Elphinstone Spinning and Weaving Mills Company Ltd. vs Its Workmen

This industrial dispute was referred to me under Clause (d) of Sub-section (1) of S. 10 of the Industrial Disputes Act, 1947, by the Labour and Social Welfare Department Order No. AJE. 1758, dated 2 February, 1959. The demands of the workmen will be reproduced in due course.

A preliminary point was argued by Sri K. P. Sachindranath for the workmen and Sri Lilaoowala for the company as to whether this division should be treated as a separate concern altogether or as part and parcel of the mills company. In the year 1957 a dispute between the same parties had been referred to me over the demand for a wage-scale for watchmen of this division [Reference (I.T.) No. 217 of 1957]. I gave my award on 1 March, 1958. I made the following observations in that award :-

Paragraph 8.- "The leather cloth division of the Elphinstone Spinning and Weaving Mills Company was started in the year 1950. It actually went into production in the year 1951."

Paragraph 6.- "In the first place it is to be noted that the present concern is only a division of the Elphinstone Spinning and Weaving Mills Company, Ltd. It is true that a company may start an altogether different line of business and keep it a distinct unit. In that case it would not be proper to consider that unit as part and parcel of the original concern. But in the present case, the concern before me is described as a division. The accounts of this division may be kept distinct but that would not make it a distinct unit. The profit or loss of this division would be entered in he accounts of the mills company. In the case of the Baroda Borough Municipality Vs. Its Workmen, it was urged before their lordships of the Supreme Court that ..."

Page 18. - "As a matter of fact the Baroda municipality kept separate accounts with regard to its electrical undertaking, including a capital account showing capital expenditure and capital receipts; separate accounts were also kept of the reserve fund, etc. It was argued that the maintenance of these separate accounts showed that the Baroda municipality did treat the income of the electricity department separately from that of other departments, and the maintenance of such accounts did not contravene any of the provisions of the Municipal Act."

Their lordships observed :

"In our opinion, these submissions are based on a misappreciation of the true position in law. With regard to the first point it is worthy of note that the maintenance of separate accounts of a particular department by the municipality does not alter the nature or quality of the property or income therefrom. The property or income is still municipal property within the meaning of Ss. 63 and 65 of the Municipal Act ... Maintenance of a separate account for a particular department is in the nature of an internal accounting arrangement. It does not really alter the quality or nature of the property or income.

It must therefore be held that the leather cloth division is only a department of the Elphinstone Spinning and Weaving Mills Company, Ltd."

The question now arises is, can the same point be reagitated over again by the same parties ? In my opinion, it cannot, be reagitated because the principle of res judicata as expounded by the Supreme Court in the case of Burn and Co., Calcutta Vs. Their Employees, would apply. Their lordships observed as follows :

Page 229. - "... there is no provision in the statute prescribing when and under what circumstances an award could be reopened. Section 19(4) authorizes the Government to move the tribunal for shortening the period during which the award would operate, if there has been a material change in the circumstances on which it was based. But this had reference to the period of one year fixed under S. 19(3) and if that indicates anything, it is that that would be proper ground on which the award could be reopened under S. 19(6) ... But we propose to consider the question on the footing that there is nothing in the statute to indicate the grounds on which an award could be reopened. What then is the position ? Are we to hold that an award given on a matter in controversy between the parties after full hearing ceases to have any force if either of them repudiates it under S. 19(6), and that the tribunal has no option when the matter is again referred to it for adjudication, but to proceed to try it de novo, traverse the entire ground once again, and come to a fresh decision. That would be contrary to the well-recognized principle that a decision once rendered by a competent authority on a matter in issue between the parties after a full enquiry should not be permitted to be reagitated. It is on this principle that the rule of res judicata in S. 11 of of the CPC is based. That section is, no doubt, in terms inapplicable to the present matter, but the principle underlying it, expressed in the maxim interest rai publicae ut sit finis litium is founded on sound public policy and is of universal application."

Then their lordships modify the principle by laying down that the rule of res judicata should not apply if there are sufficient grounds to show that circumstances have changed since the matter was first adjudicated upon. No such grounds have been put forward by Sri Lilaoowala and therefore I hold that I cannot allow the question to be reagitated in this proceedings. The leather cloth division must be treated as part and parcel of the Elphinstone Spinning and Weaving Mills Company, Ltd.

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