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CASE NO.: Appeal (civil)  5919 of 2005

PETITIONER: Air India Ltd. & Ors.                                    

RESPONDENT: Vishal Capoor & Ors.                                     

DATE OF JUDGMENT: 28/09/2005

BENCH: Ruma Pal,Dr. AR.Lakshmanan & C.K. Thakker

JUDGMENT: J U D G  M E N T (Arising out of SLP ( C ) No. 8258 of 2005) WITH C.A. Nos .5936 & 5920 of 2005  @SLP (C ) Nos. 20387 & 20309 of 2005 (CC 7543 & 7621/2005), C.A. No. 5921 & 5922 of 2005@SLP (C ) No.9306/2005 & SLP (C ) No.10505/2005)

RUMA PAL, J.         Leave granted.         These appeals arise out of a dispute over the seniority of co- pilots employed by the first appellant, Air India Ltd.  The contending  parties are two groups of co-pilots, namely, the respondents 1 to 6  (referred to hereafter as the ’writ petitioners") and the respondents 7  to 12. The bone of contention is whether seniority as a co-pilot is to  be calculated from the day a pilot gets an Air Lines Transport Pilot  Licence (ALTP) or from the day the pilot enters the service of the first  appellant with only a commercial pilot’s licence (CPL). The  differences between an ALTP and CPL as provided in Schedule II of   the Aircraft Rules 1937 are inter alia that an ALTP licence holder has  at least 1500 hours of flying of which 500 hours is as a pilot-in- command. A CPL holder has to have 250 flying hours with 150 hours  as a pilot-in-command. However apart from noting this, we do not  propose to decide this dispute as the issue which actually arises for  decision before us is much narrower. The question is whether the  High Court by the order impugned in this appeal should have decided  the contention itself or left it to the  Industrial Tribunal to decide.         The first appellant is owned by the Government of India and  provides international air transport services. Its aircrafts are operated  by pilots in command (PIC) and co-pilots or first officers apart from  other cock-pit crew.  Co pilots fly under the supervision of  commanders with 500 or more hours as PIC. It is common ground  that unless a pilot has an ALTP licence, he cannot qualify as a PIC.  According to the appellants, the respondents 7 to 12 were entitled to  seniority over the writ petitioners because they had obtained an ALTP  prior to the writ petitioners.  It is the appellants’ case that up till 1986  only ALTP holders were eligible for appointment as co-pilots with the  first appellant. CPL holders were recruited for the first time as  probationary co-pilots by the first appellant only from 1986.   Their  probation was to continue till they obtained the ALTP licence. If they  failed to get an ALTP it resulted in termination of their employment.           The Indian Pilots Guild (referred to as the Guild) was a  recognized union of pilots of the first appellant.  On 21st July 1989, a  settlement was arrived at between the Guild and the first appellant for  the period 1.10.85 to 31.8.90 (referred to hereafter as the 1989  Settlement).  Clause 3(d) of the settlement related to seniority and  read as under: "(d) The pilots joining the Corporation with

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ALTP will always have higher line seniority over  the co-pilots who is already in the employment  of the Corporation without ALTP Licence".

