1. Industrial dispute regarding bonus payment — Application to join a third party to the reference — Challenge to Tribunal's refusal to add party under Section 18(3)(b), Industrial Disputes Act. (Para 1 , 2 , 3 )
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1964 Supreme(SC) 115
SUPREME COURT OF INDIA
1st April, 1964
P.B. GAJENDRAGADKAR, C.J.I., K.N. WANCHOO AND K.C. DAS GUPTA, JJ.
Hochtief Gammon, Appellant
Versus
Industrial Tribunal, Bhubaneshwar, Orissa and others, Respondents.
Civil Appeal No. 611 of 1963.
Advocates Appeared
Mr. N. C,. Chatterjee, Senior Advocate, (Mr. G. Narayanaswamy, Advocate, M/s. J. B. Dadachanji, Ravinder Narain and O. C. Mathur, Advocates, of M/s. J. B. Dadachanji and Co. with him), for Appellant; Mr. Janardhan Sharma, Advocate, for Respondent No. 2; Mr. S. V. Gupte, Additional Solicitor General of India, (M/s. G. B. Pai, and R. H. Dhebar, Advocates with him), for Respondent No. 3.
Important Points
The Industrial Tribunal has an implied power under Section 18(3)(b) of the Industrial Disputes Act, 1947, to add parties necessary to make an award effective and enforceable, provided such addition does not enlarge the scope of the reference or introduce non-incidental disputes.
Subject
Labour Law - Industrial Disputes
Act Referred
Headnote
(A) Industrial Disputes Act, 1947 - Section 18(3)(b) - Implied power of Industrial Tribunal to add parties - Power exists to summon parties other than those directly involved in the dispute to ensure the award is effective and enforceable - Such power is limited and cannot be used to enlarge the scope of the reference or introduce matters not incidental to the dispute. (Paras 4-6, 11-12)
(B) Jurisdiction of Industrial Tribunal - Limited jurisdiction derived from the order of reference - Cannot travel materially beyond the terms of reference - Test for adding parties: whether non-joinder would make the proceedings ineffective and unenforceable. (Paras 7, 12)
Facts of the case:
An industrial dispute regarding bonus payments was referred to an Industrial Tribunal. The appellant sought to join a third party to the proceedings, contending that the third party was the actual employer or held the liability for the bonus. The tribunal deferred the decision, and the High Court dismissed a writ petition as premature.
Findings of Court:
The court held that while the tribunal possesses an implied power to add parties under Section 18(3)(b), this power is restricted to parties whose presence is essential for making the award effective. The third party in this instance was not a necessary party because the disputes regarding actual employment or liability were separate and not incidental to the referred dispute.
Issues: Whether Section 18(3)(b) of the Industrial Disputes Act, 1947, confers an implied power upon the Industrial Tribunal to add parties to the proceedings and the scope of such power.
Ratio Decidendi: The Industrial Tribunal has an implied power under Section 18(3)(b) to summon parties other than the original parties to the dispute, provided their addition is necessary to make the adjudication effective and enforceable. This power cannot be exercised to extend the scope of the reference or address disputes that are not incidental to the referred matter.
Result: Appeal dismissed.
(B) Jurisdiction of Industrial Tribunal - Limited jurisdiction derived from the order of reference - Cannot travel materially beyond the terms of reference - Test for adding parties: whether non-joinder would make the proceedings ineffective and unenforceable. (Paras 7, 12)
Facts of the case:
An industrial dispute regarding bonus payments was referred to an Industrial Tribunal. The appellant sought to join a third party to the proceedings, contending that the third party was the actual employer or held the liability for the bonus. The tribunal deferred the decision, and the High Court dismissed a writ petition as premature.
Findings of Court:
The court held that while the tribunal possesses an implied power to add parties under Section 18(3)(b), this power is restricted to parties whose presence is essential for making the award effective. The third party in this instance was not a necessary party because the disputes regarding actual employment or liability were separate and not incidental to the referred dispute.
Issues: Whether Section 18(3)(b) of the Industrial Disputes Act, 1947, confers an implied power upon the Industrial Tribunal to add parties to the proceedings and the scope of such power.
Ratio Decidendi: The Industrial Tribunal has an implied power under Section 18(3)(b) to summon parties other than the original parties to the dispute, provided their addition is necessary to make the adjudication effective and enforceable. This power cannot be exercised to extend the scope of the reference or address disputes that are not incidental to the referred matter.
Result: Appeal dismissed.
