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Judgment
Chander Shekhar, J
The petitioner has filed the present petition under Articles 226 and 227 of the Constitution of India to set aside and quash the Award dated
07.03.2005 passed by the Presiding Officer, Industrial Tribunal-II, Delhi (in short, called “the Tribunalâ€).
I have heard the learned counsels for the parties and have also gone through the written synopsis filed by them.
The claim of the workmen and written statement of the Management as noticed by the Tribunal is as follow:-
“2. In statement of claim it is submitted that the claimants are permanent employees of Hotel Corporation of India Ltd., Chefair Flight
Catering and are being represented by Hotel Corporation of India Karamchari Union. It is submitted that the management is having its
several units situated at Indira Gandhi International Airport, Gurgaon Road, New Delhi. The pay and allowance of the claimant have
undergone change/revision from time to time persuasion of wage negotiation between the management and union. It is submitted that there
is a settlement on 3.11.2000 between the management and union to some of the term and condition of the service of workmen including the
pay and allowances and the settlement was duly registered with Govt. of NCT of Delhi on 11.5.2001. It is submitted that settlement makes a
provision for providing up to a maximum of three stagnation increments to those employees who are stagnated. The management has
decided to grant stagnation increment in every year of service w.e.f. 1.2.1997 and the same was given for a period of one year, however,
after one year the management has withdrawn the same and the payment made was recovered from the employees. It is submitted that the
management has failed to implement the provision of the settlement and did not grant the revised scale w.e.f. 1.2.1997 for every year
increment. It is submitted that the management has illegally withheld the revised pay scales of the workmen.
Management has filed the written statement in which it is submitted that the management and union arrived at an amicable settlement and
signed a memorandum of understanding on 3.11.2000. The said settlement was registered on 5.11.2000 and it came into force w.e.f.
1.2.1997. In the settlement it was provided that in case of employee who are stagnated upto a maximum of 3 stagnation increment will be
given for those who reach the maximum of their pay scale. It is submitted that the stagnation increment was given to the employees, however,
the said increment was rectified as per provisions, laid down in Regulation No.46 of Employees Service Regulation, which read as under:-
“Subject to the general conditions laid down in Regulation No.44(1) and the provisions of sub-regulation (ii) hereof, the
employees of such categories as may be specified by the Corporation for a secretary increment of every three year’s service from the
date on which they reach the maximum of their grade.â€
It is submitted that as per General Clause (2) of General Conditions of settlement, the union has agreed that all the employees will refund
any excess amount received by them. The employees in their individual capacity also gave their undertaking to that effect. It is denied that
the management in any way has reduced the basic pay of the employees, however, appropriate rectifications were made in regard to
stagnation increment. It is submitted that the management has fully implemented the provisions of the agreement and accordingly revised
pay scale has been implemented. It is submitted that the management has not withheld the revised pay scale of the workman as alleged.â€
Ms. Kritika, learned counsel for the petitioner submits that the Tribunal went beyond its jurisdiction after having answered in the negative that the
workmen be given stagnation increment each year, when it further held that the Management is required to be directed to give three stagnation
increments to the workmen alternatively within six years.
Learned counsel for the petitioner also submits that the Tribunal not only exceeded its jurisdiction but also went beyond the Reference by stating
that the workmen be given stagnation increment in alternative years within a span of six years i.e. once in every two years, rather than sticking to
answer whether the workmen are entitled for the stagnation every year or not.
Learned counsel for the petitioner also relied upon judgments titled as Mahendra L. Jain and Others v. Indore Development Authority and Others,
(2005) 1 SCC 639 and State Bank of Bikaner & Jaipur v. Om Prakash Sharma, (2006) 5 SCC 123.