On 1st September 1990, the Guild gave a notice of termination  of the 1989 settlement and raised a fresh charter of demands.   In  1992 the CPL holders raised a demand before the appellants asking  for seniority from the date of their joining the first appellant.  The  demand was rejected.  They then filed a writ petition being W.P. No.  2365 of 1992 in which they challenged clause 3(d) of the 1989  settlement contending that the obtaining of an ALTP licence was  wholly irrelevant for confirmation as a co-pilot.  The writ petition was  opposed by the first appellant as well as by the Guild.  It was  ultimately dismissed on 11th February 1993 on the ground that the  letters of appointment of the CPL holders specifically provided for  their confirmation as a co-pilot subject to obtaining ALTP licence.   The Court was also of the view that it was a matter "falling in the  realm of a policy decision" of the first appellant and that there was  "nothing arbitrary about this clause".         On 20th January, 1995, however at a  meeting of the senior  officers of the first appellant, it was decided that CPL holders would  be on a training period for two years.  On completion of a training  period, they would be placed in the grade of co-pilot on  probation for  a period of one year.  On satisfactory completion of the  probation   period, they would be confirmed in the service of the first appellant  with  a rider that the services would be determined if they did not  complete their ALTP within five years from the date of their first solo  flight.  CPL holders who had already obtained their ALTP and had  been confirmed in service,  would be confirmed retrospectively i.e.  one year from their solo flight.    CPL holders who had completed  their first solo flight and had been released to fly as a co-pilot,  would  also stand confirmed only if they obtained the ALTP within five years  of their solo flight.  CPL holders who were on training and who had  not yet done their first solo, would be confirmed only in terms of the  decision taken.   The seniority of all CPL holders would be batch wise  and would be reckoned from the date of obtaining their ALTP.    The writ petitioners were appointed as trainee pilots after 1994  and were confirmed as co-pilots in September, 1996 with effect from  October 1996.  Their letters of confirmation required them to obtain  ALTP within a period of five years from that date failing which their  contract of employment would automatically end.         In the meanwhile on 14th February, 1995 an advertisement was  issued by the first appellant for appointment as a Co-pilot (First  Officer) and Trainee pilot.  The technical qualification required for   Co-Pilots inter alia was  possession  of an Indian ALTP with 1500  hours minimum flying experience which should include 500 hours as  Pilot in command experience either on multi engine aircraft or on  Turbo-jet aircraft.  The Trainee Pilots were required to be in  possession of inter alia an Indian CPL with an endorsement on a twin  engine type aircraft.   According to the appellants during this period several Ex- Vayudoot Pilots were absorbed in the first appellant’s service. ALTP  holders with 500 hours as pilots in command were given seniority  above co-pilots with CPL who were confirmed as co-pilots. However  they were placed below the officers holding ALTP  who were already  serving in the first appellant.  The rest which included pilots with  ALTP but without adequate command experience were placed below  the first appellant’s trainee pilots holding only CPLs.   There is some  dispute as to what actually transpired with regard to the absorption of  the Vayudoot pilots in 1995 in the service of the first appellant which  is unnecessary to be decided in view of what we have finally directed.   However it is admitted that the dispute of fixation of line  seniority of Co-pilots based on the holding of ALTP or CPL persisted.   The matter was referred to a Committee by the second appellant.   The Committee  gave its opinion in writing on 16th January, 1996 that

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the policy which was prevailing was "adequate and correct" in respect  of Pilots joining the first appellant with ALTP.  The policy for fixing of  seniority of pilots joining with CPL was also found to be "adequate."    The Committee finalised the seniority list which was then forwarded  to the Director of Operations and it was said that the basis for the  seniority list  which set out the reasoning of the Committee should be  explained to the new entrants before they joined so that  no  representation could be made later.       Pursuant to the advertisement for co-pilots issued by the  first appellant, respondents Nos. 7 to 12 and eight others who are  all ex-Indian Air Force or Navy Pilots and holders of ALTP licences  with 500  flying hours as pilots in command as advertised, applied  for appointments as co-pilots.  The 14 pilots (who will be hereafter  referred to as ’Adhikari group’) entered service as co-pilots in the  first appellant in November, 1996.  Their letters of appointment  contained a clause that they would be subsequently informed as to  their seniority.         The  Adhikari group filed a writ petition being W.P.(L) No. 1615  of 1997 seeking to enforce Clause 3(d) of the 1989 settlement.  The  writ petition was dismissed on 16th October, 1997. The Court held  that the 1989 settlement had already been terminated and was  "non- existing".  It was noted that negotiations were in progress between  the Guild and the first appellant and that if the petitioner pilots would  be aggrieved by any settlement which may be arrived they could  raise a dispute before the Conciliation Officer.  The High Court also  said that in case of failure of conciliation, the dispute could be  referred to the National Industrial Tribunal.  It was recorded that there  was a pending reference before the Tribunal and that it was "always  open to the petitioners to join in the said reference and raise their  demands".  The writ petition was therefore dismissed on the ground  that there was an efficacious alternate remedy.  The Adhikari group   sought to impugn the order of the High Court dated 16th October,  1997 before this Court by way of a special leave petition.         While the special leave petition was pending, on 3rd January,  1998, a settlement was arrived at between the Guild and the first  appellant (referred to as the "1998 settlement").  Several demands  relating to the conditions of service of pilots were decided  by the  settlement.  As far as seniority of the pilots were concerned, the  settlement noted earlier discussions held in 1995 and the following  terms  were recorded: 7. Seniority of Pilots. a) xxx  xxx             xxx             xxx b) xxx  xxx             xxx             xxx c)   Based on these discussions, the seniority  of trainee Pilots/Co-Pilots has been  determined as an one time exercise as  indicated in the Seniority List contained in  Annexure-D and this will not be cited as a  precedent in future.

