Commr., Coimbatore Municipal Corpn. vs Presiding Officer, Labour Court and Others

Janarthanam, J.—The jurisdictional or foundational facts, giving rise to these writ petitions, if stated in a succinct fashion, the tangle posed in

all those writ petitions, could be solved with ease and grace and a task towards that end may now be undertaken.

One K. Thiruvenkataswami was an employee of the erstwhile Coimbatore Municipality (now is a Corporation) working in the Electricity

Department. He was working at the relevant tune as a wireman and he attained the age of 55 years on December 26, 1966. It was proposed to

retire him from service in terms of the rules framed by the Province of Madras in exercise of the powers conferred on it by Section 74 of the

Municipalities Act, since the age of superannuation for the municipal employees under Rule 14 of the said rules was attainment of 55 years of age.

Against the proposed retirement, he filed W.P. No. 2746 of 1966 contending that Standing Order 21 of the Model Standing Orders, which

prescribed the age of superannuation at the attainment of 58 years applied to him and therefore, he ought not to be retired on his attaining the age

of 55.

The said Writ Petition came up for disposal before Kailasam, J., (as he then was) and learned Judge posed for consideration the question

whether Electricity Department of Coimbatore Municipality was an ""industrial establishment"", falling within the scope of the Standing Orders Act

and answered the same in favour of the petitioner in the writ petition. Learned Judge also took the view that the Standing Orders Act, being a

special enactment, would prevail over the earlier general Act and the provisions of the Municipalities Act and the rules framed thereunder which

are not in conformity with the Standing Orders Act and the Model Standing Orders will not apply. The said judgment of Kailasam, J., is reported

as Thiruvenkataswami (K.) Vs. Coimbatore Municipality, .

Coimbatore Municipality did not leave the matter there and it agitated the matter further by way of filing an appeal, being W.A. No. 503 of

1967. This writ appeal came before a Division Bench consisting of Ismail J., (as he then was) and Palaniswami, J. The Division Bench, on an

elaborate consideration expressed a view, quite contrary to that of Kailasam, J. on both the points. The Bench, while holding that the Electricity

Department of Coimbatore Municipality was not an industrial establishment, falling within the scope of the Standing Orders Act, expressed the

rationale for such an approach thus:

In our opinion purely as a matter of construction of the various statutory provisions, the following features must be present before the Standing

Orders Act can apply:

There must be a fixed site or place or building which can be said to be an establishment:

In such an establishment any work relating to the generation, transmission and distribution of electricity or any other form of power should be

carried on, as far as the payment of Wages Act, 1936 is concerned:

In any part of such premises manufacturing process as defined in Section 2(k) of the Factories Act, 1948, should be carried on; and on such

premises ten or more workers must be working or must have been working on any day of the preceding twelve months, if the manufacturing

process is being carried on with the aid of power and twenty or more workers must be working or must have been working on any day of the

preceding twelve months, if the manufacturing process is being carried on without the aid of power, if the definition of the term factory is to become

an industrial establishment under the Standing Orders Act, and

Whether it is a factory as defined in the Factories Act, 1948, or an industrial establishment as defined in the Payment of Wages Act, 1936, in

such an industrial establishment one hundred or more workmen must be employed or must have been employed on any day of the preceding

twelve months, vide Section 8(8) of the Standing Orders Act.

These arc facts to be established by affidavit or evidence and none of those facts was present in the case before Kailasam, J., and

consequently we have no hesitation in holding that the conclusion of the learned Judge that Standing Orders Act and the model standing order

applied to the Electricity Department of the Coimbatore Municipality is not correct.

