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CASE NO.: Appeal (civil)  766 of 2004

PETITIONER: SPIC Pharmaceuticals Division

RESPONDENT: Authority Under Sec. 48(1) of A.P. & Anr

DATE OF JUDGMENT: 28/02/2007

BENCH: Dr. ARIJIT PASAYAT & TARUN CHATTERJEE

JUDGMENT: J U D G M E N T With (Civil Appeal Nos. 768 of 2004, 767 of 2004 and 1498 of 2004))

Dr. ARIJIT PASAYAT, J.          

       Challenge in these appeals is to the legality of the  judgment rendered by a Division Bench of the Andhra Pradesh  High Court.  By the impugned judgment several writ appeals  and writ petitions, filed by the appellants, were dismissed.   The core question that arose for consideration in the cases  before the High Court was whether the provisions of  Sales  Promotion Employees (Conditions of Service) Act, 1976 (in  short the ’Act’) oust the jurisdiction of the authorities  constituted under the Andhra Pradesh Shops and   Establishment Act, 1988 (in short the ’Shops Act’) and  consequently the Authorities  under the  Shops Act are  excluded from entertaining appeals preferred by the aggrieved  sales promotion employees challenging the termination of their  services.  The further question was whether the Authorities  constituted under the Shops Act have no jurisdiction to  entertain any appeal preferred by the sales promotion  employees challenging action of the employees in terminating  their services.  Several writ petitions filed were dismissed by  learned Single Judge of the High Court and therefore, writ  appeals were filed.  The orders of the Authorities under the  Shops Act directing the reinstatement of the employees into  service together with back wages which  were challenged in  the writ petitions came to be dismissed by learned Single  Judge.  The appellant in each case is involved in the  manufacture of pharmaceutical products.  It has engaged the  services of employees for the purpose of marketing its  manufactured products.  In common parlance the employees  appointed by the pharmaceuticals companies are known as  medical representatives.  Charge sheets were issued against  the concerned employees and after holding inquiries, services  of the employees were terminated.  The employees invoked the  jurisdiction of the Labour Court challenging the orders of  termination but later on they withdrew them and moved the  authority under the Act along with, in some cases,  condonation for delay in approaching the Authorities  concerned.  Notwithstanding serious objections raised by the  employer, the concerned Authority condoned the delay.  Writ  Petitions filed and writ appeals preferred were rejected.   

In the present appeals the stand of the appellants was  that the authority under the Shops Act had no jurisdiction to

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entertain the so called appeals preferred by the employees as  the service conditions of the employer were governed and  regulated by the provisions of the Act which is a special  enactment.  The competent authority rejected the objections  raised by the employer.  As regards the jurisdiction it was held  that the cause of action arose within the territorial jurisdiction  of the concerned appellate authority could not be entertained.  Both the learned Single Judge and the Division Bench in the  writ appeal held that the appellate authorities’ orders were in  order.  It did not accept the stand that the forum created  under the Industrial Disputes Act, 1947 (in short the ’ID Act’)  was the only forum and the disputes cannot be raised in any  other forum.                    In support of the learned counsel appearing for the  appellant submitted that the Parliament enacted the Act as it  thought that it would be more appropriate to have a separate  legislation for governing service conditions of the Sales  Promotion Employees and accordingly made the provisions of  the ID Act applicable conferring rights on the Sales Promotion  Employees to challenge the orders of dismissal, discharge or  retrenchment in the forum created and constituted under the  provisions of the ID Act.  The Parliament specified application  of certain Acts to Sales Promotion Employees which include  Workmen’s Compensation Act, 1923, Minimum Wages Act,  1948, Maternity Benefit Act, 1961, Payment of Bonus Act,  1965 and Payment of Gratuity Act, 1972. Except these Acts no  other Act including the Shops Act shall be applicable.

       In response learned counsel for the respondent- employees submitted that two forums are available to the  employees i.e. under the provisions of ID Act and the Shops  Act.  It is for the employee to choose the remedy available to  him in law either by approaching the forums created i.e. one  constituted under the ID Act or the Authorities constituted  under the Shops Act.   

The High Court accepted that the Act which makes the  provisions of the ID Act applicable providing remedy to Sales  Promotion Employees is a special enactment dealing with  service conditions of sales promotion employees employed in  the establishment engaged in pharmaceutical industries.  The  Shops Act deals with specific rights created under that Act  and it has been indicated that these provisions provided for  some more measures for protecting interest of the employees.  They are beneficial  in nature.  The High Court held that the  jurisdiction conferred under the Shops Act cannot be said to  have been taken away in respect to enforcement of rights  conferred under the Act.  We think it is unnecessary to go into  these broader issues.  We find that the forums created under  the ID Act, on the facts of the case can more effectively deal  with the issues raised.  It is not to be understood that we have  said that the Appellate authorities under the Act do not have  jurisdiction.  We are not really deciding that issue as to  whether there was exclusion of the jurisdiction of authorities  made the Shops Act because it specifically provided that the  forum under the ID Act can be approached.  In the peculiar  circumstances, therefore, we direct that the concerned State  Governments i.e. Karnataka, Tamil Nadu and Maharashtra  shall make reference to the appropriate forum under the ID  Act within a month from today.  The concerned forum shall  make an effort to dispose of the reference to be made within  three months from the date of receipt of the reference.  If the  respondent employees are entitled to any payment because of  the pendency of the disputes, the same shall be paid within

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two months from today.  We make it clear that we have not  expressed any opinion on the merits of the case and the order  for reference by the State Government is being made in view of  the special features involved.  Normally it is for the State  Government to decide whether reference is to be made but in  view of the conceded position by the learned counsel for the  parties that the industrial disputes do exist, we direct the  concerned State Governments to refer the dispute to the forum  under the ID Act for adjudication as directed above.

       Appeals are accordingly disposed of with no orders as to  costs.