An agreement to refer an industrial dispute to arbitration during conciliation proceedings is an agreement under S. 10A of the Industrial Disputes Act, 1947.

Headnote:
INDUSTRIAL DISPUTES ACT, 1947 - S. 10A - ARBITRATION AGREEMENT - INTERPRETATION - AGREEMENT TO REFER DISPUTE TO ARBITRATION DURING CONCILIATION PROCEEDINGS - WHETHER AN AGREEMENT UNDER S. 10A - HELD, YES.
Fact of the Case:

During conciliation proceedings, the management and workers' union agreed to refer the issue of bonus to the decision of the Assistant Commissioner of Labour (Conciliation). The Assistant Commissioner of Labour passed an award directing payment of Rs. 17 lakhs as bonus. The management challenged the award by filing a writ petition under Art. 226 of the Constitution of India, contending that the reference to arbitration was not under S. 10A of the Industrial Disputes Act, 1947 (the Act) and that the award was, therefore, not amenable to judicial review.
Finding of the Court:

The court held that the agreement to refer the dispute to arbitration was an agreement under S. 10A of the Act. The court noted that the dispute related to bonus, which is an industrial dispute, and that the agreement was entered into during conciliation proceedings, which is a statutory mechanism for resolving industrial disputes. The court also noted that the agreement complied with the requirements of S. 10A(1) and (2) of the Act, and that the fact that the agreement was not forwarded to the Government or the other officers referred to in sub-s. (3) of S. 10A and that the agreement or the award also was not published in the Gazettee, did not invalidate the arbitration agreement or take it outside the purview of S. 10A.
Issues: Whether the agreement to refer the dispute to arbitration was an agreement under S. 10A of the Industrial Disputes Act, 1947.
Ratio Decidendi: The court held that the agreement to refer the dispute to arbitration was an agreement under S. 10A of the Act because: * The dispute related to bonus, which is an industrial dispute. * The agreement was entered into during conciliation proceedings, which is a statutory mechanism for resolving industrial disputes. * The agreement complied with the requirements of S. 10A(1) and (2) of the Act. * The fact that the agreement was not forwarded to the Government or the other officers referred to in sub-s. (3) of S. 10A and that the agreement or the award also was not published in the Gazettee, did not invalidate the arbitration agreement or take it outside the purview of S. 10A.
Final Decision: The court held that the writ petition was maintainable and referred the matter back to the single Judge for disposal on merits.

Judgment :-

V. Ramaswami, J.

In respect of payment of bonus for the accounting year that ended with 31-12-1974, a dispute arose between the management of Enfield India Limited, Tiruvottiyur and their workmen represented by Enfield Employees' Union and Assistant Commissioner of Labour (conciliation), Madras, held conciliation proceedings. As a result of the conciliation talks the parties arrived at what they termed as a settlement on 28-2-1976. Clause 1 of the said settlement is as follows

"Both parties agree to settle the issue of bonus for the accounting year ending 31-12-1974 by leaving it to the decision of the Asst. Commissioner of Labour (Conciliation) Madras, and his decision in this issue will be final and binding on the parties." *

This was signed by the representatives of the management and the representatives of the workers union. The Assistant Commissioner of Labour, in his proceedings dated 28-2-1976, referred to this agreement as memorandum of settlement arrived at under S. 12(3) of the Industrial Disputes Act, 1947 (hereinafter called the Act). In pursuance of this agreement, the parties to the dispute were heard by the Assistant Commissioner of Labour on 2-3-1976 and he passed an award on 18-3-1976. The award directed that the issue of bonus for the accounting year 1974 shall be settled on the basis of payment of Rs. 17 lakhs as bonus. It is to quash this award W.P. 1380 of 1976 was filed under Art. 226 of the Constitution of India. It may be mentioned at this stage that the petitioner in the affidavit originally filed in support of the writ petition raised two alternative contentions - firstly. The reference to the arbitrator was not under S. 10A of the Act but it was only an informal arbitration and that, therefore, he had no jurisdiction to decide an industrial dispute at such informal arbitration not withstanding the consent of the parties. Alternatively, he contended that on the assumption that it is a reference to arbitration under S. 10A, the arbitrator should have insisted upon compliance with the provisions of S. 10A before entering upon his duties. He had raised a number of other contentions on merits with which we are not concerned

2. In the counter-affidavit fixed by the respondent it was contended that since the Asst. Commissioner of Labour acted only as an informal arbitrator and not as an arbitrator with statutory status under S. 10A, no writ will lie against his award. It was also contended that the provisions of the Arbitration Act, 1940 also would not apply as it is an industrial arbitration. When the matter came up for hearing before Mohan, J., the learned Judge considered that because of conflict of decisions on the maintainability of a petition under Art 226 of the Constitution of India to quash the award of this nature, it would be desirable that the case is decided by a Full Bench. Accordingly the matter has come before us

3. Subsequent to the order of reference but before the petition came up before us for hearing the management filed W.M.P. 6751/76 praying for permission to amend the affidavit filed in support of the writ petition by raising certain additional grounds. In the additional grounds it was contended that an Industrial dispute could be resolved only be settlement or adjudication or arbitration under the Industrial Disputes Act and the Act contemplates arbitration under S. 10A thereof. Since the Assistant Commissioner of Labour had to decide the dispute by virtue of the settlement dated 28-2-1976 he could have acted only as an arbitrator under S. 10A. This contention is denied by the 1st respondent workers union in the counter-affidavit and they reiterate the contention that it was an informal private arbitration falling outside the provisions of S. 10A as well as the Arbitration Act

4. Before us, the learned counsel for the petitioner did not advance any argument that the reference to arbitration was outside S. 10A of the Act and that it was only an informal arbitration which was t

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