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Judgment
Ramachandra Iyer, J.—This is a petition under Article 226 of the Constitution to issue a writ of certiorari calling for the records in I. D. No.
23 of 1958, on the file of the Industrial Tribunal, Madras, and quashing the order therein dated 12-6-1958. In March 1954 the petitioner, which is
a firm of partners carrying on business in the name of Express Beedi Factory, Gudiyattam, in the North Arcot District, established a beedi factory
at Gudiyattam for the manufacture and sale of beedies.
The management employed about 55 workers. The system adopted was to distribute beedi leaves to the workers who subsequently rolled
beedies. The workers were paid on the piece work basis. In the beginning of the year 1955, disputes arose between the management and the
workers in regard to quality and quantity of the beedi leaves distributed. But those disputes were settled. The settlement did not, however, achieve
its object.
It was harbinger of fresh demands and disputes, and the matter came to head on 26th March 1958, when the management declined to meet the
demand for Ramzan advance sponsored by the workers Union. The workers, who had entered into the factory, staged a stay in strike, and refused
either to work or quit the factory premises. Matters appear to have assumed a more serious turn on the following day. The partners of the
petitioner-firm, who were living close by the factory, had to leave their houses with their families.
Having regard to the deteriorating condition of the relationship between the workers and the management, the latter decided to close the factory.
On that date, the management put up notice to the effect that, because of the hostile and intransigent attitude taken by the workers, the
management was forced to close down the factory. It is admitted that, since then, the factory has remained closed in the sense that no industrial
process was carried on there.
The workmen, who were in occupation of the factory since 26th March 1958 did not leave it till 38th April 1958. The goods in the factory had to
be removed by the management with the aid of police. On 18th April 1958, a settlement appears to have been arrived at between the parties
whereby, it was agreed that each worker was to be paid a sum of Rs. 22-8-0 as compensation, and that the workers on their part should call off
the stay in strike and vacate the factory.
In the meanwhile on 1st April 1958 the Labour Officer made a report to the Government about the demands made by the workers. By G. O. Ms.
No. 1605 dated 28th April 1958, the Government being of opinion that an industrial dispute had arisen between the workers and the management
of the Express Beedi factory, Guliyattam, referred the following questions for adjudication by the Industrial Tribunal, Madras :
Whether the refusal of the management to give leave to the workers from 26-3-1958 is justified and to what relief they are entitled;
Whether the deduction of wages from 16-2-1958 for shortage of beedies due to damaged and short leaves, is justified and to what relief the
workers are entitled.
Whether the non-employment of L. Wahab Khan and T. Arumugham from 15-12-1957 is justified and to what relief they are entitled.
Computation of relief, if any awarded, in terms of money whether it can be so computed.
It will be clear from the terms of the questions stated above, that the reference was made on the basis that there was no closure but that there
were disputes in a factory which was then running. No question was raised as to whether there was closure and whether such closure was bona
fide or mala fide; whether the workers were entitled to closure compensation u/s 25FFF of the Industrial Disputes Act.
The parties, in due course, filed their claim statements. It is evident, that when the matter was taken by the Tribunal, the management contended
that there was closure of the business on 27-3-1958, that such closure was bona fide and the workers would not be entitled to any relief on the
questions referred which assumed that the factory was being run. On behalf of the workers, it was contended that the closure was illegal, and that
the management should be compelled to reopen the factory and give employment to the workers. Neither party, however, appears to have realised
that the questions referred for adjudication did not compromise any relief on the basis of closure.
It may be that, for the purpose of computation of relief under questions 1 to 3, the factum of closure and the date thereof might be relevant, but that
would only be incidental to the adjudication. The Industrial Tribunal, presumably at the invitation of the parties, proceeded to find first whether
there was a bona fide closure and then what the relief, to which the workers would be entitled to on that basis. This will be clear from the
observations of the Tribunal in the award, which is to the following effect:
The prayer by the Union on behalf of the workers is that the closure is illegal and that the management should be directed to reopen the factory
and give employment to the workers and also pay them back wages for the period of the illegal lock out. On the other hand, the contention of the
management is that the closure is not a mere lock out but was discontinuance of the business without any intention of reopening the factory and that
the management have got every right to stop their, business and that at the most the workers will be entitled only to compensation for closure u/s
25FFF. On these contentions, the question will have to be decided whether the closure of the factory by the management was a mere lock out or
closure in the sense of discontinuance of the business. But it has become unnecessary to investigate into that question, because on the terms of the
agreement, Ex. W. 2, set out above, it is apparent that both the parties treated the closure of I the factory as a settled fact and accordingly the
workers accepted, as their only remedy, retrenchment compensation, and towards such retrenchment compensation every worker received
payment of Rs. 22-8-0 to be set off, against such compensation when it is determined. On the terms of that agreement, there can be no doubt that
according to the intendment of both the parties the closure was a discontinuance of the business itself and not a mere lock out. The remedy of the
workers is only compensation and nothing more.