For arriving at the same conclusion, the Bench adopted a different methodology and approach, which is reflected thus:

(54) There is yet another method of approach. The Municipalities Act is a State enactment dealing with the Municipalities in the State and their

employees. On the other hand, the Standing Orders Act is a Central enactment applicable throughout the territory of India in respect of industrial

establishments coming within the scope of that Act. From this point of view, it can be said that the rules framed by the Provincial Government in

exercise of powers conferred on it u/s 74 of the Municipalities Act constitute a special law, while the model standing orders would constitute a

general law and on the basis of the principle ""that the special excludes the general, it is the rules made by the Provincial Government which will

prevail over the model standing orders. Kailasam, J., has taken a directly contrary view by holding that the Standing Orders Act is a special

enactment, while the Municipalities Act is general enactment. For the purpose of coming to the conclusion which we do, we take note of the extent

of operation of the Acts as well as the persons to whom the Acts are applicable and once those factors are taken into account, we are clearly of

the opinion that the rules made under the Municipalities Act alone will constitute the special law and not the Model Standing Orders. We have

already referred to Section 15 of the Standing Orders Act which confers power only on the appropriate Government to make rules setting out the

Model Standing Orders, and in exercise of this power alone the Provincial Government has made the model standing orders. Thus the very

Provincial Government in exercise of the powers conferred upon it u/s 74 of the Municipalities Act has prescribed the age of superannuation for

municipal employees at 55 years while under Standing Orders framed under the Standing Orders Act it has prescribed the age of superannuation

for the employees in industrial establishments coming within the scope of that Act at 58 years. This again is a circumstance indicating that the two

operate in two independent and separate fields and they do not apply to one and the same situation or person.

(55) Therefore, disagreeing with Kailasam, J., we hold that the rules framed by the Provincial Government u/s 74 of the Municipalities Act

prescribing the age of superannuation at 55 for the employees of the Municipal Councils will alone apply to the petitioners herein and not the

Model Standing Order 21 prescribing the age of superannuation at 58.

The Bench decision in Coimbatore Municipality v. Thiruvenkataswami, is reported in ILR (1973) Mad 405.

Certain erstwhile employees of the Electricity Department in Coimbatore Municipality, namely N. Murugesan, M. Ramaswamy (since

deceased) R. Jagadambal and R. Thirumurthy having been substituted in his place as per order of court dated July 29,1987 in W.M.P. No. 2499

of 1986 herein), P.K. Kuppusamy, M.K. Kunjahamed, V.K. Subramaniam, K. Chinnannan, K.G. Varghese, C.K. Natarajan and R.

Venkataraman (Respondents 2 in W.P. Nos. 7452 to 7460 of 84 respectively) who were permitted to retire on their attainment of 55 years of age

in superannuation, by issue of a notification came forward by filing writ petitions, being W.P. Nos. 712 of 76, 4476 of 1974, 4072 of 1974, 167

of 1977, 171 of 1977, 444 of 1977, 934 of 1978, 1670 of 1977 and 4113 of 1975 on similar grounds.

W.P. Nos. 712 of 1976, 4113 of 1975 and 4476 of 1974 came up for final hearing before Koshal, J., who in turn, dismissed them by order

dated February 7, 1977, The said order was agitated further in Appeal Nos. 27 to 29 of 1977. These writ appeals came up for hearing before

P.R. Gokulakrishnan, J., and Ratnam, J., (as they then were). Their Lordships of the Division Bench framed two substantial questions arising for

consideration, in the light of the subsequent pronouncement of the apex of the judicial administration of this country, referred the matter to be

posted before a Full Bench by expressing thus:

In these writ appeals, the two substantial questions that arise for consideration are, (1) whether a department of a municipality dealing in the

distribution of electricity will come under the Industrial Employment (Standing Orders) Act, 1946 (Central Act 20 of 1946) and if so, whether the

provisions of the said Act are applicable and (2) whether a department of the Municipality which is within the municipal administration having

various other departments like that, can be singled out for the purpose of applying the provisions of the Industrial Employment (Standing Orders

Act, 1946). A Division Bench of this Court in Coimbatore Municipality v. Thiruvenkataswami (supra), has held in respect of the very same

municipality which is now litigating the matter, that the District Municipalities Act, being a special law, is applicable and not the Industrial

Employment (Standing Orders) Act, 1946, which is a general law. The view that the Industrial Employment (Standing Orders) Act, 1946 is a

general law as compared to the District Municipalities Act is no longer a good law in view of the categorical decision of the Supreme Court in U.P.

