The jurisdiction of a Labour Court or Industrial Tribunal is limited to the points specifically referred for its adjudication and the matters incidental thereto. It cannot go beyond the terms of reference except for ancillary matters.

Headnote:
INDUSTRIAL DISPUTES ACT, 1947 - SECTION 9A, 25F, 25N - SCHEDULE III, ITEM 10, 11 - RETRENCHMENT - JURISDICTION - LABOUR COURT - INDUSTRIAL TRIBUNAL - SETTLEMENT - LEGALITY - INDUSTRIAL DISPUTES ACT, 1947 - SECTION 10(1)(C), 10(1)(D), 12(4), 12(5) - REFERENCE - APPROPRIATE GOVERNMENT - OPINION - INDUSTRIAL DISPUTES ACT, 1947 - SECTION 7 - JURISDICTION - INDUSTRIAL TRIBUNAL.
Fact of the Case:

The Management of M/s Jor Bagh Distributors Pvt. Ltd. (Management) retrenched 57 workmen due to re-organization of business. The workmen, represented by the Mercantile Bank Association (Union), filed a joint claim alleging that the retrenchment was illegal and unjustified. The Labour Court, after considering the evidence and submissions of both parties, held that the retrenchment was legal and justified as the Management had complied with the provisions of Section 25F of the Industrial Disputes Act, 1947 (Act). However, the Labour Court also held that the Management had failed to serve notice under Section 9A of the Act, which made the retrenchment illegal. The Management challenged the award of the Labour Court by filing a writ petition in the High Court.
Finding of the Court:

The High Court held that the Labour Court had no jurisdiction to adjudicate upon the question of whether the retrenchment fell under Item 10 or Item 11 of Schedule IV or Section 9A of the Act, as these matters were not included in the terms of reference. The High Court further held that the Labour Court had erred in holding that the retrenchment was illegal due to the Management's failure to serve notice under Section 9A, as this provision was not applicable to the facts and circumstances of the case. The High Court also held that the settlement arrived at between the Management and the workmen was valid and binding, and it did not make the illegal retrenchment into a legal one.
Issues: 1. Whether the Labour Court had jurisdiction to adjudicate upon the question of whether the retrenchment fell under Item 10 or Item 11 of Schedule IV or Section 9A of the Act? 2. Whether the Labour Court erred in holding that the retrenchment was illegal due to the Management's failure to serve notice under Section 9A? 3. Whether the settlement arrived at between the Management and the workmen was valid and binding?
Ratio Decidendi: 1. The jurisdiction of a Labour Court or Industrial Tribunal is limited to the points specifically referred for its adjudication and the matters incidental thereto. It cannot go beyond the terms of reference except for ancillary matters. 2. Section 9A of the Act was not applicable to the facts and circumstances of the case, as the retrenchment was not due to rationalization, standardization or improvement of plant or technique, or due to increase or reduction in the number of persons employed occasioned by circumstances over which the employer had no control. 3. A settlement arrived at between an employer and workmen, otherwise than in the course of conciliation proceedings, is binding upon the parties to the agreement.
Final Decision: The High Court quashed and set aside the award of the Labour Court and held that the retrenchment was legal and justified, and the workmen were not entitled to any relief.

Devinder Gupta

( 1 ) IN this writ petition filed under Article 226 of the Constitution of India award, annexure P-8, dated 28. 12. 1992 passed by respondent No. 2, the Presiding Officer, Labour Court VII, Tis Hazari, Delhi is under challenge at the behest of the management of M/s Jor Bagh Distributors Pvt. Ltd. (hereinafter referred to as the Management ).

( 2 ) ON receipt of a report submitted by the Concilliation Officer under Section 12 (4) of the Industrial Disputes Act, 1947 (hereinafter referred to as the Act ), the Secretary (Labour), Delhi Administration, on being satisfied that an industrial dispute existed between the Management and its workmen, represented by the Mercantile Bank Association (for short the Union ) and that the same deserved to be referred for adjudication to a labour court, constituted under the Act, in exercise of powers conferred by Section 10 (1) (c) and Section 12 (5) of the Act, referred for adjudication to the Labour Court the following dispute:

"whether the retrenchment of S/sh. Deepak Soni. . . (names of 57 workmen are stated) is legal and justified and, if not, to what relief arc they entitled and what directions are necessary in this respect?"on receipt, of reference the Labour Court issued notice to the parties. A joint statement of claim was preferred by the workmen through the aforementioned Union on21. 11. 1983. Written statement thereto was submitted by the Management on 27. 3. 1984. The workmen filed rejoinder to the written statement on 20. 4. 1984. The workmen in their joint claim alleged that M/s Parle Exports Private Ltd. (for short parle ) opened a factory at 60, Shivaji Marg, Moti Nagar, New Delhi for the manufacture and marketing of their special brand of aerated waters viz. Gold Spot, Rim Zim, Soda etc. some time in 1965. In 1966 Parle organised M/s Delhi Bottling Co. P. Ltd. and transferred the business, i. e. , manufacture and sale of their products in Northern India to the Delhi Bottling Co. P. Ltd. , which had four departments, namely, production, sales, publicity and garage. Delhi Bottling Co. Pvt. Ltd. appointed M/s Vijay Anand Associates Pvt. Ltd. as their agents for publicity, garage, carpentry and sales from 1. 4. 1973 to 1. 6. 1974 and transferred their employees in these departments to the said agency and continuity of service with protection of length of their service. . Agency was later taken over by Olrite Agency Pvt. Ltd. in 1974 and thereafter by Jor Bagh Distributors Pvt. Ltd. which later on was taken over by D. K. Agencies and again it reverted back to Jor Bagh Distributors Pvt. Ltd. (the Management ).

( 3 ) IT was alleged that the Management is an agency of Delhi Bottling Co. Pvt. Ltd. The licence for manufacturing and marketing of aerated products of Parle in the Union Territory and other parts of Northern India was with the Delhi Bottling Co. Pvt. Ltd. and not with the Management. The Industry, as such is the Delhi Bottling Co. Pvt. Ltd. and the Parle Exports Pvt. Ltd. It was alleged that the Management was employing 373 workmen in 1982 and was an establishment covered by the provisions of Chapter V B of the Act. President of the employees Union had served a demand notice dated 7. 12. 1982 on they Management, protesting against illegal lock out and requesting the Management to allow the workmen to resume duty. Matter was referred to the Concilliation Officer for his intervention, under Section 12 of the Act, with a request to issue prohibitory orders under Section 10 (3) with the reference of dispute over the bonus for the year 1982. Along with the claim statement, a letter of espousal and letter of authority signed by 95 workmen employed by the Management was filed with the Concilliation Officer.

( 4 ) IT was alleged that Management, while acknowledging the demand notice dated 7. 12. 1982 through their letter dated 13. 12. 1982 had stated that-there was no lock out in the establishment but the workmen were retrenched due to re-organisation of business a

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1996 Supreme(Del) 374

High Court Of DelhiMANAGEMENT OF M/S JOR BAGH DISTRIBUTORS PRIVATE LIMITED - AppellantVersusWORKMEN - RespondentDecided On : 05/01/1996

The jurisdiction of a Labour Court or Industrial Tribunal is limited to the points specifically referred for its adjudication and the matters incidental thereto. It cannot go beyond the terms of reference except for ancillary matters.

Cases Referred (5)

High Court Of Delhi
MANAGEMENT OF M/S JOR BAGH DISTRIBUTORS PRIVATE LIMITED - Appellant
Versus
WORKMEN - Respondent
Decided On : 05/01/1996