Legal Category Hierarchy
Advocates:
G.B.PAI, G.NARAYANASVAMY, J.B.DADACHAN, JANARDAN SHARMA, N.C.CHATTERJI, R.H.Dhebar, Ravindra Narayan, S.V.Gupta
G.B.PAI, G.NARAYANASVAMY, J.B.DADACHAN, JANARDAN SHARMA, N.C.CHATTERJI, R.H.Dhebar, Ravindra Narayan, S.V.Gupta
Table of Contents
2. Whether the Industrial Tribunal possesses implied power to add necessary parties to proceedings and whether a third party is necessary for effective adjudication of the dispute. (Para 3 , 16 , 17 )
3. The Tribunal has an implied power to summon parties under Section 18(3)(b) to ensure effective adjudication, provided it does not materially enlarge the reference's scope. (Para 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14 , 15 )
4. Power to add parties under Section 18(3)(b) is limited to those whose joinder is necessary to make the adjudication effective and the award enforceable. (Para 12 )
5. Appeal dismissed — Third party not considered a necessary party as their joinder would enlarge the scope of the reference beyond incidental matters. (Para 18 )
6. Does the Industrial Tribunal have the power to add parties not named in the original reference?
Yes, Section 18(3)(b) of the Industrial Disputes Act postulates an implied power for the Tribunal to summon parties other than those directly involved in the industrial dispute to appear in the proceedings. (Para 4 , 5 , 6 , 10 , 11 )
7. What is the limitation on the Tribunal's power to add parties under Section 18(3)(b)?
The power is limited by the Tribunal's jurisdiction, which is defined by the order of reference. It cannot be used to materially enlarge the scope of the reference or introduce non-incidental matters. (Para 7 , 12 , 15 )
8. What is the legal test to determine if a party is a necessary party under Section 18(3)(b)?
The test is whether the addition of the party is necessary to make the adjudication effective and enforceable, or whether their non-joinder would render the proceedings ineffective and unenforceable. (Para 12 )
Judgment
GAJENDRAGADKAR, C.J.I. : The short question which this appeal by special leave raises for our decision is in relation to the construction of S. 18(3) (b) of the Industrial Disputes Act, 1947 (No. 14 of 1947) (hereinafter called the Act ). This question arises in this way. An industrial dispute in regard to the payment of bonus arose between the appellant Hochtief Gammon and the respondents, its workmen, represented by the Rourkela Workers Union, Rourkela. This dispute was referred for adjudication to the Industrial Tribunal, Orissa by the Government of Orissa on the 14th November, 1960. After the reference was received by the Tribunal, it passed an order on the 17th November, 1960 that notice of the reference should be issued to the parties concerned. Purporting to give effect to this order, the office of the Tribunal issued notices not only to the appellant and the respondents, but also to the Deputy General Manager of M/s. Hindustan Steel Ltd. This was so done apparently because a copy of the notification of the Government of Orissa containing the order of reference had been served on the said Dy. General Manager. After the notice issued by the Tribunal was received by the Dy. General Manager of the Hindustan Steel Ltd., he appeared before the Tribunal and urged that the Hindustan Steel Ltd. was not concerned or interested in the dispute and should not be added as a party to the reference.
2. Meanwhile, the appellant made an application to the Tribunal on the 21st March, 1961 and contended that the interests of M/s. Hindustan Steel Ltd. and the appellant were common in the proceeding pending before the Tribunal, and so, M/s. Hindustan Steel Ltd. should be joined as a party. In this application, the appellant alleged that M/s. Hindustan Steel Ltd. was a necessary party, because the material documents which may have to be proved in the proceedings were with the said concern and, in fact, the enquiry in question would not be complete without the said concern being joined as a party. The Tribunal then considered the question of joining M/s. Hindustan Steel Ltd. as a party and held that it would decide the matter later. Meanwhile, the tribunal directed that M/s. Hindustan Steel Ltd. which had appeared in response to the notice issued to it should remain present during the hearing of the reference on the merits.
3. This order did not satisfy the appellant, because it wanted a specific direction from the Tribunal to add M/s. Hindustan Steel Ltd. as a party to the reference. That is why the appellant moved the Orissa High Court under Art. 226 of the Constitution and prayed that the order passed by the Tribunal refusing to deal with the matter should be set aside and M/s. Hindustan Steel Ltd. should be joined as a party to the reference before it. This writ petition, however, failed, because the High Court took the view that it was premature. The High Court observed that the Industrial Tribunal had not yet passed a final order under S. 18(3) (b) of the Act, and so, without expressing any opinion on the merits of the controversy between the parties, the High Court treated the application as incompetent because it was premature. Against this decision, the appellant has come to this Court by special leave; and on his behalf, Mr. Chatterji has contended that the Industrial Tribunal has jurisdiction to add a party to the proceedings before it and that on the merits, M/s. Hindustan Steel Ltd. should be added as a necessary party. That is how the main question which arises for our decision is to determine the scope and effect of the provisions of S. 18(3) (b) of the Act.
4. In dealing with this question, it is necessary to consider the provisions of S. 18(b) in the Act as it was first enacted, and then consider the provisions of S. 18(3) (b) as they now stand. Under the original Act, Section 18 consisted of four clauses (a), (b), (c), and(d). We are concerned in the present appeal with clauses (a) and (b). Section 18(a) and (b) read th