State Electricity Board v. Hari Shankar Jain, 1979 H LLJ 399, to the effect that the Industrial Employment (Standing Orders) Act, 1946 is a

special enactment and the District Municipalities Act has to be construed only as a general one. The view of a Division Bench of this Court in

Coimbatore Municipality v. Thiruvenkataswami (supra) that the particular department within the Municipality cannot attract the benefit under the

Industrial Employment (Standing Orders) Act, 1946, has to be decided by a Fuller Bench of this Court in view of the decision rendered by the

Supreme Court in Ardeshir H. Bhiwandiwala Vs. The State of Bombay, , The Corporation of the City of Nagpur Vs. Its Employees, and Dr.

Devendra M. Surti v. State of Gujarat, 1969 H LLJ 116. Since we are of the view that the decision rendered by a Division Bench of this Court in

Coimbatore Municipality v. Thiruvenkataswami (supra) requires reconsideration in the light of the decisions of the Supreme Court referred to

above, we direct that this matter may be posted before a Fuller Bench on April 5, 1982 for a decision on the questions raised.

As a consequence, these writ appeals alongwith all other Writ Petitions on the subject, came to be posted before the Full Bench of this Court

consisting of Gokulakrishnan, J., Ratnam, J., (as they then were) and Fakkir Mohammed, J. The Full Bench framed the following questions for

consideration.

(1) Whether the electrical undertaking of a Municipality will be an industrial establishment within the meaning of the Industrial Employment

(Standing Orders) Act 1946 (hereinafter referred to as ''the Standing Orders Act'') and if so, whether the provisions of the Standing Orders Act

and the Model Standing Orders thereunder, are applicable to the workmen therein?

(2) Whether a department of a Municipality like its Electrical undertaking, forming part of the entire Municipal Administration, can be subjected to

the provisions of the Standing Orders Act? and (3) Whether the provisions of the Standing Orders Act will prevail over the provisions of the Tamil

Nadu District Municipalities Act and the rules framed thereunder in their applicability to such municipal electrical undertakings?

The Full Bench chose to answer the third and last question as below:

Applying the ratio of the decision of the Supreme Court in U.P. State Electricity Board v. Hari Shankar Jain and Ors., 1979 II LLJ 399 referred

to earlier, we hold on the third question set out at the beginning that the provisions of the Standing Orders Act, if applicable to a municipal

undertaking as an ""industrial establishment"" defined in the Standing Orders Act, being in the nature of a special enactment, will prevail over the

provisions of the District Municipalities Act and the rules thereunder and to this extent, the decision of the Division Bench in Coimbatore

Municipality v. Thiruvenkataswami, ILR (1973) Mad. 405 is not correct.

The Full Bench did not however choose to answer the first two questions and the reasons why those questions were not answered were given

by the Full Bench by expressing thus:

We are of the opinion that in the events which have taken place since the filing of this batch of writ petitions and writ appeals, it will be a totally

futile and purely academic exercise to proceed to consider and answer questions 1 and 2 set out in the beginning of this judgment. The challenge in

the writ petitions as well as the writ appeals by the petitioners and the appellants was against the orders of the concerned municipalities to the effect

that all of them should retire on the attainment of the age of 55 years. This was based on the ground that the municipal electrical undertakings will

be ''industrial establishment'' within the meaning of Standing Orders Act, 1946 and Model Standing Order No. 21 would apply so that the benefit

of a higher age of superannuation at 58 would be available to them. At the time when these writ petitions as well as the writ appeals had been filed,

the petitioners in the writ petitions as well as the appellants in the writ appeals had almost completed 55 years of age and since the filing of the writ

petitions and the writ appeals, all of them had completed 58 years also. In other words, the petitioners in the writ petitions as well as the appellants

in the writ appeals have not only crossed the retirement age of 55 years in accordance with the municipal rules but also the higher age limit of 58

years, if the provisions of the Standing Orders Act were to apply to the municipal electrical undertakings in which they were employed. It is not in

dispute that on the completion of 58 years, the petitioners in these writ petitions as well as the appellants in the writ appeals had retired from

service. As none of the petitioners in these writ petitions and the appellants in the writ appeals continued to remain in service, as pointed out earlier,

it would be an exercise in futility to go into the question whether the municipal electrical undertakings of the erstwhile Coimbatore and Madurai