d) Clause 3(d) of Schedule 2 of Memorandum  of Settlement dated July 21st 1989 stands  deleted.  Henceforth Line Seniority of Co- pilots joining the company will be based on  the date of entry of the pilot in the grade of a  first officer.  

       Annexure D referred to in Clause 7(C)was a seniority list  which placed the writ petitioners at   serial Nos. 173 to 178 and the Adhikari group against serial Nos.  205 to 218.           The Adhikari group withdrew their special leave petitions  challenging the order dated  16th October, 1997, stating that "since  the petition before  the High Court was premature, they wish  to  withdraw the present special leave petition so that they may take

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appropriate steps later".  They then filed a writ petition being W.P.  2930 of 1999 before the Bombay High Court challenging Clause  7(C)of the 1998 settlement.  The writ petition was dismissed on 14th  November, 2000.  Since the reasons for such dismissal was to a  large extent, the basis of the order impugned in these appeals, the  reasoning is noted in some detail.    In its order dated 14th November, 2000 the High Court noted  that the 1998 settlement was binding upon all workmen in view of  the express provisions of Section 18(3) of the Industrial Disputes  Act, 1947.   The court also noted the submission of the Adhikari  group that  the 1998 settlement could be challenged on the ground  that the same was unjust, unfair, not bona fide, and had been  arrived at on account of fraud, misrepresentation, concealment of  facts or as a result of corruption and other inducements.  The court  said that such a challenge could be the subject matter of yet  another industrial dispute but could not be the subject matter of  challenge before the High Court in its writ jurisdiction.  The  preliminary objection  raised by the first appellant and the Guild that  the issue had already been determined in WP(L) No. 1615 of 1997   in respect of which the special leave petition had been withdrawn,  was rejected because it was held that "the petitioners may be  justified in contending that a fresh cause of action had arisen".  The  Court then held: "The petitioners may challenge Clause 7(C)of  the settlement , if so advised, and if they are  entitled to do so, by raising an industrial  dispute.  The question as to whether the  settlement is just, fair and bonafide or that it is  vitiated by fraud, misrepresentation or  concealment of facts in the first instance, must  be examined by the Industrial Tribunal on a  reference being made to it by the State  Government. Of course, the award of the  Tribunal may be challenged in a proceeding  under Article 227 of the Constitution of India  on the grounds permissible in law".

However, the court refused to set aside clause 7(C)of the 1998  Settlement in exercise of its jurisdiction under Article 226 of the  Constitution since:-  

"it is not as if the settlement is so blatantly  arbitrary, unreasonable or irrational that the  same should be quashed by this Court without  any thing more".                Having come to the conclusion that the court would not  interfere with the settlement in exercise of its writ jurisdiction, the  Court also recorded that it was not inclined to examine the other  submissions made on behalf of the Adhikari group because "those  question may have to be  raised in an industrial dispute which may  be referred for adjudication by the Tribunal".                  It was also observed  that since the Adhikari group had   been told in their letters of appointment that the question of their  seniority would be decided later, they had not acquired any vested  right of seniority.   The Court said that:  "Having regard to the submissions urged  before us, we feel that these are matters which  may require deeper consideration, and it cannot  be said that the settlement, on the face of it, is  so arbitrary and unreasonable that it should be  quashed forthwith by this Court in exercise of  its writ jurisdiction".

A doubt was also expressed as to the claim of the Adhikari

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group in the following language:-

"The settlement is in the nature of a package  deal, and it is doubtful whether the petitioners  can claim the benefits under the settlement  including monetary benefits, and at the same  time, challenge only a particular clause of the  settlement".  