Learned counsel for the petitioner also put reliance upon Clause 46 (i) of Hotel Corporation of India Employees†Service Regulation which reads
as under:-
“46(i) Subject to the general conditions laid down in regulation 44(i) into the provisions of sub regulation (ii) hereof, the employees of
such category as may be specified by the corporation for a secondary increment for every 3 years service from the date of which they reach
the maximum of their grade.â€
Per contra, learned counsel for the respondent has drawn the attention of this Court towards Memorandum of Settlement dated 03.11.2000
(Annexure â€"I). Relevant portion of Clause (1) (a) of the Settlement reads as under:-
“In case of employees who are stagnated upto a maximum of 3 stagnation increments will be given for those who reach the maximum of
their scales.â€
Learned counsel for the respondent also submitted that Memorandum of Settlement makes a provision for providing upto a maximum of three
stagnation increments to those employees who reach at maximum of their scales. The Management had decided to grant stagnation increment in
every year of service w.e.f. 1.2.1997 and the same was given for a period of one year, however, after one year, the Management had withdrawn the
same and the payment already made was also recovered from the employees.
The aforesaid pleadings clearly demonstrate that the case of the workmen is that they have been given stagnation increment in one year. However,
no case was made out by the parties, more specifically, in the statement of claim by the workmen/respondent that the stagnation increment be given in
alternate years, i.e. once in every two years or that the Management was required to give three stagnation increments to the workmen alternatively
within six years. It is also not the case of the respondent on the record that the stagnation increment was given in alternate years, i.e. once in every
two years. The respondent seems to be aware about the statutory limitation in this behalf in view of the settlement arrived at between the
Management and the Union which was exhibited as Ex.MW1/1, the relevant portion of which has already been extracted above.
The Management has relied upon in its written statement before the Industrial Tribunal, the Regulation No.46 (i) of the Employees†Service
Regulation which reads as under:-
“46(i) Subject to the general conditions laid down in Regulation No.44(1) and the provisions of sub-regulation (ii) hereof, the employees
of such categories as may be specified by the Corporation for a secondary increment of every three year’s service from the date on
which they reach the maximum of their grade.â€
It was also submitted in the written statement that as per general Clause (ii) of the General Conditions of Settlement, the Union has agreed that all
the employees will refund any excess amount received by them. The employees in their individual capacity also gave their undertaking to that effect.
It was denied that the Management, in any way, has reduced the basic pay of the employees; however, appropriate rectifications were made in regard
to stagnation increment. It was also submitted in the written statement that the Management has fully implemented the provisions of the agreement
and accordingly, the revised pay scale has been implemented. The Management has not withheld the revised pay scale of the workmen, as alleged.
Learned counsels for the parties, on the query of the Court, stated that the Memorandum of Settlement is still in force. Learned counsel for the
petitioner submitted that the terms and conditions of the settlement stand implemented and are being complied with. Consequently, the benefits are
being given/ paid by the petitioner to the respondent. Counsel further submitted that in total, three stagnation increments are
being given by the petitioner to the respondent as per their entitlement after every three  years, i.e., once in every three years, in terms of
Regulations 46(i) and 46(ii) of the Staff Regulation of the Hotel Corporation of India Employeesâ€Â Service Regulations.
Learned counsel for the respondent, however, submitted that the Management has not paid stagnation increment to the respondent as per their
entitlement. Counsels for the parties submitted that it is/was not stated anywhere in the pleadings or written submissions or the arguments of the
Management/Petitioner that the case of the Management is  that the stagnation increment is given in alternate years, i.e., once in two years, as
stated in the Impugned Award dated 07.03.2005.
Now, let me examine the law regarding the Reference and the constructions thereof. In the matter of Pottery Mazdoor Panchayat v. Perfect
Pottery Co. Ltd. & Anr., AIR 1979 SC 1356, the Supreme Court has held as under:
“11. Having heard a closely thought out argument made by Mr. Gupta on behalf of the appellant, we are of the opinion that the High
Court is right in its view on the first question. The very terms of the references show that the point of dispute between the parties was not the
fact of the closure of its business by the respondent but the propriety and justification of the respondent's decision to close down the
business. That is why the references were expressed to say whether the proposed closure of the business was proper and justified. In other
words, by the references, the Tribunals were not called upon by the Government to adjudicate upon the question as to whether there was in
fact a closure of business or whether under the pretence of closing the business the workers were locked out by the management. The
references being limited to the narrow question as to whether the closure was proper and justified, the Tribunals by the very terms of the
references, had no jurisdiction to go behind the fact of closure and inquire into the question whether the business was in fact closed down
by the management.â€
In the matter of Delhi Cloth and General Mills Co. Ltd. v. The Workmen and Ors., AIR 1967 SC 469, while dealing with Section 10(4) of the
Industrial Disputes Act, 1947 (in short, called “the ID Actâ€), the Supreme Court held as under:
“10. Proceeding in the order in which the arguments were addressed, we propose to deal with issues 3 and 4 first. Under s. 10(1) (d) of
the Act, it is open to the appropriate Government when it is of opinion that any industrial dispute exists to make an order in writing
referring ""the dispute or any matter appearing to be connected with, or relevant to, the dispute....... to a Tribunal for adjudication."" Under
s. 10(4) ""where in an order referring an industrial dispute to a Labour Court, Tribunal or National Tribunal under this section or in a
subsequent order, the appropriate Government has specified the points of dispute for adjudication, the Labour Court or the Tribunal or the
National Tribunal, as the case may be, shall confine its adjudication to those points and matters incidental thereto.
