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PETITIONER: WORKMEN OF SHRI RANGAVILAS     MOTORS (P) LTD.& ANR.

       Vs.

RESPONDENT: SHRI RANGAVILAS MOTORS (P) LTD.  AND ORS.

DATE OF JUDGMENT: 01/02/1967

BENCH: SIKRI, S.M. BENCH: SIKRI, S.M. HIDAYATULLAH, M. VAIDYIALINGAM, C.A.

CITATION:  1967 AIR 1040            1967 SCR  (2) 528

ACT: Industrial  Disputes Act (14 of 1947), s. 10(1) (c) and  (d) proviso  (1)  "Affected", if  means  "interested"--Order  of reference--Whether  should state why reference was  made  to Labour Court-"Appropriate Government," test for deciding.

HEADNOTE: The  second appellant was a workman in the workshop  of  the first respondent dent company any in its Bangalore branch in the  Mysore  State.   The  head,office  of  the  Company  at Krishnagiri,  in  the  Madras  State,  transferred  him   to Krishnagiri, contrary to the agreement that he would not  be transferred  .from Bangalore for ten years.  On the  workman raising  objections, the Company removed him  from  service. The  Krishnagiri Motor Workers’ Union, a majority  of  whose members  numbering more than one hundred were  employees  of the  Company,  took  up the  workman’s  grievance,  and  the Government of Mysore referred the industrial dispute to  the Labour  Court under s. 10(1) (c) of the Industrial  Disputes Act, 1947.  One of the questions referred was : whether  the order of transfer was illegal and if so" Whether the workman was entitled to "reinstatement in the Bangalore branch  with benefits  of  back  wages".  The Labour  Court  ordered  the reinstatement  of the workman in the Bangalore branch.   The Company challenged the award by a writ petition in the  High Court.   The  High  Court  while  holding  that  the  Mysore Government  was  the  appropriate  Government  to  make  the reference,  quashed the award on the grounds : (1) that  the legality of the removal of the workman was not the  -subject matter  of  reference,  and (2) that the  reference  to  the Labour  Court  could  not be justified  under  s.  10(1)(c), because the dispute fell within the Third and not the Second Schedule  to  the  Act; nor under the first  proviso  to  s. 10(1)(d),  because, the Government did not act  under  -that proviso,  and  because, more than one hundred  persons  were interested  in  and therefore likely to be affected  by  the dispute. In  appeal to this Court, the Company sought to support  the judgment  of  the  High Court also on the  ground  that  the Mysore  -Government  was not the appropriate  Government  to make the reference.

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HELD : (1) The legality of the termination of the service of the workman wag included in the order of reference. [532  D- E] The words "with benefit of back wages" coupled with the word "reinstatement"  are appropriate only to a case of  removal. On  the facts of the case, the transfer of the  workman  was illegal and so, his removal from service should be set aside and  be should be reinstated with benefits of  ’back  wages. [532 F-G] (2)  The  reference to the Labour Court was valid under  the first proviso to    s. 10(1) (d). [533 H] (a)  High  Court misinterpreted the proviso by equating  the two  ,words  interested and affected.  The  members  of  the Union  which  sponsored  the  cause  of  the  workman   were interested in the dispute, but they would not necessarily be affected by the dispute. [533 F-G]                             529 (b)  It is not necessary that the order of reference  should expressly state that it was because of the proviso that  the reference  was being made to the Labour Court.  If it  could be justified on the facts, there is nothing in the Act which makes such a reference invalid. [533 E-F] (3)  The  Mysore Government was the -appropriate  Government to  make the reference, because, the subject matter of  the, dispute  substantially arose within the jurisdiction of  the Mysore Government. [534 H] The  proper  question to raise is : where  did  the  dispute arise  and  not where was the dispute sponsored :  that  is, whether  there  is  a  nexus between  the  dispute  and  the territory  of the State making the reference. Ordinarily  if there is a separate establishment and the workman is working in  that  establishment,  the dispute would  arise  at  that place. [534 A-E] Indian Cable Co. Ltd. v. Its Workmen, [1962] Supp. 3  S.C.R. 589,followed.