Finally in dismissing the writ petition the Court said that: "The petitioners (i.e. the Adhikari group) must  seek their remedy under the provisions of the  Industrial Disputes Act instead of invoking the  writ jurisdiction of this Court under Articles 226  and 227 of the Constitution of India".    

                The Adhikari group challenged the order of the High Court in a  special leave petition which however was withdrawn on 19th March,  2001.  The order of this Court records: "Learned counsel for the petitioners states  that the petitioner would be advised to  approach the Industrial Court  in accordance  with the judgment  of the High Court and  seeks to withdraw the petition.  We record the  statement of the learned counsel and dismiss  the special leave petition as withdrawn".  

The Adhikari group then filed a complaint before the National  Industrial Tribunal (referred to hereafter as "the Tribunal") in the  pending reference being Reference No. NTB -1 of 1990 under  Section 33-A of the Industrial Disputes Act, 1947. (referred to as the  1947 Act) The complaint was opposed both by the first appellant as  well as the Guild on the ground that the dispute relating to the  seniority of co-pilots was not connected with the dispute pending  before the Tribunal and therefore the complaint under Section 33-A  of the 1947 Act was not maintainable. The Adhikari group were  advised to  withdraw  their complaint under Section 33-A from the  Tribunal, which they did.         On 6th October, 2003 they raised a dispute relating to the  fixation of their seniority under the 1998 settlement under Section  12 of the 1947 Act before the Conciliation Officer.  The Conciliation  Officer recommended to the management of the first appellant that  considering the historical background of the question relating to  seniority, and since the Adhikari group had joined on 25th  November, 1996 prior to the 1998 settlement coming into operation,  they should be granted seniority as claimed by them.         In the meanwhile on 8th December, 2000 the period of five  years for CPL Pilots to obtain their ALTP licence was extended for a  period of a further six months.  The period of six months was again  extended on 27th June, 2002 upto seven years.  The requirement for  an ALTP licence for Co-Pilots was ultimately totally removed by 1st - 2nd August, 2002 when a decision was taken by the first appellant  that "in order to give a fair and reasonable chance to all co-pilots"   the requirement to obtain an ALTP licence within five years should  be removed altogether for all co-pilots.  All that was required was  that a co-pilot should be in possession of an ALTP licence by the  time he/she comes up for command training as per line seniority.         The Adhikari group made a representation to the management  of the first appellant on the basis of the recommendation of the  Conciliation Officer.  The General Manager (Human Resource  Development ) supported the representation by his letter dated 20th  April, 2004.  The Chairman and Managing Director of the first  appellant (who is the second appellant) appointed a four member  Committee to go into the issue.   The Committee submitted a

