Ram Avtar vs Delhi Flour Mills Co. Ltd.

Hima Kohli, J.—The present writ petition has been filed by the petitioner praying inter alias for quashing of the impugned order dated

20.7.2005 passed by the Labour Court, whereunder it allowed an application filed by the respondent/management subject to payment of costs of

Rs.600/- to the petitioner, and directed that the issue No.1, pertaining to the question as to whether the petitioner was a ''workman'' or not, was to

be decided first with reference to other issues.

The dispute between the parties lies in a narrow compass. It is the case of the petitioner that his services were terminated by the

respondent/management on 30.9.1994 after conducting two enquiries against him. Claiming that the said termination was illegal and unjustified, the

petitioner raised an industrial dispute which was referred to the Labour Court. Based on the pleadings of the parties, the following issues were

framed by the Labour Court on 28.4.1998:

Whether employee/claimant is not a workman as alleged in preliminary objection of W.S.

Whether the reference is bad as alleged in preliminary objections 3,4 and 5 of the W.S.

Whether the two enquiries conducted by management were legal, justified and according to the principle of natural justice

Per terms of reference.

It was ordered that issue No.3 be treated as a preliminary issue, on which both parties led their evidence and, vide order dated 30.6.2003, the

Labour Court decided the preliminary issue against the respondent/management by holding that both the enquiries were vitiated on the ground that

the enquiries were not fair and proper and were not held in accordance with the principles of natural justice. However, the respondent/management

was allowed to prove the charges leveled against the petitioner and also to adduce evidence on other issues.

Thereafter, the respondent/management moved an application dated 10.12.2004 before the Labour Court for treating Issue no.1 as to whether

the petitioner was a ''workman'', as a preliminary issue. After hearing both the parties on the said application, by placing reliance on the judgment

of the Supreme Court in the case of Hussun Mithu Mhasvadkar v. Bombay Iron and Steel Labour Board reported as 2001 LLR (SC) 1083, the

Labour Court held that the plea raised by the management to the effect that the petitioner was not a ''workman'' within the meaning of Section 2(s)

of the Industrial Dispute Act, 1947 (hereinafter referred to as ''the Act''), related to the jurisdiction of the Labour Court in deciding the matter and

went to the root of the matter, and that if the said issue was decided against the petitioner and in favor of the respondent/management, then no

useful purpose would be served in adjudicating on the other issues. Accordingly, by the impugned order dated 20.7.2005, the application of the

respondent/management was allowed subject to costs of Rs.600/-.

Counsel for the petitioner stated that the Labour Court grievously erred in relying upon the two Judge Bench decision of the Supreme Court in

the case of Hussun Mithu Mhasvadkar (supra), for framing another preliminary issue as to whether the petitioner was a ''workman'' within the

meaning of Section 2(s) of the Act. It was submitted that the Labour Court not only misread the said judgment but also failed to consider the ratio

laid down by a three Judge Bench of the Supreme Court in an earlier case of D.P. Maheshwari v. Delhi Administration and Ors. reported as 1996

LLR 919. Counsel for the petitioner relied heavily on the observations made by the Supreme Court in the aforesaid case in support of his

contention that the Labour Court ought to decide all the issues in dispute at the same time, without trying some of them as preliminary issues, in

order to avoid delay and injustice. In this context, he also referred to the following judgments:

i. National Council for Cement and Building Materials Vs. State of Haryana and Others,

ii. Management of Dhenkanal Urban Cooperative Bank Ltd. v. Presiding Officer, Labour Court, Bhubaneshwar and Anr. 1998 Lab. I.C. 2577

It was urged that there was no conflict between the judgments in the cases of D.P. Maheshwari (supra) and Hussun Mithu Mhasvadkar (supra),

but even assuming that the subsequent two Judge Bench decision was inconsistent with the earlier three Judge Bench decision, the same would be

rendered per incuriam as the law declared by a larger bench in D.P. Maheshwari''s case was not considered at all in the latter two Judge Bench

decision.