JUDGMENT: CIVIL APPELLATE JURISDICTION: Civil Appeal No. 1065 of 1965. Appeal  by special leave from the judgment and  order  dated February 27, 1963 of the Mysore High Court in Writ  Petition No. 1096 of 1961. M.   K. Ramamurthi, for the appellants. O.   P.  Malhotra,  P.  C. Bhathari and O.  C.  Mathur,  for respondent No. 1. The Judgment of the Court was delivered by Sikri,  J. This appeal by special leave is directed  against the  judgment of the Mysore High Court in Writ Petition  No. 1096  of  1961  by which the High  Court  allowed  the  Writ Petition and quashed the impugned award dated June 30, 1961, made by the Labour Court, Bangalore, in Reference No. 51  of 1960.  In order to appreciate the points raised before us it is necessary to give the relevant facts. The  second appellant before us, R. Mahalingam, was  engaged as  a Foreman in the workshop of Sri Rangavilas  Motors  (P) Ltd.,  the first respondent, hereinafter referred to as  the Company,  in  the month of April, 1956.  By an  order  dated January 21, 1960, Mahalingam was transferred from  Bangalore to  Krishnagiri  where  the head office of  the  Company  is situated.   Mahalingam entered into correspondence with  the Company  alleging  that according to the conditions  of  his employment  he  could not be transferred from  Bangalore  to Krishnagiri.  Ultimately, the Company framed charges against

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Mahalingam  and removed him from service by an  order  dated April  7, 1960.  On April 8, 1960, Mahalingam complained  in writing  to  the Assistant Commissioner of  Labour  who  was functioning as the Conciliation Officer at Bangalore.  Later on,  one Selvaraj took part in the conciliation  proceedings on  the  authority of the resolution dated  July  21,  1960, passed at the General Body 530 meeting  of  Krishnagiri Motor Workers’ Union,  among  whose members  112  out  of 170 were  employees  of  the  Company. Selvaraj filed a statement of claims before the Conciliation Officer  on  September 1, 1960.  The  -Conciliation  Officer reported to the Government that the conciliation proceedings had failed, and thereupon the State Government by its  order dated  November  1,  1960, made in exercise  of  the  powers conferred  by  cl.  (c)  of  sub-s. (1)  of  s.  10  of  the Industrial  Disputes  Act, 1947  (XIV  of  1947)-hereinafter referred  to  as the Act-referred for  adjudication  by  the Labour Court, Bangalore, the following points in dispute :-               "  1. Whether the order of the  management  of               Sri   Rangavilas  Motor  (Private)  Ltd.,   in               transferring the workman Sri It.   Mahalingam,               Foreman, from their branch at Fort, Bangalore,               to Krishnagiri, is illegal or unjustified.  If               so,  is the workman entitled to  reinstatement               in  Bangalore  Branch with  benefits  of  back               wages or to any other relief ?               2.    Is Sri R. Mahalingam, Foreman,  entitled               to  arrears of increments and overtime  wages,               if so, what is the amount he is entitled to ? Selvaraj,  inter  alia, prayed in his statement  of  claims, filed on behalf of Mahalingam, as follows               "...it is prayed that the Hon’ble Court may be               pleased  to  direct  the  second  party   (the               Company)  to  cause the  payment  of  overtime               wages due, increments due (as mentioned in the               annexure  to  this  statement)  as  also   the               arrears of wages from 1-2-60 to 15-3-1960  and               order  payment of back wages with effect  from               the date of termination of service by  setting               aside  the  said order of termination  and  to               reinstate  the  workman  with  continuity   of               service." The  Company,  in reply, contended that  the  reference  was limited  only  to  the question of transfer,  and  hence  no question of reinstatement or back wages could be adjudicated upon.  Further, the Company contended that the reference was bad  because  it  did  not  fall  under  any  of  the  items enumerated in the Second Schedule to the -Act.  It was  also contended  that the dispute was an individual dispute.   One further  objection  was  raised  to  the  effect  that   the reference should have been made to the National Tribunal and not to the Labour Court The  Labour  Court overruled all  the  objections  regarding jurisdiction  raised  by  the Company  and  made  the  award holding  that both the transfer as well as the removal  from service of Mahalingam were illegal and that he Was  entitled to overtime wages as well as                             531 increments.   The  Labour Court made the  following  further direction: -                      "The  workman Sri Mahalingam should  be               reinstated in   ore  branch  with  full   back               wages  in continuity of the past  service  and               with same emoluments.  The second party  should