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lengthy report on 4th June 2004 in which they submitted that the  Adhikari group who had been appointed in November, 1996 should  be placed as far as the line seniority was concerned only below  those ALTP Holders who had already attained command or those  who were undergoing command training.          Despite the recommendation of the Committee, acting on the  basis of Annexure ’D’ to the 1998 settlement  read with the  instructions dated 1st-2nd August, 2003, letters for command training  were issued to the writ petitioners on  14th September, 2004 by the  third appellant viz the General Manager, Operations.  (Administration). However the second appellant, namely the  Chairman of Air India, acting on the basis of the Committee’s  Report, passed an order on 23/28th September, 2004 approving the  recommendations of the Committee.  According to him, the seniority  of the Adhikari group had been decided "improperly". In the  circumstances, the letters issued to the writ petitioners for command  training on 14th September, 2004 were cancelled by the third  appellant on 30th September, 2004, who then issued letters of  command training on 1st October, 2004, to the respondents 7 to 12.    In the circumstances, a writ petition  ( W.P. No. 3108 of  2004) was filed on 5th October, 2004 by the writ petitioners which  was allowed by the High Court on 10th March, 2005 by the order  impugned in these appeals.      In allowing the writ petition, the High Court accepted the  submissions of the writ petitioners. It rejected  preliminary objections  raised by the respondents 7-12 and the appellants that the  grievance of the writ petitioners as to the alleged non- implementation of the 1998 Settlement should be decided  appropriately under the Industrial Disputes Act 1947 and not under  Article 226, particularly, since  there were disputed questions of fact.   It was found that there was no factual controversy which justified the  Court in rejecting the writ petition on the ground of an alternative  remedy.  In the impugned order large passages of the earlier  decision in W.P. No.2930 of 1999 were quoted extensively after  which the learned judges came to the conclusion that the judgment  finally decided the issues between the parties and had not left them  open for adjudication all over again. The earlier decision had   reached finality and could not be reopened. It was held that the  respondents 7 to 12 were also barred from raising their grievances  by the withdrawal of the complaint under Section 33A of the 1947  Act.  The High Court also held that the seniority list appended to the  1998 Settlement had been acted upon and implemented. It was  held that the respondents 7 to 12 had the liberty to avail all legal  remedies and having abandoned them, it was not open to them to  urge that the settlement  which was in force and implemented from  1998 was vitiated by fraud and collusion. It held that the Court  would not examine allegations of fraud at the instance of the  respondents 7 to 12 as that would, in the High Courts’ opinion,  amount to entertaining "a totally distinct grievance based upon  independent cause of action".  Finally, the High Court found that the  appellants had not been able to justify their action of withdrawing  the letters issued to the writ petitioners as to their command  training.  As such, the letters cancelling the earlier letters directing  the writ petitioners to go for command training were  quashed. The appellants have contended that the seniority of the  Adhikari group was correctly fixed on the basis of the Conciliation  Officer’s recommendation and the Committee’s Report.  The 1998  settlement expressly stated that it would operate prospectively.  In  any event Clause 16 of the 1998 settlement provided for filing of the  settlement before the National Industrial Tribunal in the pending  reference and for obtaining of a consent award.  This had not been  done.  It was submitted by the appellants that the issue of seniority  should be left to the Industrial Tribunal to decide.  Till that was done,  it was suggested that as an interim measure, the Adhikari group  should be permitted to continue as commanders but that  line

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seniority according to Annexure D to the 1998 settlement could  continue subject to the condition that the writ petitioners and others  placed higher than the Adhikari group in that list would not claim any  compensation for the shortfall under Clause 4(a)(i) and (f)(iv) of the  1998 settlement.  The Adhikari group have separately challenged the impugned  order.  They have adopted the arguments of the  appellants.  They  also said that the settled practice of the first appellant was that all  co-pilots or First Officers had to have ALTPs.  CPL recruits were  recruited as trainee pilots only because of pressure from senior  officers of the first appellant whose children had obtained CPLs.   Nevertheless the ALTP always had higher line seniority over the co- pilots already in the first appellant’s employment who did not have  ALTP.  Therefore seniority was not on the date of entry into the  category of first officer/co-pilots but on the date of obtaining ALTP.   Clause 3(d) of the 1989 settlement provided this and although the  settlement was terminated in 1990 by the Guild, it continued to  remain in force till the new settlement came into effect.  This was  the law and in fact was given effect to by the first appellant in their  record note of 1995, in the appointment letters issued to the writ  petitioners,  when the Vayudoot pilots were absorbed, in the 1995  advertisement, and in various directions and letters of the first  appellant.  The High Court also upheld this by its order dated  11.2.1993 dismissing the CPL holders’ writ petition in which  affidavits had been filed by the first appellant and the Guild justifying  the higher line seniority of the ALTP holders.  Therefore at the time  when the Adhikari group were appointed as co-pilots, the prevailing  principle was Clause 3(d) of the 1989 settlement  and the 1998  settlement could not affect their seniority retrospectively.  They say  that Annexure D,  which was significantly a one time settlement,  was the outcome of nepotism by senior officers of the first appellant  and  the guild whose children or close relatives in the employment  of the first appellant and  holding CPL licences would benefit  thereunder.  Even the 1998 settlement  was not abided by in that  the condition for obtaining the ALTP in five years was done away  with.  The action of the appellants was arbitrary, malafide and unjust  and violative of Article 14.  It was further contended that the 1998  settlement should not therefore be given effect to. In any event the  Adhikari group had the right to raise an industrial dispute.  The High  Court had granted the Adhikari group such right.   Their complaint  under Section 33-A of the 1947 Act was an interim application and  its withdrawal did not prejudice their right to raise a dispute before  the Conciliation Officer under Section 12 of that Act.  Furthermore, it  was argued that the pending reference related to a dispute between  Indian Airlines and its employees and did not relate to any dispute  between Air India and its workmen as held by the Tribunal in its final  award.  It is submitted that this Court should hold that the 1998  settlement cannot take  away the Adhikari group’s  rights of seniority  but if the disputes were to be decided under the 1947 Act, this Court  should itself refer the dispute to the Tribunal.  In the meantime they  were willing to abide by the interim arrangement suggested by the  appellants.  The writ petitioners have said that the issue relating to  seniority of ALTP holders was barred by res judicata since the 1989  settlement had been found to be "non-existing" in WP (L) No 1615  of 1997.  The High Court in its subsequent decision dated  14.11.2000 had also decided the challenges raised against the  1998 settlement on merits. Additionally, the Adhikari group had  abandoned their claim before the Tribunal.  As far as the first  appellant was concerned, it had supported the 1998 settlement in all  the proceedings and could not be permitted to take a different  stand.  The fact that the 1998 settlement provided for filing of the  award before the Tribunal and the obtaining  of a consent award,  was irrelevant since Clause 16 did not make the operation of the  settlement conditional upon the obtaining of a consent award.  