From the above it therefore appears that while it is open to the appropriate Government to refer the dispute or any matter appearing to
be connected therewith for adjudication, the Tribunal must confine its adjudication to the points of dispute referred and matters incidental
thereto. In other words, the Tribunal is not free to enlarge the scope of the dispute referred to it but must confine its attention to the points
specifically mentioned and anything which is incidental thereto. The word 'incidental' means according to Webster's New World Dictionary:
happening or likely to happen as a result of or in connection with something more important; being an incident; casual; hence, secondary
or minor, but usually associated:
""Something incidental to a dispute"" must therefore mean something happening as a result of or; in connection with the dispute or
associated with the dispute. The dispute is the fundamental thing while something incidental thereto is an adjunct to it. Something incidental,
therefore, cannot cut at the root of the main thing to which it is an adjunct. In the light of the above, it would appear that the third issue was
framed on the basis that there was a strike and there was a lock-out 'and it was for the Industrial Tribunal to examine the facts and
circumstances leading to the strike and the lockout and to come to a decision as to whether one or the other or both were justified. On the
issue as framed it would not be open to the workmen to question the existence of the strike, or, to the Management to deny the declaration
of a lock-out. The parties were to be allowed to lead evidence to show that the strike was not justified or that the lock-out was improper.
The third issue has also a sub-issue, namely, if the lock-out was not legal, whether the workmen were entitled to wages for the period of the
lock-out. Similarly, the fourth issue proceeds on the basis that there was a sit-down-strike in the Swatantra Bharat Mills on 23-2-1966 and
the question referred was as to the propriety or legality of the same. It was not for any of the Unions to contend on the issues as framed that
there was no sit-down strike. On their success on the plea of justification of the sit-down strike depended their claim to wages for the period
of the strike.
.....
So far as the fourth proposition is concerned, Mr. Chari argued that the Tribunal had to examine the pleadings of the parties to see
whether there was a strike at all. In our opinion, the Tribunal must, in any event, look to the pleadings of the parties to find out the exact
nature of the dispute, because in most cases the order of reference is so cryptic that it is impossible to cull out therefrom the various points
about which the parties were at variance leading to the trouble. In this case, the order of reference was based on the report of the
Conciliation Officer and it was certainly open to the Management to show that the dispute which had been referred was not an industrial
dispute at all so as to attract jurisdiction under the Industrial Disputes Act. But the parties cannot be allowed to go a stage further and
contend that the foundation of the dispute mentioned in the order of reference was non-existent and that the true dispute was something
else. Under s. 10(4) of the Act it is not competent to the Tribunal to entertain such a question.â€
Taking into consideration the scope of Section 10(4) of the ID Act and the construction thereof, the Supreme Court, way back in 1962, in the
matter of Express Newspapers Ltd. v. Their Workers and Staff & Ors., 1962 SC (1) LLJ 227, held as under:
“It is hardly necessary to emphasise that since the jurisdiction of the Industrial Tribunal in dealing with industrial disputes referred to it
under S.10 is limited by S.10 (4) to the points specifically mentioned in the reference and matters incidental thereto, the appropriate
Government should frame the relevant orders of reference carefully and the questions which are intended to be tried by the Industrial
Tribunal should be so worded as to leave no scope for ambiguity or controversy. An order of reference hastily drawn or drawn in a casual
manner often gives rise to unnecessary disputes and thereby prolongs the life of industrial adjudication which must always be avoided.â€
An examination of Section 10(4) of the ID Act clearly shows that the Labour Court/Industrial Tribunal is required to confine its adjudication to the
points of disputes referred and the matter incidental thereto.
