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PETITIONER:

G.S. DHARA SINGH

Vs.

RESPONDENT:

E.K. THOMAS & ORS.

DATE OF JUDGMENT09/08/1988

BENCH:

VENKATARAMIAH, E.S. (J)

BENCH:

VENKATARAMIAH, E.S. (J)

DUTT, M.M. (J)

CITATION:

1988 AIR 1829 1988 SCR Supl. (2) 258

1988 SCC (4) 565 JT 1988 (3) 310

1988 SCALE (2)648

ACT:

Trade Unions Act, 1926: Sections 15 and 18 Trade Union-

Worker resigning from membership-Whether entitled to ask

for account and claim refund of amounts received by trade

union from management.

%

Civil Procedure Code 1908, Section 9.

Central Trade Union Regulations 1938, Regulation ll(i).

Civil suit by workers-Against office bearers of Trade

Union-Claiming refund of amounts received by Union from

management-Maintainability of.

HEADNOTE:

The terms and conditions of service including the rates

of wages and other allied matters were decided and settled

through mutual negotiations between the trade union

represented by respondent No. 3, its General Secretary and

respondent No. 4, President of the Employers Association.

Respondent Nos. 1 and 2 were workers and were members of the

trade union.

Under an agreement entered into in October, 1973 an

amount equivalent to 10 paise out of every rupee earned by

the workers was deducted by the management towards the

gratuity fund and transferred to the trade union for and on

behalf of the workers. Under another agreement a sum

equivalent to 10 paise per rupee in the wages of the workers

was paid by the management to the trade union towards

accident benefit fund of which the workers were the

beneficiaries. The amounts so collected were entrusted to

the petitioner, who was also the treasurer and custodian of

these funds of the trade union. The petitioner deposited

the amounts received by him in his personal name in his bank

account, and no account of these amounts was rendered by him

to the members of the trade union. He did not call any

general body meeting and the members of the trade union

could not ventilate their grievance regarding mismanagement

of the funds.

In view of the aforesaid difficulty, 85 workers

including Respon-

PG NO 258

PG NO 259

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dent Nos. 1 and 2 and three others resigned from this trade

union on January 13, 1976, and formed a separate trade union

of their own and A registered the same under the Trade

Unions Act, 1926.

Respondent Nos. 1 & 2 and three other persons instituted

five suits in the Munsiff Court against the petitioner and

respondent No. 3 for a decree directing the petitioner and

respondent No. 3 to render an account of the amounts

collected on their behalf from December, 1969 towards the

accident benefit fund and from October, 1973’towards the

gratuity fund.

The petitioner who was the President and the Treasurer

of the trade union resisted the suits and contended that

since the plaintiffs had resigned and ceased to be members

of the trade union they had no right to claim the refund of

the sums due to them from out of the funds of the trade

union and that the suits were not maintainable in the Civil

Courts in view of the provisions of the Payment of Gratuity

Act, 1972 and the Workmen’s Compensation Act, 1923.

All these suits were tried together and the Munsiff

passed a preliminary decree against the petitioner and

respondent No. 3 directing them to render an account of the

amounts received by them, and further directed that each of

the plaintiffs was entitled to get his proportionate share

of the amount due to him from out of the total amount

received by the petitioner and respondent No. 3.

The petitioner filed an appeal and the Additional Sub-Judge

f