A.P. Paper Mills Limited, Secunderabad vs Ist Additional District Munsif, Rajahmundry and another

This writ petition is filed by the management of the A.P. Paper Mills Limited, Secunderabad praying for a writ of Prohibition prohibiting the 1st respondent Civil Court from entertaining the suit OS No.649 of 1997 filed by the 2nd respondent and to declare that the said suit is not maintainable and it is impliedly barred by the provisions of the Industrial Disputes Act, 1947 (for short, ''the Act''). It is averred in the affidavit filed in support of the writ petition that there are three recognised trade unions in the petitioner industry.

On 24-1-1993 a settlement was entered into between the management of the petitioner industry and the recognised trade unions in the course of conciliation and that settlement was executed u/s 12(3) of the Act. The term of the said settlement expired on 31-12-1995. Subsequently, again after necessary negotiations before the Commissioner of Labour, a settlement was entered into between the parties on 28-6-1997, and the term of the settlement will be in currency upto 30-6-1999 through the said settlement was brought into force with effect from 1-1-1996. When the matter stood thus, the 2nd respondent trade union which is said to be an unrecognised trade union for the purpose of collective bargaining and having membership of less than 10% of the total work force in the petitioner industry, filed the suit OS No.649 of 1997 in the Court of the I Additional District Munsif, Rajahmundry praying for the following relief:

"VI) The plaintiffs therefore pray that the Hon''ble Court may be pleased to pass a decree and judgment as against the defendants Management as hereunder:

(i) for a declaration that the plaintiffs union members listed in the annexure to the plaint are entitled to the permanent absorption in the first phase commencing from 1-1-1997 and that the permanent absorption of workmen entered into in settlement dated 28-7-1997 is contrary to law and grossly illegal and void ab-initio;

(ii) and for a consequential relief of injunction restraining the defendants management from enforcing the agreement dated 28-7-1997 in respect of permanent absorption of contract, casual, badli and temporary staff;

(iii)for costs of the suit;

(iv) and for such other reliefer reliefs as the Hon''ble Court deems fit and proper in the circumstances of the case."

Hence, this writ petition praying for the reliefs noted above.

Sri V. Srinivas, learned Counsel for the petitioner placed two contentions while assailing the maintenance of the suit. They are :

(I) that the civil Courts jurisdiction into entertain the dispute is impliedly ousted by the provisions of the Industrial Disputes Act;

(II) that the settlement entered into between the management of the petitioner industry and the recognised trade unions dated 28-6-1997 u/s 12(3) of the Act is binding on the 2nd respondent union and its members.

On the other hand, Sri Prabhakar Rao, learned Counsel appearing for the 2nd respondent trade union submitted that the terms of the settlement dated 28-6-1997 do not bind the members of the 2nd respondent trade union and even the terms of the settlement are not properly implemented.

Adverting to the first contention of the learned Counsel for the petitioner, it is apt to note the principles stated by the Supreme Court in the case of Rajasthan State Road Transport Corporation and Another Vs. Krishna Kant and Others, of the said judgment reads :

"32 We may now summarise the principles flowing from the above discussion :

(1) Where the dispute arises form general law of contract, i.e., where reliefs are claimed on the basis of the general law of contract, a suit filed in civil Court cannot be said to be not maintainable, even though such a dispute may also constitute an "industrial dispute" within the meaning of Section 2(k) or Section 2-A of the Industrial Disputes Act, 1947

(2) Where, however, the dispute involves recognition , observance or enforcement of any of the rights or obligations created by the Industrial Disputes Act, the only remedy.is to approach the forums created by the said Act.

(3) Similarly, where the dispute involves the recognition, observance or enforcement of rights and obligations created by enactments like Industrial Employment (Standing Orders) Act, 1946-which can be called ''Sister enactments'' to Industrial Disputes Act - and which do not provide a forum for resolution of such disputes, the only remedy shall be to approach the forums created by the Industrial Disputes Act provided they constitute industrial disputes within the meaning of Section 2(k) and Section 2-A of Industrial Disputes Act or where such enactment says that such dispute shall be either treated as an Industrial dispute or says that it shall be adjudicated by any of the forums created by the Industrial Disputes Act. Otherwise, recourse to Civil Court is open.