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             also  pay the arrears of Rs.  4629/27  towards               the   overtime  wages  and  as  well  as   the               increments due.Rs. 384". (sic.) As stated above, the Company filed writ petition challenging the award.  The High Court formulated the points which arose out of the arguments addressed before it thus:-               1.    Whether  the  dispute  referred  by  the               State  Government  to the Labour Court  is  an               industrial dispute ?               2.    If it is such a dispute-               (a)   Whether  the State Government of  Mysore               was not the appropriate Government to make the               reference ? and               (b)   Whether  the reference should have  been               made  by the Central Government to a  National               Tribunal               3.    Whether  any  dispute  relating  to  the               termination  of  the  service  of  the  fourth               respondent   is  included  in  the  order   of               reference ?                4.   Whether  the points of dispute  actually               referred  fall within the scope of  the  items               enumerated  in  the  second  Schedule  of  the               Industrial  Disputes  Act  and  are  therefore               within     the competence of the Labour  Court               ?                5.   Whether  on  the  question  of  transfer               there was any dispute     at      all      for               adjudication On the    first  point  the High Court,  agreeing  with  the Labour Court, held that on the facts what was originally  an individual  grievance of Mahalingam did assume at  the  time the reference was made by the Government the character of an industrial dispute. On  the first part of the second point, the High Court  held that  the  State Government of Mysore  was  the  appropriate Government  to  make the reference.  On the second  par’  it held  that  it was for the Central Government to  decide  to refer  or not to refer the dispute but the State  Government which  is  the  appropriate Government in  relation  to  the dispute does not lose its power of -making ’a reference. On the third point the High Court held that the question  of legality  or otherwise of the Company’s action  in  removing Mahalingam  from  service  was  not  the  subject-matter  of reference to the M2 Sup.  CI/67-5                             532 Labour Court and its award to the extent it dealt with  that topic was without jurisdiction. On  the  fourth point, the-High Court held  that  the  first proviso to cl.’(d) to s. 10 (1) of the Act did not apply and that  the dispute relating to increments and overtime  wages was  beyond the jurisdiction of the Labour ’Court and  could not have been validly referred to it.  It also held that the dispute  regarding transfer was included in  the  expression "rules  of  discipline" enumerated as item 8  of  the  Third Schedule,  and was therefore pot within the,  competence  of the Labour Court to adjudicate upon in view of these findings the Award was quashed.   Regarding point  No. 5 formulated by it, the High Court observed  that it was. unnecessary to examine that point, but as the matter had  been, argued at some length, the High Court stated  its opinion  thereon.   In its opinion, there was no  scope  far making  the  order  of transfer the  subject-matter  of  any dispute. The  same  points  that were formulated by  the  High  Court

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were-. argued before us.  Mr. Ramamurti, appearing on behalf of  the appellants, urged regarding point No. 3 that on  its true  interpretation the order of reference was quite  clear and  that  the  question  of  termination  of  services   of Mahalingam was included in the order of reference.  We  have already  reproduced  the  order of  reference  and,  in  our opinion, there is force in what Mr. Ramamurti urges It seems to  us that the order of reference is quite clear if  regard is: had to the words "reinstatement in Bangalore branch with benefits of back wages." If the words with benefits of  back wages"  considered,and with respect,the High Court  did  not consider them, the High Court’s conclusion might possibly be justified.   It seems to us that by the time  the  reference tame  to  be made everybody knew that  Mahalingam  had  been removed  from  service.  The words "with  benefits  of  back wages"   coup   led  with  the  word   "reinstatement"   are appropriate only to a case of  removal and not to a case  of transfer.  On the facts of this case  it is quite clear that the  contention  of  Mahalingam was that  the  transfer  was illegal  and  if the transfer as illegal, his  removal  from service  would fall automatically with the finding that  the transfer  was  illegal, and one of the  appropriate  reliefs that would be given would be reinstatement in the  Bangalore Branch  with  benefits  of back wales.  In our  view  it  is because of the above considerations that the word  "removal" was  not expressly mentioned.  In this connection  the  High Court relied on the provisions of s. 10(4) of the Act  which reads as under               "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                                    533               Tribunal,  as the case may be,  shall  confine               its  adjudication to those points and  matters               inidental thereto." We are unable to appreciate how this sub-section has any re- levance  to  the question of construction of  the  order  of reference made by the Government.  It is true that he points in  dispute must be specified, but the point with  which  we are  concerned is, whether as a matter of  construction  the point in dispute has been specified or not, and according to us the dispute regarding removal has been specified. Regarding  the  fourth point, with respect, the  High  Court misinterpreted  the  first proviso to cl. (d)  to  s."10(1). This proviso reads as follows               "Provided  that where the dispute  relates  to               any matter specified in the Third Schedule and               is not likely to affect more than one  hundred               workmen, the appropriate Government may, if it               so thinks fit, make the reference to a  Labour               Court under clause (c) The  High  Court  negative the, plea of  Mahalingam  on  two grounds: First that there is nothing either -in the order of reference.  or  in any, other material placed before  it  to indicate that the Government have applied their mind to  the applicability  of the proviso to the facts of this  case  or have  actually acted pursuant to the proviso in  making  the references to the Labour Court and secondly, that there  can be  no  doubt  that  more than one  hundred.  per  sons  are interested  in, and are therefore likely to be  affected  by the  dispute in question.  In our view it is  not  necessary

