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1993 Supreme(P&H) 985

PUNJAB & HARYANA HIGH COURT
Jawahar Lal Gupta, J.
Saraswati Industrial Syndicate Ltd.
Versus
State Of Haryana
Civil Writ Petition No. 5120 of 1989,
Decided On : NOVEMBER 5, 1993

The State Government cannot make a reference to the Labour Court without hearing the management after it has declined to make a reference on an earlier occasion.

Headnote:

INDUSTRIAL DISPUTES ACT, 1947 - SECTION 10 - REFERENCE TO LABOUR COURT - OPPORTUNITY OF HEARING - NECESSITY - STATE GOVERNMENT CANNOT MAKE REFERENCE WITHOUT HEARING MANAGEMENT AFTER IT HAS DECLINED TO MAKE REFERENCE ON AN EARLIER OCCASION.

Fact of the Case:

The petitioner, Saraswati Industrial Syndicate, Yamuna Nagar, terminated the services of respondent No.2 vide order dated November 7, 1978. The workman challenged this order and served a notice of demand under Sec.2-A of the Act. The Government declined to make a reference. The workman filed a writ petition which was dismissed. The workman served a fresh notice of demand in February 4, 1988. The Government again declined to make a reference. Despite this, the Government referred the earlier demand notice dated November 7, 1979 for adjudication to the Labour Court without affording any opportunity of hearing to the petitioner management.

Finding of the Court:

The State Government did not afford any opportunity of hearing to the petitioner before passing the impugned Order.

Issues: 1. Whether the State Government can make a reference to the Labour Court without hearing the management after it has declined to make a reference on an earlier occasion? 2. Whether it is necessary to grant an opportunity to the management before making a reference?

Ratio Decidendi: 1. The State Government does not exercise any judicial or quasi-judicial functions when it considers a matter under Sec.10 of the Act. However, the order passed by the Government has serious consequences for the parties. It affects the rights of the management as well as the workman. It is only fair that the appropriate authority gives an opportunity to both the sides to put forth their respective view points so that the relevant material is placed before it for consideration. 2. Even an administrative authority cannot act arbitrarily or capriciously. It must act fairly. If its order has civil consequences, it must abide by the principles of natural justice. In this view of the matter, it appears clear that the appropriate authority must afford some opportunity to the person who is likely to be affected by its order. Before making a reference, the management or the employer has a right to be heard.

Final Decision: The writ petition is allowed. The orders of reference are set aside.

Judgment

Jawaharlal Gupta, J.

1. These four civil writ petitions Nos.5120, 359 to 361 of 1989 are directed against the action of the State Government in making a reference regarding the validity of the termination of the services of the respondent-workman to the Labour Court. The short question raised in these petitions is can the Government make a reference to the Labour Court without hearing the management after it has declined to make a reference on an earlier occasion? A few facts as stated in Civil Writ Petition No.5120 of, 1989 may be noticed.

2. The Saraswati Industrial Syndicate, Yamuna Nagar, is the petitioner. It terminated the services of respondent No.2 vide order dated November 7, 1978. The workman challenged this order. He served a notice of demand dated November 7, 1979 under Sec.2-A of the Act, The matter was considered by the Conciliation Officer. The Government vide its order dated January 11.1980 declined to make a reference. Aggrieved by the order of the Government, the workman filed Civil writ Petition No.3216 of 1987. (p-3) The Division Bench vide its order dated September, 17, 1987 dismissed the writ petition. Undaunted, the workman served a fresh notice of demand in February 4, 1988. This notice was slated to be in continuation of the earlier notice dated November 7, 1979. The petitioner as well as the workman appeared before the Conciliation Officer. The management filed its written comment on February 16, 1988. The State Government considered the matter. Vide order dated May 10, 1988, the Government declined to make a reference. A copy of this order has been produced on record as Annexure p-6. The petitioner avers that despite the above facts, the Government "by an exparte order without affording any opportunity of hearing to the petitioner management referred the earlier demand notice dated November 7, 1979 for adjudication to the Labour Court - respondent. This reference has been made on January 31, 1989 which is after about eight months from the date when the State Government had earlier rejected the demand notice for reference vide Annexure P-6. A copy of this order has been produced as Annexure P - 7 with the writ petition. It has been challenged as being totally arbitrary, illegal and violative of the principles of natural justice.

3. Separate written statements have been filed on behalf of the State Government and the workman. It has been inter alia averred that the State Government exercises administrative functions under Sec.10 of the Industrial Disputes Act, 1947 and it has the jurisdiction and power to review its earlier orders. It has also been averred that it is not required that "there must be some fresh ground or material or record justifying review by the Government on a previous (P-4) refusal of reference. " The respondents maintain that the decision of the Government being administrative in nature, it is beyond the pale of judicial scrutiny. In reply to the specific averment of the petitioner that no opportunity was granted before passing the impugned order, it has been mentioned that the hearing had been granted by the Conciliation Officer.

4. I have heard learned counsel forthe parties.

5. Mr. Pawan Mutneja, learned counsel for the petitioner, has contended that the action of the respondents in passing the impugned order without the grant of any opportunity whatsoever is violation of the principles of natural justice and cannot be sustained. On the other hand, Mr. R. P. Bali, learned counsel for the respondent-workman, has submitted that the Conciliation Officer had heard the petitioner before passing the impugned order.

6. It is clearly established on the record that the State Government had declined to make a reference vide its order dated January 11, 1980 a copy of which has been produced as Annexure P-3 with the writ petition. This order was challenged by the respondent-workman in Civil Writ Petition No.3216 of 1987 along with three other cases including Civil Writ Petition No.3












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