It is not in dispute that the Industrial Tribunal do derive its jurisdiction from the Reference made by the State Government while being bound to act
within the four corners thereof and it could not and cannot enlarge the scope of the Reference nor can/could deviate therefrom. A demand which was
not raised at the time of raising the dispute could not have gone into by the Industrial Tribunal being not the subject matter thereof. The Reference in
this matter was quite specific in the following terms:-
“Whether workmen who have reached the maximum of their pay-scales are entitled to stagnation increment each year upto a maximum of
three increments as per memo of settlement dtd. 3.11.2000 and if so, what directions are necessary in this respect?â€
In Mahendra L. Jain & Ors. v. Indore Development Authority & Ors., (2005) 1 SCC 639, the Supreme Court has held as under:
“34. We have noticed the provisions of the Act and the Rules. No case was made out by the Appellants herein in their statements of claim
that they became permanent employees in terms thereof. There is also nothing on records to show that such a claim was put forward even in
the demand raising the industrial dispute. Presumably, the Appellants were aware of the statutory limitations in this behalf. Furthermore, the
Labour Court having derived its jurisdiction from the reference made by the State Government, it was bound to act within the four-corners
thereof. It could not enlarge the scope of the reference nor could deviate therefrom. A demand which was not raised at the time of raising
the dispute could not have been gone into by the Labour Court being not the subject-matter thereof.â€
The Reference clearly demonstrates in its terms that the first question is whether the workmen who have reached the maximum of their pay-
scales are entitled to stagnation increment each year upto a maximum of three increments as per the Memorandum of Settlement and secondly, if so,
what directions are necessary in this respect.
The aforesaid Reference clearly lays down in its terms that in case the workmen are entitled to stagnation increment each year, then only in that
eventuality, the words “if so†indicate, what directions would be necessary in that respect. The Reference does not in any manner lays down or
asks for what directions, if it is not so held, may be given or are necessary. The word “if so†is in continuity and in conjunction with the first part
in terms of the Reference and cannot be read in isolation or separately; rather it has to be read as such, in continuity and conjointly. Accordingly, this
Court is not convinced with the findings of the Industrial Tribunal to the extent, as argued by the learned counsel for the respondent that the stagnation
increment is required to be given in alternate years, i.e. once in every two years, and on the basis thereof, holding that the Management is required to
be directed to give three stagnation increments to the workmen alternatively within six years, as these findings are incidental to the first part of the
Reference. It is always open to the appropriate Government to refer the dispute or any matter appearing to be connected therewith for adjudication,
however, the Tribunal must confine its adjudication to the points of dispute referred and matters incidental thereto. In other words, the Tribunal is not
free to enlarge the scope of the dispute referred to it but must confine its attention to the points specifically mentioned and anything which is incidental
thereto.
The case of the workmen is that they be given stagnation increment every year and the same demand and dispute were raised by them. The
Government on the basis thereof made the Reference and referred the dispute for adjudication. The Reference having been
limited to the narrow question as to whether the workmen who have reached the maximum of their pay-scales are entitled toÂ
stagnation increment each year upto a maximum of three increments as per the Memorandum of Settlement and if so, what directions are
necessary in this respect, the Tribunal by the very terms of the Reference, had no jurisdiction to go further and enlarge the Reference by holding that
the Management was required to be directed to give three stagnation increments to the workmen alternatively within six years.