(4) It is not correct to say that the remedies provided by the Industrial Disputes Act are not equally effective for the reason that access to the forum depends upon a reference being made by the appropriate Government. The power to make a reference conferred upon the Government is to be exercised to effectuate the object of the enactment and hence not unguided. The rule is to make a reference unless, of course, the dispute raised is a totally frivolous one ex facie. The power conferred is the power to refer and not the power to decide, though it may be that the Government is entitled to examine whether the dispute is ex facie frivolous, not meriting an adjudication.

(5) Consistent with the policy of law aforesaid, we command to the Parliament and the State Legislature to make a provision enabling a workman to approach the Labour Court/Industrial Tribunal directly - i.e., without the requirement of a reference by the Government - in case of industrial disputes covered by Section 2-A of the Industrial Disputes Act. This would go a long way in removing the misgivings with respect to the effectiveness of the remedies provided by the Industrial Disputes Act.

(6) The certified Standing Orders framed under and in accordance with the Industrial Employment (Standing Orders) Act, 1946 are statutorily imposed conditions of service and arc binding both upon the employers and employees, though they do not amount to "statutory provisions". Any violation of these Standing Orders entitles an employee to appropriate relief either before the forums created by the Industrial Disputes Act or the Civil Court where recourse to civil Court is open according to the principles indicated therein.

(7) The policy of law emerging from Industrial Disputes Act and its sister enactments is to provide ah alternative dispute resolution mechanism to the workmen, a mechanism which is speedy, inexpensive, informal and un-encumbered by the plethora of procedural laws and appeals, upon appeals and revisions applicable to civil Courts. Indeed, the power of the Courts and Tribunals under the Industrial Disputes Act are far more extensive in the sense that they can grant such relief as they think appropriate in the circumstances for putting an end to an industrial dispute."

In my considered opinion, the principles (1) and (4) stated in para 32 of the judgment squarely cover the facts of this case also. It is needless to state that settlement arrived at in the course of conciliation and executed between the parties u/s 12(3) of the Industrial Disputes Act has a statutory force, and therefore, it can be safely be said that the dispute which is carried before the Civil Court by the 2nd respondent by filing the suit involves recognition, observance or enforcement or the rights and obligations created by the Industrial Disputes Act.

The second contention of the learned Counsel for the petitioner is also well founded. Section 18(3) of the Industrial Disputes Act provides that the settlement arrived at in the course of conciliation proceedings under the Act among other things shall be binding on all parties to the Industrial Dispute, all other parties summoned to appear in the proceedings as parties to the dispute. Interpreting the provisions of sub-section (3) of Section 18 of the Act, the Supreme Court repeatedly held that the terms of the settlement arrived at between the management and the collective bargaining agents should bind not only the collective bargaining agents but also the others. The decisions of the Supreme Court in Barauni Refinery Pragatisheel Shramik Parishad Vs. Indian Oil Corporation Ltd., , General Manager, Security Paper Mill, Hoshangabad Vs. R.S. Sharma and Others, , and P. Virudhachalam and Others Vs. Management of Lotus Mills and Another, are the authorities, to cite the few.

Even assuming that the terms of the settlement dated 28-6-1997 are operating to the prejudice of the members of the second respondent trade union and that the terms of the settlement are not fairly implemented towards the members of the 2nd respondent trade union, even then, the proper remedy for the 2nd respondent union and its members is to seek reference for industrial adjudication as held by the Supreme Court in para 32 of the judgment (supra).

In the result, I hold and declare that the jurisdiction of the civil Court, the 1st respondent herein to entertain the suit OS No.649 of 1997 instituted by the 2nd respondent trade union in the Court of the I Additional District Munsif, Rajahmundry is impliedly ousted. All the contentions touching the merits of the allegations of the 2nd respondent about the enforcement of the terms of the settlement are kept open to be agitated in appropriate proceedings. Liberty is also reserved to the 2nd respondent to seek reference of their dispute for industrial adjudication, if it so advised.

The writ petition is accordingly disposed of. No costs.