Lastly, it was submitted that whether the petitioner was a ''workman'' or not was a mixed question of law and fact and that whenever such mixed

questions of facts and law arise, such issues cannot be dealt with as preliminary issues as it is necessary to adduce evidence for deciding such

issues. In support of his averment, counsel for the petitioner relied on the judgment rendered by the Supreme court in the case of Ramesh B. Desai

and Others Vs. Bipin Vadilal Mehta and Others, .

On merits, counsel for the petitioner emphasized on the fact that while issue No.3 regarding the validity of the enquiry was treated as a

preliminary issue at the request of the respondent/management, but at that time, the respondent/ management did not make a request for treating

issue No.1 regarding the status of the petitioner as a preliminary issue, and Therefore it was not appropriate for the Labour Court to have allowed

such a request made almost after 8 years from the date of reference.

Countering the arguments advanced on behalf of the petitioner, counsel for the respondent/management contended that the writ petition suffers

from delay as it has been filed nine months after the passing of the impugned order by the Labour Court, and during the said period and even

thereafter, no evidence was led by the petitioner on the preliminary issue despite the fact that the proceedings of the Labour Court have not been

stayed by this Court. It was stated that since the petitioner has not made out any grounds to show that the Labour Court had failed to exercise

jurisdiction or committed any error of law or violated the principles of natural justice while passing the impugned award, Therefore, there is no

reason for this Court to exercise its powers of judicial review in favor of the petitioner.

Counsel for the respondent/management supported the impugned order and stated that it is based on the law as enunciated by the Supreme

Court in various judgments that the issue of ''workman'' is a jurisdictional issue and goes to the root of the matter, and Therefore ought to be

decided at the preliminary stage itself. Reliance in this regard was placed on the following judgments:

i. Kirloskar Brothers Ltd. v. Its workmen 1962 (II) LLJ 782 SC

ii. Hira Sugar Employees Co-op. Consumers Stores Ltd., Belgaum Vs. P.P. Korvekar and Others,

iii. Hussun Mithu Mhasvadkar (supra)

As regards the argument raised on behalf of the petitioner that even if there is a conflict between the law laid down by the Supreme Court in

the cases of Hussun Mithu Mhasvadkar (supra) and D. P Maheshwari (supra), the judgment in Hussun Mithu Mhasvadkar (supra) which is later in

date would be per incuriam for the reason that an earlier judgment of D.P. Maheshwari''s case (supra) was not considered in it, counsel for the

respondent/management urged that it is impermissible for the High Court to overrule a decision of the Apex Court on the ground that the Supreme

Court laid down a legal position without considering any other point. Reference was made to the judgment in the case of Suganthi Suresh Kumar

Vs. Jagdeeshan, . In the alternative, it was submitted that since the law enunciated in the said cases is contrary, Therefore Hussun Mithu

Mhasvadkar''s case (supra) being later in date, would be deemed to have impliedly overruled the law laid down in D.P. Maheshwari''s case

(supra).

The only question that falls for consideration of this Court is as to whether the Labour Court ought to have allowed the application of the

respondent/management for treating the issue of the petitioner being a ''workman'' or not within the meaning of Section 2(s) of the Act by relying on

the judgment in the case of Hussun Mithu Mhasvadkar (supra).

In the case of Hussun Mithu Mhasvadkar (supra), the Labour Court had tried all the issues together by recording the evidence of the parties on

the same and then rejected the reference on the ground that the management therein was not an ''industry'' within the meaning of Section 2 of the

Act and since the ''workman'' therein was not employed in an ''industry'', he could not fall within the definition of ''workman''. In this context the

Supreme Court held that in a case of such a nature where the Labour Court and the High Court entertained doubts about the status of the

applicant therein as `workman'', instead of deciding the larger issue as to whether the respondent/management therein was an ''industry'' or not, the

Labour Court should have first decided the issue as to whether the petitioner therein was a ''workman'' or not, because had the said finding been

returned against the petitioner therein, then the matter could have rested there itself. Thus, the question as to whether the status of the claimant has

to be necessarily framed and decided as a preliminary issue, did not arise for consideration at all.