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Besides the result would be the re-opening of all the terms and  conditions taken as settled and acted upon by the appellants and  the Adhikari group which had additionally received benefits  thereunder. It was stated that the 1998 settlement was a valid  statutory settlement under Section 18(3) of the 1947 Act.  According  to the writ petitioners existing Air India pilots as on November 1996  had already been validly confirmed as co-pilots even though they  were CPL holders before the Adhikari Group were recruited. It was  submitted that there were no malafides attached to the 1998  settlement and that the Adhikari group did not get any assurance  that they would supersede those already in service.   They claim  that it is accepted service jurisprudence that generally seniority of  batch recruits is based on the date of entry into service.  According  to them the 1989 settlement had not been applied to the Vayudoot  recruits and was not in force when the Adhikari group was recruited.   It is contended that the reference to a one time settlement in  Annexure D dealt with the place of Vayudoot pilots and not to the  seniority of the writ petitioners.  They say that the ALTP licence was  irrelevant to the fixation of seniority although it was relevant for the  purposes of promotion.   It was also contended that the Adhikari  group could not challenge the seniority list in Annexure ’D’ thereto  co-laterally  in proceedings filed by the writ petitioners. It was finally  submitted that this Court should not refer the dispute between the  parties to the Industrial Tribunal for adjudication especially   at the  instance of the respondents 7 to 12 on a writ petition filed by the writ  petitioners. Even if they were permitted to do so in a separate  proceeding, till there was a fresh adjudication, the 1998 settlement  would have to operate. In our opinion the High Court erred in rejecting the preliminary  objection of the respondents 7 to 12 viz. that the writ petitioners  should have been left to pursue their grievance relating to the  breach of Clause 7 (C) of the 1998 settlement before the  appropriate forum under the Industrial Disputes Act, 1947. There  was a serious factual controversy as was noted by the High Court  itself in paragraph 22 of its judgment. It had been contended by the  Adhikari group  that the 1998 Settlement was vitiated by fraud and  malafides on the part of the office bearers of the Guild and some  Officers of the first appellant.  The claim of  the Adhikari group  which has been reiterated before us is that senior officers of the  Guild and the first appellant fraudulently agreed to clause 7(C) of  the 1998 settlement so that their sons and daughters who were CPL  holders were given undue benefit in deviation from the established  requirements and practice of the first appellant.  Such allegations if  proved would be sufficient to set aside the 1998 Settlement in so far  as it affected seniority of the Adhikari group. There is a long line of  authority in support of this proposition (See for example  Herbertsons Ltd. V. The Workmen of Herbertsons Ltd. & Anr.  (1976) 4 SCC 736, 742; KCP Ltd. V. Presiding Officer (1996) 10  SCC 446 and National Engineering Industries Ltd. Vs. State of  Rajasthan (2000) 1 SCC 371,393). This was also the finding of the  High Court in W.P.No.2930 of 1999.    Sufficient particulars in  support of these allegations had been given.  The Conciliation  Officer, the Committee set up by the Chairman of Air India, and the  Chairman himself had founded that an injustice had been done to  the Adhikari group.  The opinions expressed have not been held  by  the High Court to be without substance.  Indeed the High Court did  not consider any of this because it was held, incorrectly as we have  held  later in our opinion, that the issues raised had been concluded  by the earlier decision of coordinate Benches in W.P.(L ) No.1615 of  1997 and WP (c ) No. 2930 of 1999.   A disputed question of fact will normally arise when a  petitioner puts forward a case on facts which are controverted by  the respondents.   This is naturally so, as it cannot be expected that  the petitioner will of his, her or its own say that the facts forming the  basis of the claim are disputed.  Although it may happen that the

