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1978 Supreme(SC) 40

SUPREME COURT OF INDIA
P.N. BHAGWATI, P.N. SHINGHAL AND JASWANT SINGH, JJ.
New Standard Engineering Co. Ltd., Appellant
Versus
N. L. Abhyankar and another, Respondents.
Civil Appeal No. 1177 of 1973
Decided on  2-2-1978
Advocates appeared
Mr. F. N. Kaka, Sr. Advocate, (M/s. D. C. Shroff, I. N. Shroff and H. S. Parihar, Advocates with him), for Appellant; Mr. Y. S. Chitaley, Sr. Advocate (M/s. P. H. Parekh, K. Vasudev, C. B. Singh and Mrs. Manju Sharma, Advocates with him) (for Nos. 2, 4, & 5) and Mr. S. J. Deshmukh & M/s. K. L. Hathi & P. C. Kapur, Advocates for No. 3, Respondents.

Advocates:
C.B.SINGH, D.C.SHROFF, F.N.KAKA, H.S.PARIHAR, I.M.SHROFF, K.L.Hathi, K.VASUDEVA PILLAI, MANJU SHARMA, P.C.KAPUR, P.H.Parekh, S.J.DESHMUKH, Y.S.Chitale

Headnote:

Constitution of India - Articles 226 and 227 – Claim of compensation – Demand of dowry - High Court took notice of the fact that respondent No. 3 which claimed to represent "a substantial number of workmen" supported the settlement, but it held that the alleged settlement was "not a settlement under Section 2 (p)" of the Act and it was not open to it to "take notice of the said settlement in proceedings under Articles 226 and 227 of the Constitution." It therefore thought it proper to dispose of the petition on the merits, rather than leave it to uncertainty and inter-union rivalry, which might lead to industrial unrest. In that view of the matter, the High Court dismissed the petition on merits by its judgment dated 31-7-73/1-8-73. In the meantime, the memorandum of settlement was signed by and on behalf of the Company and respondent – Held, It is well known that the possibility of an adverse decision by the Court operates as a positive force in favour of deliberate and careful effort by both parties to settle their dispute through direct negotiations. And we have no doubt that it is that force which has brought about the settlement under consideration. Then there is the further fact that, as has been stated by the Tribunal, the workmen were liable, in the event of the success of the Company, to a refund of the amounts which had already been paid to them on that understanding - Moreover, as has been found by the Tribunal, out of 1328 workmen who were in the Companys service on July 31, 1973, 995 workmen have signed the settlement and have also accepted their dues thereunder, and 242 workmen have accepted their dues under the settlement by actually signing the receipts though they have not signed the settlement. It will also be recalled that 910 workmen who left the Company between Jan. 1, 1968 and July 31, 1973 have also accepted 986 their dues under the settlement. As has been stated, the settlement was made with the Bhartiya Kamgar Sena (respondent No. 3) which represented a very large majority of the workmen of the Company. It is a significant fact that the bona fides of that Union have not been challenged before us. There is therefore no reason why the Tribunals finding that the settlement is just and fair should not be accepted - It has to be remembered that the settlement was entered into on the morning of July 31, 1973, while the High Court delivered its judgment on August 1, 1973. It is therefore difficult to ignore the argument of Mr. Deshmukh that it was only when the workmen came to know that the award had been confirmed by the High Court, that they thought they had nothing to lose by challenging the settlement as unfair and unjust. It is that feeling which appears to have been exploited by respondent No. 2, because of inter-union rivalry. As it is, we are satisfied that the Tribunals finding on issue No. (e) is also correct and does not call for interference - Appeal allowed

JUDGMENT

SHINGHAL, J. :— The Government of Maharashtra referred to the Industrial Tribunal, Bombay, the dispute between the New Standard Engineering Company Ltd., Bombay (referred to as the Company) and its workmen, for adjudication under Section 10 (1) (d) of the Industrial Disputes Act, 1947, hereinafter referred to as the Act. The order of reference was made on August 9, 1966, and it stated all the demands of the workmen. The Tribunal gave its award on November 29, 1972. It held, inter alia, that the revised wage scales and the scheme of dearness allowance shall come into force and the workmen shall be entitled to wages at the revised rates from January 1, 1968.

2. The Company challenged the award in the High Court by a petition under Articles 226 and 227 of the Constitution which was fixed for hearing on July 30, 1973. An application was made for an adjournment, but to no avail. The dictation of the judgment commenced on July 31, 1973 and was concluded on August 1, 1973. One of the points which was urged in the High Court was that the Company had arrived at a settlement with the Union known as the Bhartiya Kamgar Sena (respondent No. 3) and an award may be made in terms of that settlement, or a direction may be given to the Tribunal to consider whether the settlement was fair and reasonable. It was brought to the notice of the High Court that some workers had already accepted the settlement and some more may accept it. The request for adjournment on that account, as well as the settlement, were opposed on behalf of the General Engineering Employees Union (respondent No. 2) and some others. The High Court took notice of the fact that respondent No. 3 which claimed to represent "a substantial number of workmen" supported the settlement, but it held that the alleged settlement was "not a settlement under Section 2 (p)" of the Act and it was not open to it to "take notice of the said settlement in proceedings under Articles 226 and 227 of the Constitution." It therefore thought it proper to dispose of the petition on the merits, rather than leave it to uncertainty and inter-union rivalry, which might lead to industrial unrest. In that view of the matter, the High Court dismissed the petition on merits by its judgment dated 31-7-73/1-8-73. In the meantime, the memorandum of settlement was signed by and on behalf of the Company and respondent No. 3 (Bhartiya Kamgar Sena).

3. The Company felt aggrieved against the judgment of the High Court and applied for special leave to appeal to this Court. Leave was granted on August 10, 1973 along with an order for stay of enforcement of the award on condition that the appellant paid the workers in accordance with the terms of the settlement of which copies were to be filed by counsel. Thereafter the "consent terms", duly signed, were filed by counsel for the parties and an order was made on September 28, 1973, after notice to all concerned, that the matter would go back to the Industrial Tribunal "for findings and transmission thereof to this Court" along with a copy of the following consent terms,-

"The appellants and respondents 2 to 5 agree that the matter be sent down to Industrial Tribunal, Maharashtra, Bombay, for recording findings on the following issues :

(a) Whether the settlement dated 31st July 1973 between the appellant company and respondent No. 3 is a settlement under Section 2 (p) of the Industrial Disputes Act, 1947.

(b) Whether the settlement was entered into voluntarily.

(c) How many workmen covered by the reference have signed and/or accepted the settlement.

(d) Whether the individual workmen who have signed and/or accepted the settlement have done so voluntarily. 984

(e) Whether the settlement is just and fair."

The Tribunal found issues Nos. (a), (b), (d) and (e) in the affirmative. As regards issue No. (c) it found that out of 1328 workmen who were in service on July 31, 1973, 995 workmen has signed the settlement and had also accepted their dues thereunder, and 242 workmen













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