Having come to the conclusion set out above the Tribunal assessed the compensation payable by applying Section 25FFF of the Industrial
Disputes Act. On the third question referred the Tribunal held that the two workers did not turn up for work, one of them having sought
employment elsewhere and the other turning up for work sometime later, and that both of them, like others, would be entitled to retrenchment
compensation. The management seeks to challenge the propriety of the award in these proceedings.
It is clear from the award that the Tribunal has not answered questions 1 and 2 referred to it. These questions, as stated already, proceeded on
the footing that the factory was a going concern. There can be no doubt that the factory was going concern till the date of closure, namely, 27th
March 1958. Whether the workers would be entitled to any compensation if questions 1 and 2 were answered in their favour, is a matter for the
Tribunal to decide.
The finding of the Tribunal, that the factory was closed on 27th March 1958, is not now challenged before me. Even accepting that finding, the
workers might perhaps be entitled to some compensation, if questions 1 and 2 were answered in their favour by the Tribunal. It is, therefore,
necessary that, before there could be a proper disposal of the reference, questions 1 and 2 should be answered.
The more substantial point argued before, me is the jurisdiction of the Industrial Tribunal to award closure compensation under the provisions of
Section 25FFF. It is needless to point out that the reference u/s 10(1)(d) does not cover this question. The Industrial Tribunal is a creature of the
statute, and its jurisdiction would be limited to the matters referred to it u/s 10. Section 10(4) of the Act states:
Where in an order referring an industrial dispute to a Tribunal under this section or in any subsequent order, the appropriate Government has
specified the points of dispute for adjudication, the Tribunal shall confine its adjudication to those points and matters incidental thereto"".
The jurisdiction of the Tribunal being limited to the matters referred to it by the Government, it would have no right to travel outside the reference,
and proceed to adjudicate matters not referred to it. The question whether the workers would be entitled to closure compensation u/s 25FFF is
independent of the questions actually referred to the Tribunal. The right to compensation u/s 25FFF depends on closure, while questions 1 and 2
referred to proceed on the footing that there is no closure.
It is true that the question of closure would have an incidental bearing for working out of the monetary compensation, in case questions 1 and 2
were answered in favour of the workers. But that would not entitle the workers to obtain compensation for closure on the basis as if the question,
relating to it had been referred for adjudication by the Tribunal. That this was done at the invitation of the parties, would make no difference to the
competence of the Tribunal to adjudicate that question.
It is not as if that the Tribunal made a departure with the consent of the parties on a mere matter of procedure relating to the adjudication of the
dispute. It that were so, it might be that a party, having agreed to the departure from the prescribed procedure, could not complain against it. But
what was sought to be done in the present case is to invite the Tribunal to adjudicate on a point over which it has no jurisdiction for the reason that
the question has not been referred to it.
No amount of consent can give jurisdiction where there is none; nor can it be said that the Tribunal is in a position of an arbitrator. The jurisdiction
being by virtue of the statute and limited by the terms of the reference under the section, it would not be open to the workers and management to
confer jurisdiction upon the Tribunal on a question not covered by the reference. It would follow that the award of the Tribunal, in so far as it
entitled the workmen to closure compensation u/s 25FFF is invalid, and has to be quashed.
The next question relates to the non-employment of Wahab Khan and T. Arumugham from 15th February 1951 The Tribunal itself has held that
Wahab Khan had sought employment elsewhere. So far as he is concerned, no relief could be given. Arumughani also did not turn up for work.
Whether his turning up for work on 18th February 1958 will entitle him to any relief under question 3, is a matter to be considered by the Tribunal.
But the order of the Tribunal directing payment of closure compensation to the two workers cannot be sustained.
The result is that the award dated 12th June 1958 will be quashed. The question, whether, in view of the admitted closure; the workers will be
entitled to any relief on the basis of adjudication of questions 1 and 2, is a preliminary matter that will have to be considered by the Tribunal. If the
answer to the questions is in the affirmative, the Tribunal will have to Consider the actual questions referred, i. e., those covered by issues 1 and 2.
Rule nisi is made absolute. There will be no order as to costs.