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Court on a scrutiny of the nature of the claim made in the petition  may come to a conclusion that the factual issues raised are ex facie  controversial and decline, in limine, to exercise jurisdiction under  Art. 226, nevertheless the controversy usually surfaces after the  respondents have had an opportunity of giving their version of the  matter.  That was what happened in the present case.  The writ  petitioners rested their case on clause 7(C)read with Annexure D to  the 1998 settlement.  The respondents pleaded that the settlement  was vitiated by fraud.  Obviously, the burden of proving this would  be on the respondents. No court or tribunal has tested the  allegations made by the Adhikari group on merits till today. The  High Court shut out the allegations altogether for two reasons. The  first reason was that it would amount to entertaining a separate  cause of action.  The conclusion was erroneous  as it was based on  a confusion between onus of proof and cause of action.   In ABL International Ltd.  Vs. Export Credit Guarantee  Corpn. of India & Ors. (2004) 3 SCC 553, the dispute was limited to  an interpretation of the terms of a contract of insurance and an export  contract.  Counsel for the respondent  contended that for a correct  interpretation of the clauses of the contracts there was  need for oral  evidence being led without which a proper interpretation of the  clauses was not possible, and therefore, it was a fit case in which the  appellants  should be directed to approach the civil court to establish  their claim. This Court construed the clauses of the contracts and  said that there was no room for a second or other construction.  It  was noted (and as we would like to emphasise) that there was no  allegation that the contracts in question were obtained either by fraud  or by misrepresentation.  In such factual situation, this Court was of  the opinion that  the facts of the case did not and should not inhibit  the High Court or this Court from granting the relief sought for by  the  petitioner.   In other words, merely because the respondents want to  dispute a construction to be placed on a clause of a contract, it would  not become a disputed question of fact.  On the other hand, if there  are allegations of fraud, misrepresentation etc. it may be a disputed  question of fact and the High Court should not go into the same but  allow the parties to approach the alternative forum legally available.   The second reason given by the High Court (which has also  been the writ petitioners’ submission before us) was that all the  issues raised by the respondents 7 to 12 had been finally decided by  the earlier decisions dated 16th October, 1997 in WP (C)No.1645 of  1997 and 14th November, 2000 in W.P. No.2930 of 1999. Doubtless  the High Court in its order dated 16th October 1997 had opined that  the 1989 settlement was "non-existing". The observation was  manifestly erroneous in view of this Court’s expressed in Life  Insurance Corporation of India Vs. D.J. Bahadur & Ors.(1981) 1  SCC 315 to the following effect:- "Once the earlier contract is extinguished and  fresh conditions of service are created by the  award or the settlement, the inevitable  consequence is that even though the period of  operation and the span of binding force  expire, on the notice to terminate the contract  being given, the said contract continues to  govern the relations between the parties until  a new agreement by way of settlement or  statutory contract by the force of an award  takes its place". (pg348)

Although the view expressed in W.P (L)No.1615 of 1997 is  erroneous, nevertheless, the question whether the 1989 settlement  can found an enforceable right in the respondents 7 to 12 is  concluded against them. But the decision would not debar the  raising of a dispute that the 1998 settlement was vitiated by fraud,  corruption as the settlement was entered into after those  proceedings were concluded before the High Court.  Furthermore,