In the present case, however, the issue with regard to the legality and validity of the two enquiries has already been decided by the Labour

Court as a preliminary issue in the year 2003 and thereafter, the case was adjourned for recording the evidence of the respondent management to

prove the charges as also other remaining issues. After waiting for a period of almost one and a half years or so, the respondent/management

moved an application on 10th December, 2004 for treating the issue No.1, as to whether the petitioner was not a `workman'', as a preliminary

issue. The factual matrix of the case reveals that the petitioner was dismissed from service in the year 1994, aggrieved by which a dispute was

raised and referred to the Labour Court in the year 1996, on which the issues were framed in the year 1998 and a period of five years were spent

on deciding the issue No.3, which was treated as a preliminary issue.

In view of the aforesaid facts, the Labour Court ought to have rejected the subsequent application of the respondent/ management for treating

issue No.1 as a preliminary issue and proceeded to adjudicate on the entire dispute rather than treating issue No.1 as a preliminary issue. The

Labour Court ought to have posed to itself the question as to whether such threshold part adjudication by treating issue No.1 as a preliminary issue

was really necessary in the facts and circumstances of the case. It is not disputed by the respondent/management that though it had requested for

treating the issue of `workman'' as a preliminary issue in its written statement, but when the court decided to treat issue No.3 pertaining to the

enquiry as a preliminary issue, the respondent/management did not raise any objection, nor did it press its case for treating the issue of the

petitioner being a `workman'' or not under u/s 2(s) of the Act as a preliminary issue. After a lapse of about eight years, the application filed by the

respondent/management praying inter alias for treating issue No.1 as a preliminary issue can only be treated as an attempt on its part to drag the

matter by resorting to devices which would result in inordinate delay in deciding the industrial dispute, to the detriment of the petitioner and to its

own advantage.

It is in the aforesaid context that the judgment rendered by the Supreme Court in the case of D.P. Maheshwari (supra) assumes importance.

While bemoaning the unbecoming devices adopted by certain employers to avoid a decision in an industrial dispute on merits, the Supreme Court

took notice of the fact that various preliminary objections were raised by the employers inviting decisions thereon in the first instance and then

carried the matter in appeal to the High Court and Supreme Court, thus delaying a decision on the real dispute for years together. In this context,

the following observations made by the Supreme Court are relevant:

...There was a time when it was thought prudent and wise policy to decide preliminary issues first. But the time appears to have arrived for a

reversal of that policy. We think it is better that tribunals, particularly those entrusted with the task of adjudicating labour disputes where delay may

lead to misery and jeopardise industrial peace, should decide all issues in dispute at the same time without trying some of them as preliminary

issues. Nor should High Courts in the exercise of their jurisdiction under Article 226 of the Constitution stop proceedings before a Tribunal so that

a preliminary issue may be decided by them. Neither the jurisdiction of the High Court under Article 226 of the Constitution nor the jurisdiction of

this Court under Article 136 may be allowed to be exploited by those who can well afford to wait to the detriment of those who can ill afford to

wait by dragging the latter from Court to Court for adjudication of peripheral issues, avoiding decision on issues more vital to them. Article 226

and Article 136 are not meant to be used to break the resistance of workmen in this fashion. Tribunals and Courts who are requested to decide

preliminary questions must Therefore ask themselves whether such threshold part-adjudication is really necessary and whether it will not lead to

other woeful consequences. After all tribunals like Industrial Tribunals are constituted to decide expeditiously special kinds of disputes and their

jurisdiction to so decide is not to be stifled by all manner of preliminary objections journeying up and down....