In State Bank of Bikaner & Jaipur v. Om Prakash Sharma, (2006) 5 SCC 123, the Supreme Court has held as under:
“12. In the instant case, the Award of the Labour Court suffers from an illegality, which appears on the face of the record. The
jurisdiction of the Labour Court emanated from the order of the reference. It could not have passed an order going beyond the terms of the
reference. While passing the Award, if the Labour Court exceeds its jurisdiction, the Award must be held to be suffering from a
jurisdictional error. It was capable of being corrected by the High Court in exercise of its power of judicial review. The High Court,
therefore, clearly fell in error in refusing to exercise its jurisdiction. The Award and the judgment of the High Court, therefore, cannot be
sustained. Consequently, the appeal is allowed and the judgment of the High Court is set aside. The award is set aside to the extent of order
of reinstatement with back wages. The writ petition filed by the appellant in the High Court is, thus, allowed.â€
This Court in M/s. Delhi Press v. K.S. Sidhu, 1979 (38) FLR 415, held that:
“...the interference by High Court can be on grounds of defects of jurisdiction, violation of the principles of natural justice or any error
of law apparent on the face of the record. .....The High Court will interfere only if the finding is based on no evidence or is such that it
could not have been arrived at on the basis of the material before it.â€
In the case titled as Syed Yakoob v. K.S. Radha Krishan, AIR 1964 SC 477, the Supreme Court has held as under:
“.......writ of certiorari can be issued for correcting errors of jurisdiction committed by inferior courts or tribunals; these are cases where
orders are passed by inferior courts or tribunals without jurisdiction, or in excess of it, or as a result of failure to exercise jurisdictions. A
writ can similarly be issued where in exercise of jurisdiction conferred on it, the Court or Tribunal acts illegally or improperly, as for
instance, it decides a question without giving an opportunity to be heard to the party affected by the order, or where the procedure adopted
in dealing with the dispute is opposed to principles of natural justice. There is, however, no doubt that the jurisdiction to issue a writ of
certiorari is a supervisory jurisdiction and the Court exercising it is not entitled to act as an appellate Court. This limitation necessarily
means that findings of fact reached by the inferior Court or Tribunal as a result of the appreciation of evidence cannot be reopened or
questioned in writ proceedings. An error of law which is apparent on the face of the record can be corrected by a writ, but not an error of
fact, however grave it may appear to be. In regard to a finding of fact recorded by the Tribunal, a writ of certiorari can be issued if it is
shown that in recording the said finding, the. Tribunal had erroneously refused to admit admissible and material evidence, or had
erroneously admitted inadmissible evidence which has influenced the impugned finding. Similarly, if a finding of fact is based on no
evidence, that would be regarded as an error of law which can be corrected by a writ of certiorari. In dealing with this category of cases,
however, we must always bear in mind that a finding of fact recorded by the Tribunal cannot be challenged in proceedings for a writ of
certiorari on the ground that the relevant and material evidence adduced before the Tribunal was' insufficient or inadequate to sustain the
impugned finding. The adequacy or sufficiency of evidence led on a point and the inference of fact to be drawn from the said finding are
within the exclusive jurisdiction of the Tribunal, and the said points cannot be agitated before a writ court. It is within these limits that the
jurisdiction conferred on the High Courts under Art. 226 to issue a writ of certiorari can be legitimately exercised (vide Hari Vishnu
Kamath v. Syed Ahmed Ishaque.....â€
The Tribunal, in this case, has decided correctly so far as first part of the Reference is concerned that the workmen are not entitled to stagnation
increment each year. To this extent, there is no dispute. However, the Tribunal has gone further and stated that the Management is required to be
directed to give three stagnation increments to the workmen alternatively within six years. No such dispute has been referred to the Tribunal. In other
words, the Tribunal has been called upon to just answer whether workmen who have reached the maximum of their pay-scales are entitled to
stagnation increment each year upto a maximum of three increments and if so, what directions are necessary in this respect? The direction of the
Tribunal as contained in the later part that the Management is required to be directed to give three stagnation increments to the workmen alternatively
within six years, cannot be termed as incidental, hence, the same is beyond the scope of Reference and must be struck down.
The Tribunal, in my opinion, has committed an error while answering the Reference holding that the Management is required to be directed to give
three stagnation increments to the workmen alternatively within six years, as is also evident from the submissions made by the learned counsels for the
parties that it is/was not stated anywhere in the pleadings or the written submissions or the arguments of the Management/Petitioner that the case of
the Management is that the stagnation increment is given in alternate years, i.e., once in two years, as stated in the Impugned Award dated
07.03.2005.
Consequently, the Rule is made absolute and the writ petition filed by the petitioner is allowed. The Award dated 07.03.2005 is quashed and set-
aside to the extent of holding that the Management is required to be directed to give three stagnation increments to the workmen alternatively within
six years, i.e. once in every two years. The parties shall bear their own costs.