Important point
Where in a settlement entered into between Bank and its employees Association, action of Bank in asking for a receipt from those employees who were not members of Association but wanted to avail benefit of settlement would not give rise to any industrial dispute.

Headnote:Industrial Disputes Act, 1947—Sections 18 and 10—Appellant bank entered into settlement dated 18.8.1996 with the Association, third respondent and members of Bank Employees Union—At the instance of Bank Employees Federation, respondent No. 2 the Central Government made a reference u/s 10 of the Act for adjudication by Industrial Tribunal—Reference was whether terms of bipartite settlement between Bank and Employees Association which bound withholding of benefits of settlement to workmen who were not member of Employees Association until individual gave acceptance of settlement in given format was legal and justified—Writ petition challenging the reference—Single Judge dismissed the writ and appeal failed before Division Bench—Appeal—Whether Central Government was justified in making a reference to Industrial Tribunal?—Reference did not refer to any dispute or apprehended dispute between Bank and Federation—Reference was wholly redundant and uncalled for—Settlement was binding only between Bank and the Association and Federation being not party to settlement, same was not binding upon it—Reference deserved to be set aside.
       Held : A plain reading of the provisions of Section 18 would show that where a settlement is arrived at by agreement between the employer and the workman otherwise than in the course of conciliation proceeding shall be binding on the parties to the agreement in view of the clear language used in sub-section (1) thereof. Sub-sections (2) and (3) of Section 18 contemplate different situations where an arbitration award has been given or a settlement has been arrived at in the course of conciliation proceedings. In M/s. Tata Chemicals Ltd. vs. The Workmen employed under M/s. Tata Chemicals Ltd. AIR 1978 SC 828, it was held as under:—
       “Whereas a settlement arrived at by agreement between the employer and the workman otherwise than in the course of conciliation proceeding is binding only on the parties to the agreement, a settlement arrived at in the course of conciliation proceeding under the Act is binding not only on the parties to the industrial dispute but also on other persons specified in Cls. (b), (c) and (d) of sub-sec. (3) of S. 18 of the Act.”
       The Federation (second respondent) not being party to the settlement, it is obvious that the same is not binding upon it in view of sub-section (1) of Section 18 of the Act. Thus the settlement dated 18.8.1996 did not affect the rights of the Federation (second respondent) in any manner whatsoever and it can possibly have no grievance against the said settlement. (Paras 7 and 8)
       As already stated, the settlement was arrived at between the Bank and the Association (third respondent) and by virtue of sub-section (1) of Section 18 of the Act it bound only the members of the Association (third respondent). However, the Bank also extended the benefit of settlement to such other employees, who were not members of the Association. In order to avail of the benefit they had to give a receipt that they were accepting the settlement and the same shall be binding upon them and the format of the receipt, which has been reproduced earlier, does not contain any such term, which may be of detriment to them. To protect its interest the Bank was perfectly justified in asking for a receipt from those employees, who were not members of the Association (third respondent), but wanted to avail of the benefit of the settlement. Therefore, we do not find anything wrong in the Bank asking for a receipt from the aforesaid category of employees. (Para 9)
       A plain reading of the reference made by the Central Government would show that it does not refer to any dispute or apprehended dispute between the Bank and the Federation (second respondent). It does not refer to any demand or claim made by the Federation or alleged refusal thereof by the Bank. In such circumstances, it is not possible to hold that on account of the settlement dated 18.8.1996 arrived at between the Bank and the Association (third respondent), any dispute or apprehended dispute has come into existence between the Bank and the Federation (second respondent). The action of the Bank in asking for a receipt from those employees, who are not members of the Association (third respondent) but wanted to avail of the benefit of the settlement, again does not give rise to any kind of dispute between the Bank and the Federation (second respondent). Thus, the reference made by the Central Government by the order dated 29.12.1997 for adjudication by the Industrial Tribunal is wholly redundant and uncalled for. (Para 11)
       It is true that normally a writ petition under Article 226 of the Constitution should not be entertained against an order of the appropriate Government making a reference under Section 10 of the Act, as the parties would get opportunity to lead evidence before the Labour Court or Industrial Tribunal and to show that the claim made is either unfounded or there was no occasion for making a reference. However, this is not a case where the infirmity in the reference can be shown only after evidence has been adduced. In the present case the futility of the reference made by the Central Government can be demonstrated from a bare reading of the terms of the reference and the admitted facts. In such circumstances, the validity of the reference made by the Central Government can be examined in proceedings under Article 226 of the Constitution as no evidence is required to be considered for examining the issue raised. (Para 13)