The aforesaid observations of the Supreme Court were reiterated in the judgment rendered in the case of National Council for Cement and

Building Materials (supra) and while dealing with the issue about the management therein being an `industry'' within the meaning of the Act or not,

the Supreme Court observed as below:

We, however, cannot shut our eyes to the appalling situation created by such preliminary issues which take long years to settle as the decision

of the Tribunal on the preliminary issue is immediately challenged in one or the other forum including the High Court and proceedings in the

reference are stayed which continue to lie dormant till the matter relating to the preliminary issue is finally disposed of.

xxx

The facts in the instant case indicate that the appellant adopted the old tactics of raising a preliminary dispute so as to prolong the adjudication

of industrial dispute on merits. It raised the question whether its activities constituted an ''Industry'' within the meaning of the Industrial Disputes Act

and succeeded in getting a preliminary issue framed on that question. The Tribunal was wiser. It first passed an order that it would be heard as a

preliminary issue, but subsequently, by change of mind, and we think rightly, it decided to hear the issue along with other issues on merits at a later

stage of the proceedings. It was at this stage that the High Court was approached by the appellant with the grievance that the Industrial Tribunal,

having once decided to hear the matter as a preliminary issue, could not change its mind and decide to hear that issue along with other issues on

merits. The High Court rightly refused to intervene in the proceedings pending before the Industrial Tribunal at an interlocutory stage and dismissed

the petition filed under Article 226 of the Constitution. The decision of the High Court is fully in consonance with the law laid down by this Court in

its various decisions referred to above and we do not see any occasion to interfere with the order passed by the High Court. The appeal is

dismissed, but without any order as to costs.

In the case of Management of Dhenkanal Urban Cooperative Bank Ltd. (supra), while referring to the principles embodied in Order XIV Rule

2 of the Code of Civil Procedure, it was reiterated by the Supreme Court that there was a time when it was thought prudent to decide preliminary

issues first but as time passed, the said policy was reversed and it is now thought to be appropriate and desirable that all the issues should be tried

together to avoid inconvenience to the parties. The Court observed as below:

Para 5: ...Where a dispute exists on a factual aspect as to whether a particular person is a workman or not, it is not for the Tribunal or the Court to

determine that question as a preliminary issue. In the case at hand while the petitioner states that the opposite party No.2 employee was not a

workman, a dispute is raised as to the correctness of such stand by the said opposite party to be adjudicated on factual aspects. The objection

raised prima facie cannot be said to be of such nature as to be decided as a preliminary issue. That being the position, the Presiding officer, Labour

Court was justified in directing that all the issues are to be taken up together....

Thus, it cannot be said that there is any conflict between the judgments of the Supreme Court in the cases of D.P. Maheshwari (supra) and

Hussun Mithu Mhasvadkar (supra) as contended by the parties nor can it be said that the judgment rendered in the case of Hussun Mithu

Mhasvadkar (supra) would be per incuriam in the light of the law laid down by the Supreme Court in the case of D.P. Maheshwari (supra) for the

reason that the judgment in the case of Hussun Mithu Mhasvadkar (supra) was rendered in the peculiar facts and circumstances of the said case

wherein the Supreme Court was confronted with a case where the Labour Court was called upon to adjudicate both the issues, one relating to the

appellant therein being a `workman'' or not and the other relating to the respondent/management being an `industry'' or not, under the Act. In such

circumstances, it was observed by the Supreme Court that the limited issue of the appellant being a `workman'' or not, ought to have been

addressed by the Labour Court in the first instance, instead of deciding the larger issue of the respondent being an `industry'' or not, for the simple

reason that deciding the issue of the respondent/management being an `industry'' or not, had much larger ramifications. There is no such

predicament which was faced by the Labour Court in the present case, more so, when the issue No.3 with regard to the validity of the two

enquiries had already been treated as a preliminary issue and decided against the respondent/management. Further, the issue as to whether the

petitioner is a `workman'' or not cannot be said to be a pure question of law. The same is a mixed question of facts and law which would require

leading of evidence by the parties and in such a situation where mixed issues of law and facts need to be decided, then instead of trying the same as

a preliminary issue, the Labour Court ought to have proceeded to try all the issues and decide the industrial dispute itself.

In view of the aforesaid observations, the writ petition succeeds. The impugned order dated 20th July, 2005 passed by the Labour Court is set

aside. The Labour Court is directed to decide all the issues in the industrial dispute collectively without losing any further time. There shall be no

orders as to costs.