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that  the order of reference should expressly state that  it is because of the proviso that a reference is, being made to the  Labour Court, and if the reference can be justified  on the  facts, there is nothing in the Act which makes  such  a reference  invalid.   The second reason given  by  the  High Court,  with respect is erroneous because it seems  to  have equated,  the words "interested’ and ",affected".  It  would be  noticed that s. 10(1A) uses both the words  "interested" or  "affected".   Section  10(5) also uses  both  the  words "interested" or "affected".  It seems to us that there is  a difference  in  the import of the words  "  interested"  or, "affected".   The  Union  which sponsors  the  cause  of  an individual  workman  is interested in the  dispute  but  the workmen who are the members of the Union are not necessarily affected  by  the  dispute.  The dispute in  this  case  was regarding  the  validity  of  the  transfer  and  consequent removal of the appellant.  The other workmen would naturally be  interested in the dispute but they are not  affected  by this  dispute.   In  our opinion, the High  Court  erred  in holding that the first proviso to s. 10(1)(d) did not  apply to the facts of this case.  In view of our decision on  this point,  it is not necessary to go into the question  whether the  points in dispute fell within the second or  the  third Schedule to the Act. 534 Therefore,  the appeal must succeed unless the  Company  can satisfy  us that the points decided against it  should  have been  decided  in its favour.  This takes us  to  the  other points.   Mr. O. P. Malhotra strongly urges that  the  State Government  of Mysore was not the appropriate Government  to make  the  reference.  He .says that  although  the  dispute started at Bangalore, the resolution sponsoring this dispute was passed in Krishnagiri, and,, that- the proper test to be applied  in  the case of individual disputes  is  where  the dispute   has  been sponsored.  It seems to us that  on  the facts of this case  it  is clear that there was  a  separate establishment at ’Bangalore   and  Mahalingam  was   working there.  There were a number of other workmen working in this place.   The  order  of transfer, it is true,  was  made  in Krishnagiri at the head office, but the order was to operate on  a  workman working in Bangalore.  In our view  the  High Court was right in holding that the proper question to raise is : Where did the dispute arise ?  Ordinarily, if there  is a separate establishment and the workman is working in  that establishment,  the dispute would arise at that  place.   As the  High  Court  observed, there should  clearly  be  ’some -nexus  between the dispute and the territory of  the  State and  not necessarily between the territory of the State  and the industry concerning which the dispute arose.  This Court in-  Indian  Cable  Co.  Ltd.  v.  Its  Workmen(1)  held  as follows:                "The Act contained no provisions   bearing on               this  question, which must,  consequently,  be               decided   on  the  principles  governing   the               jurisdiction of Courts to entertain actions or               proceedings.  Dealing with a similar  question               under the provisions of the Bombay  Industrial               Relations  Act, 1946, Chagla, C. J.,  observed               in  Lalbhai  Tricumlal Mills Ltd. v.  Vin  and               Others [1956] 1 L.L.J. 557, 558               ’But What we are concerned with to decide  is:               where  did the dispute substantially  arise  ?               Now,  the Act does not deal with the cause  of               action, nor does it indicate what factors will               confer  jurisdiction  upon the  labour  court.

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             But   applying   the   well-known   tests   of               jurisdiction, a Court, or Tribunal would  have               jurisdiction  if  the  parties  reside  within               jurisdiction or if the -subject-matter of  the               dispute     substantially    arises     within               jurisdiction.’               In   our   opinion,   those   principles   are               applicable  for deciding which of  the  States               has jurisdiction to make a reference under  s.               10 of the Act". Applying  the above principles to the facts of this case  it is  quite. -clear that the subject-matter of the dispute  in this  case substantially -arose within the  jurisdiction  of the Mysore Government. (1)  [1962] Supp. 3 S.C.R. 589 : [1962] 1 L.L.J. 409. 535 Mr.  Malhotra  further urges that the High  Court  erred  in holding that it was an industrial dispute.  We see no  force in  this contention.  The High Court rightly  observed  that once the findings of fact recorded by the Labour; Court  are accepted, there is no doubt in law that in the circumstances of this case, what was originally an individual grievance of Mahalingam did assume, at the time the reference was made by the Government, the character of an industrial dispute. Mr. Malhotra urges that the finding of the Labour Court that  the  transfer  was illegal was perverse.   It  is  not necessary  to go into this question because once it is  held that   there  is  an  agreement  between  the  Company   and Mahalingam that he could not be transferred from  Bangalore, the  transfer would be bad.  The Labour Court  had  observed that one of the terms of agreement was that the Company  had agreed  not  to  transfer Mahalingam to  any  place  out  of Bangalore,  for  a  period of ten  years;  the  Company  had transferred Mahalingam from Bangalore to the head office  at Krishnagiri   and  this  action  of  the  Company   was   in contravention of the terms of the agreement. Then  Mr. Malhotra tried to urge the fifth point  formulated by  the  High Court.  This point was not  taken  before  the Labour Court and we did not allow him to raise this point.’ In  the result the appeal is allowed, judgment of  the  High Court set aside and the Award of the Labour Court  restored. The  appellant  will  have his costs here and  in  the  High Court. V.P.S. Appeal allowed 536