Judgment

G.P. Mathur, J.—This appeal, by special leave, has been preferred against the judgment and order dated 19.6.2000 of the Bombay High Court by which the Letters Patent Appeal filed by ANZ Grindlays Bank Limited (hereinafter referred to as the ‘Bank’) was dismissed and the order dated 29.2.2000, passed by the learned single Judge dismissing the writ petition filed by the Bank, was affirmed. The present appeal has been filed by ANZ Grindlays Bank Limited and the respondents arrayed in the appeal are (1) Union of India, (2) All India Grindlays Bank Employees Federation, and (3) All India Grindlays Bank Employees Association. During the pendency of the appeal in this Court the entire share capital of ANZ Grindlays Bank Limited has been acquired by Standard Chartered Bank Limited and consequently an application (I.A.No. 3 of 2000) has been moved to change the name of the appellant from ANZ Grindlays Bank Limited to Standard Chartered Grindlays Bank Limited, which has been allowed.

2. The Bank has branches all over the country and employs approximately 1666 personnel commonly known as Award Staff in its branches/offices in India. The All India Grindlays Bank Employees Association (third respondent) is recognized by the Bank and it represents majority workmen of the Bank all over the country. The All India Grindlays Bank Employees Federation (second respondent) represents the minority workmen of the Bank. The terms and conditions of the employment of the workmen of the appellant Bank, popularly known as Award Staff, are governed by Shastri Award as modified by Desai Award and the bipartite settlements entered into between the Indian Banks Association and the Unions and Federations representing the workmen in the banking industry. Apart from these industry wise bipartite settlements, the appellant-Bank also entered into in-house bilateral settlement with second and third respondents and these settlements are usually signed after every three years in respect of certain allowances and benefits and other terms and conditions of employment. The third respondent the All India Grindlays Bank Employees Association (for short the “Association”) represents over 66% of the workmen of the appellant-Bank. The Grindlays Bank Employees Union, Calcutta, an affiliate of the second respondent All India Grindlays Bank Employees Federation (for short the `Federation’) represents nearly 13% of the workmen of the Bank and the balance, who are not members of either of these unions are represented by the second respondent the All India Grindlays Bank Employees Federation.

3. The case of the appellant is that the Federation (second respondent) is in the habit of backing out from signing the settlement at the last minute after having agreed to the terms thereof. Since 1993 several settlements were entered into between the Bank, the Association (third respondent) and also Grindlays Bank Employees Union, Calcutta. However, on account of the recalcitrant attitude of the Federation (second respondent), in the settlement entered into under Section 18(1) of the Industrial Disputes Act, 1947 (for short the ‘Act’) a clause had to be incorporated for voluntary acceptance of the terms and conditions of such settlements by non-members of the Association (third respondent) with a view to extend the benefit of such settlements to such of the non-members of the Association, who are willing to accept the settlement.

4. A strike notice dated 14.3.1996 was issued to the management of the Bank by the Federation (second respondent). Discussions were held with all the parties and finally a settlement was arrived at between the appellant-Bank and the Association (third respondent), which was signed on 18.8.1996. The Federation (second respondent), however, backed out and refused to sign the settlement. The Federation then informed the Conciliation Officer (Central) on 19.8.1996 that it had not signed the settlement and that the signing of the settlement by the Bank with the As

Click Here to Read the rest of this document

Judicial Analysis

SupremeToday

2005 Supreme(SC) 1456

Important pointWhere in a settlement entered into between Bank and its employees Association, action of Bank in asking for a receipt from those employees who were not members of Association but wanted to avail benefit of settlement would not give rise to any industrial dispute.

Cases Referred (3)

Judicial Analysis

Important point
Where in a settlement entered into between Bank and its employees Association, action of Bank in asking for a receipt from those employees who were not members of Association but wanted to avail benefit of settlement would not give rise to any industrial dispute.