnaswamy Iyengar, Senior Advocate (Shri K. Venkataramani, Advocate, with him), instructed by No. 1.

Headnote:Sections 10 (1) 18, 29-Actual existence of dispute not necessary for reference under the Act-Apprehension of dispute is sufficient-Dispute not particularised-Validity-Scope of jurisdiction under the Act-Duty of court in respect to award under the Act-Effect of expiry of award on prosecution for breach for terms of award.

       The first respondent S was the managing director of a cinema company in Madras. He was charged for an offence under S. 29, Industrial Disputes Act, 1947, on the ground that he failed to implement certain terms of an award dated 15-12-1947 made by the Industrial Tribunal, Madras, appointed under the Act. S raised a preliminary objection before the Magistrate that

       1. Western India Automobile Association v. Industrial Tribunal, Bombay, A.I.R. (1949) F.C. 111, 120, referred to.

       2. State of Madras v. C.P. Sarathy, A.I.R. 1953 S.C. 53: (1953) S.C.R. 334 referred to.

       3. Bharat Bank Ltd. v. Employees of Bharat Bank Ltd., (1950) S.C.R. 459: A.I.R. (1950) S.C. 188 referred to.

       4. A.I.R. 1955 S.C. 170 relied upon.

       he had ho jurisdiction to proceed with the enquiry as the award on which the prosecution was based was void and ultra vires, the reference to the Industrial Tribunal not having been made by the Government in accordance with the requirements of S. 10 of the Act. On the magistrate refusing to deal with the objection as a preliminary point, S applied to the High Court for a writ of certiorari to quash the proceedings before the Magistrate. This was granted by the High Court and the proceedings before the Magistrate quashed.

       Before the High Court the respondent raised three contentions: First the Government had no jurisdiction to make the reference in question as there was no dispute between the management and workers of Prabhat Talkies and, therefore, the reference and the award in so far as they related to the first respondent were ultra vires and void; secondly, in any case the notification by the Government purporting• to refer to an industrial dispute to the Tribunal was not competent under the Act, inasmuch as it did not refer to any specific disputes as arising for adjudication and did not mention the companies or firms in which the disputes were said to have existed or were apprehended; and thirdly, the Madras Amendment Act was unconstitutional and void under S. 107, Government of India Act, 1935, being repugnant to the provisions of the Central Industrial Disputes Act, 1947, and also void under Art. 13(1) read with Art. 14 of the Constitution as being discriminatory in character. These conditions were upheld by the, High Court.

       Held: (1) In the present case the Government referred "an Industrial dispute between the workers and managements of cinema talkies in Madras city in respect of certain matters". As pointed out in the Labour Commissioners letter to the Government, there were 24 cinema companies, in Madras, and the Association, which, as a duly registered trade union, represented their employees, put forward the demands on behalf of the employees of all the cinema houses in the city. 15 out of 43 workers of the "Prabhat Talkies" were admittedly members of the association which thus figured as one of the parties to the dispute. In that situation, the Government may have thought, without a close examination of the conditions in each individual establishments that disputes which affected the workmen collectively existed in the cinema industry in the city and that, even if such disputes had not actually arisen in any particular establishment they could, having regard to their collective nature, will be apprehended as imminent in respect of that establishment also. It is not denied that notices were sent by the Tribunal to all the 24 companies and they all filed written statements of their case in answer to the demands made by the Association on behalf of the employees. In these circumstances, it is idle to claim that the Government had no jurisdiction to make the reference and that the award was not binding on the respondents organization. The latter was clearly bound by the award under S. 18 of the Act .

       (2) The Government must have sufficient knowledge of the nature of the dispute to be satisfied that it is an industrial dispute within the meaning of the Act, as, for instance, that it relates to retrenchment or reinstatement. But, beyond this no obligation can be held to lie on the Government to ascertain particulars of the disputes before making a reference under S. 10 (1) or to specify them in the order.

       The reference under S. 10(1)(c) is not, therefore, incompetent merely because it is made in general terms and the disputes are not particularised.

       (3) "This is however, not to say that the Government will be justified in making a reference under S. 10 (1) without satisfying itself on the facts and circumstances brought to its notice that an industrial dispute exists or is apprehended in relation to an establishment or a definite group of establishments engaged in a particular industry. It is also desirable that the government should, wherever possible indicate the nature of the dispute in the order of reference. But, it must be remembered that in making a reference under S. 10 (1) the Government is doing an administrative act and the fact that it has to form an opinion as to the factual existence of an industrial dispute as a preliminary step to the discharge of its function does not make it any the less administrative in character. The Court cannot, therefore, canvass the order of reference closely to see if there was any material before the Government to support its conclusion, as if it was a judicial or quasi-judicial determination. No doubt, it will be open to a party seeking to impugn the resulting award to show what was referred by the Government was not an industrial dispute within the meaning of the Act, and that, therefore, the Tribunal had no jurisdiction to make the award. But, if the dispute was an industrial dispute as defined in the Act, its factual existence and the expediency of making a reference in the circumstances of a particular case are matters entirely for the Government to decide upon, and it will not be competent for the Court to hold the reference bad and quash the proceedings for want of jurisdiction merely because there was, in its opinion, no material before the Government on which it could have come to an affirmative conclusion on those matters. The -observations in some of the decisions in Madras do not appear to have kept this distinction in view.

       (4) The adjudication by the Tribunal is only an alternative form of 8ettlement of the disputes on a fair and just basis having regard to the prevailing conditions in the industry and is by no means analogous to what an arbitrator has to do in determining ordinary civil dispute according to the legal rights of the parties. Indeed, this notion that a preference to a Tribunal under the Act must specify the particular disputes appears to have been derived from the analogy of an ordinary arbitration.

       (5) In view of the increasing complexity of modern life and the interdependence of the various sectors of a planned national economy, it is. obviously in the interest of the public that labour disputes should be peacefully and quickly settled within the frame-work of the Act rather than by resort to methods of direct action which are only too well calculated to disturb the public peace and order and diminish production in the country, and courts should not be astute to discover formal defects and technical flaws to overthrow such settlements.

       (6) S was prosecuted for an offence made punishable under S. 29 of the Act which is a permanent statute and when he committed the alleged breach of some of the terms of the a ward, which was in force at the time, he incurred the liability to be prosecuted under the Act. The fact that the award subsequently expired cannot affect the liability.