Municipalities and Thanjavur Municipality would be industrial establishment within the meaning of the Standing Orders Act, as even on the

assumption that they are so, the petitioners in the writ petitions and the appellants in the writ appeals cannot be granted any relief, as the only relief

asked for by them was that they should have the benefit of the higher age of superannuation at 58 instead of 55. That they have already secured. It

is also not the case of any of the petitioners in these writ petitions or the appellants in these writ appeals that though as on date they had completed

55 years they had not attained 58 years and therefore, question Nos. 1 and 2 set out earlier would still be relevant and remain alive for

consideration. A faint attempt was no doubt made by the learned counsel for the petitioners in these writ petitions as well as the appellants in the

writ appeals that they may be eligible for some higher or better retirement benefits and therefore, question Nos. 1 and 2 should also be considered

and decided. We are not inclined to consider those questions merely from the point of view of the possibility of the writ petitioners in these writ

petitions and the appellants in the writ appeals securing some better retirement benefits for, we do not know what they are, as in none of the writ

petitions or even in the writ appeals, that question had been raised. To the extent to which the petitioners in the writ petitions and the appellants in

the writ appeals wanted the benefit of the higher age of superannuation at 58 years, they have already secured it during the pendency of the writ

petitions and writ appeals and therefore, no useful purpose will be served by an academic consideration of the correctness or otherwise of the

decision of the Division Bench in Coimbatore Municipality v. Thirvenkataswami ILR (1973) Mad. 405: (supra) on the other two questions viz.,

whether the municipal electrical undertakings would be industrial establishments within the meaning of the Standing Orders Act and whether a

department of the municipality like the municipal electrical undertaking can be subjected to the application of the provisions of the Standing Orders

Act. In view of this, we are of the opinion that question Nos. 1 and 2 referred to earlier do not require to be considered and answered.

Consequently, we dismiss all the writ petitions as well as the writ appeals. There will be, however, no order as to costs.

Various writ petitioners in the individual writ petitions filed Computation Petition Nos. 70 to 78 of 1992 on the file of the Presiding Officer,

Labour Court, Coimbatore (respondent 1 in all the writ petitions herein) u/s 33-C(2) of the Industrial Disputes Act 1947 claiming incremental

arrears of bonus and encashment of leave salary. On consideration of the materials placed, learned Labour Judge allowed all those petitions as

prayed for in specified sums. Coimbatore Municipality, aggrieved by the said order, came forward with the present actions under Article 226 of

the Constitution praying for issue of writ of certiorari to quash the said order of respondent 1 in those Computation Petitions.

Learned counsel appearing for the petitioner would submit that Section 33-C(2) of the Industrial Disputes Act assumes an existing right in the

employee to the money or benefit and on the basis of this assumption, if a question were to arise as to the amount of money due or as to the

amount at which such benefits should be computed, the section empowers the Labour Court to decide that question and if there is no existing right

to the money or benefit, such right has to be adjudicated upon, then the Labour Court has no power under the section to proceed further or

adjudicate upon that right and such being the legal position, he would further say, that respondent 2 in the various writ petitions herein the erstwhile

employees of the Coimbatore Municipality, ought to have retired in the normal course on the completion of 55 years, the age of superannuation,

inasmuch as the Full Bench dismissed all the writ appeals and writ petitions without answering the first two questions, as posed for consideration,

by holding that such an exercise was not called for, in view of the fact that all of them completed the age of 58 years, the extended age of

superannuation, as claimed for by them long before the said decision, thereby making it fluidly clear that the decision of the Division Bench in W.A.

No. 503 of 67 is still holding the field, as respects the position that the Electricity Department of the erstwhile Coimbatore Municipality is not an

industrial establishment and the provisions of the Tamil Nadu District Municipalities Act would alone be applicable for determining the age of

superannuation of its employees and in that view of the matter, he would further say that respondent 1-Labour Judge had no jurisdiction to award

incremental arrears, arrears of bonus and encashment of leave salary for the extended period of superannuation for three years.

Learned counsel appearing for respondent 2 would however repel such a submission, besides contending that such a question, not having been

raised earlier, it is not at all permissible for the present petitioner to rake up such a question for the first time in these writ petitions when especially

the petitioner, without raising its little finger, submitted to the jurisdiction of respondent 1.

Rival submission of either counsel may now fall for consideration in the arena of discussion. There is no pale of controversy that the respective

respondents 2 in all these writ petitions had the extended period of superannuation by three years, by virtue of their obtaining of the interim orders

of stay from this Court in the writ proceedings. It is also of signal importance to note that at the time of final adjudication, the first two questions

were left unanswered, thereby impliedly not having tilted the binding effect of the Division Bench decision of this Court in W.A. No, 503 of 1967

and such being the case, it goes without saying that all of them were going to retire on the completion of 55 years of age. Unless they are having the

right to continue in service upto the completion of 58 years of age, the question of determination of incremental arrears of bonus and encashment of

leave salary will not arise for consideration. The power of respondent 1 (Labour Court) u/s 33-C(2) of the Industrial Disputes Act, being in the

nature of an executing Court it cannot at all decide the question that they are entitled to get superannuated at the completion of 58 years of age and

such a question has also not rightly been decided. Perhaps respondent 1 (Labour Court) was under the erroneous impression that all of them were

to retire, as a matter of right, on the completion of 58 years of age and on that premise, it allowed all the computation petitions claiming incremental

arrears, arrears of bonus and encashment of leave salary. The fact that respondent 1 (Labour Court) had not the necessary and requisite

jurisdiction to pass orders on all those Computation Petitions having been raised for the first time before this Court is of no consequence, inasmuch

as the question is, pure and simple, a question of law, which could be raised at any stage of the proceedings.

Useful reference may be made at this juncture to the decision of the Supreme Court in the case of Central Inland Water Transport Corporation

Limited Vs. The Workmen and Another, : In that case a reference was made by the State of West Bengal to the Second Labour Court, Calcutta,

u/s 33-C(2) of the Act. Four issues were referred to the Labour Court for adjudication. The first issue raised was the question whether the

undertaking of the company had been transferred to the Corporation and, if so, whether the settlement of a certain date between the company and

the Union was binding on the Corporation. By the second issue, the question was raised whether a certain number of employees who were parties

to the settlement were entitled to continue in the employment of the Corporation and, if so, to what amount, they were entitled. The Labour Court

was further asked to adjudicate whether the amount so computed was money recoverable from the Corporation. By the third issue the question

was raised whether a certain number of employees mentioned in certain list, who were not parties to the settlement, were entitled to get

compensation u/s 25-FF of the Act and, if so, what was the amount to which they were entitled? By the fourth issue the Labour Court was invited

to adjudicate whether the undertaking of the company had been closed within the contemplation of Section 25-FF of the Act and, if so, what

amount of compensation the workmen were entitled to?

The Supreme Court observed that a proceeding u/s 33-C(2) was a proceeding in the nature of an execution proceeding wherein the Labour

Court calculates the amount of money due to a workman from his employer, or if the workman is entitled to any benefit, which is capable of being

computed in terms of money, the Labour Court proceeds to compute the benefit in terms of money. This calculation or compulation ""follows upon

an existing right to the money or benefit, in view of its being previously adjudged, or, otherwise duly provided for"".

The Supreme Court held that most of the points referred to the Labour Court in that case u/s 33-C(2) of the Act could not be gone into by

that Court. All that the Labour Court could do u/s 33-C(2) of the Act was to compute the benefit, if there was already an adjudication in favour of

the workman as against the Corporation or the said benefit was otherwise provided for as payable by the Corporation.

The above decision of the Supreme Court thus reiterates that the Labour Court u/s 33C(2) can merely calculate the amount of money due to a

workman from his employer or if the workman is entitled to a benefit, which is capable of being computed in terms of money, Labour Court can

proceed to compute the benefit in terms of money. But all the same, this calculation or computation can follow only upon an existing right to the

money or benefit.

For the reasons, as above, all the writ petitions deserve to be allowed and they are accordingly allowed. Rule Nisi issued earlier are made

absolute. No order as to costs is, however, made in all these writ petitions.