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although the decision precludes the Adhikari group from claiming a  right under the 1989 settlement, they can certainly rely upon it as  evidencing a continuation of an established practice and  requirement. It would also be open to the Adhikari group to rely on  all other factors in support of their claim for seniority over the CPL  holders. By the  decision in W.P. No.2930 of 1999, however, the High  Court had not held that one clause in the Settlement cannot be  challenged in isolation.  A doubt had merely been expressed but no  firm conclusion had been arrived. Nor had the Court decided the  merits of the Adhikari group’s grievance at all. What the High Court  had in fact decided was that the issues of fraud etc. raised could not  be decided in exercise of the Court’s jurisdiction under Article 226.   It expressly left the issues to be decided on a deeper consideration  by the Industrial Tribunal. This is abundantly clear  from the  passages from the judgment dated 14th November, 2000 quoted by  us. Another error in the decision impugned before us was the  refusal to allow the respondents 7 to 12 to raise their claim  regarding their seniority because they had withdrawn their complaint  under Section 33A of the Industrial Disputes Act 1947.  It is  nobody’s case that the complaint of the Adhikari group under  Section 33A was legally maintainable in Reference No. NTB 1 of  1990. In fact both the first appellant and the Guild had opposed the  complaint on this ground.  Section 33A allows a complaint to be filed  in a pending reference where an employer contravenes  the  provisions of Section 33 of the 1947 Act during the pendency of  proceedings pursuant to a reference under Section 10(1) of the  1947 Act.  The relevant portion in Section 33(1)(a) prohibits an  employer  from  altering, to the prejudice of the "workmen  concerned in such dispute", the conditions of service applicable to  them immediately before the commencement of the proceeding.   There was no pending proceeding relating to any dispute between  Air India and its workmen in which the Adhikari group could have  filed a complaint under Section 33A.  The dispute which was  pending before the Tribunal in Reference No. NTB-1 of 1990 did not  relate to a dispute between the first appellant and its workmen.  It  related to a dispute between  Indian Airlines and its workmen  basically on the question whether the latter were entitled to the  same terms and conditions of service as the employees of the first  appellant.  The award which has since been made on the reference  by the Tribunal also records:  "This reference cannot cover any industrial  dispute between Air India and its workmen as  the order of the Central Govt. is confined to  dispute between (Indian) Airlines and its  workmen".

In these circumstances the withdrawal of the complaint under  Section 33A did not debar the Adhikari group from raising a fresh  industrial dispute. That is what the Adhikari group has sought to do.   It approached the Conciliation Officer.  The claim is said to have  been investigated  by the Conciliation Officer, whose duty is to try  and affect a fair and amicable settlement of disputes,  under Section  12(2) of the 1947 Act. A recommendation was made by the  Conciliation Officer to the first appellant. Since the recommendation  for conciliation has been accepted by the management of the first  appellant, there was no question of the Conciliation Officer reporting  a failure of settlement under Section 12(4) to enable the appropriate  Government to make a reference to an Industrial Tribunal under  Section 12(5).  Whether by this process, clause 7(C)and Annexure  D to the 1998 settlement could be altered is again a question  requiring resolution by the appropriate forum under the 1947 Act.   When the High Court in the impugned judgment concluded  that Annexure D to the 1998 Settlement had been acted upon and

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implemented, it did not discuss any fact in support of this  conclusion. Besides, the High Court’s decision that there was "no  dispute that the writ petitioners are senior in the list and seniority  over and above respondents 4 to 9" was in the circumstances  narrated, factually wrong. But assuming the conclusion was correct,  nevertheless, having regard to the decisions of this Court earlier  noted,  it is still open for the Adhikari group to challenge the 1998  Settlement on the ground of lack of bonafides, arbitrariness, fraud  etc.   Such a challenge to the 1998 Settlement cannot ofcourse be  decided in a writ proceeding as has been already held by the High  Court W.P.2930 of 1999. According to the appellants and the Adhikari group, the 1998  Settlement cannot in any event be termed to be a final settlement  under Section 18(3) of the Industrial Disputes Act, 1947 because of  Clause (16) to the 1998 Settlement which provided:- 16. Both the parties agree that this settlement  will be filed before the Hon’ble National  Industrial Tribunal, in the pending reference  No.NTB-1 of 1990 and Consent Award will be  obtained accordingly."

Admittedly, the 1998 Settlement was not filed as envisaged  nor was a consent award obtained although this point was not  raised in WP 2930 of 1999. But the issue has been concluded  against the respondents 7 to 12 by the order dated 14th November  2000 in W.P. No. 2930 of 1999 which said that the 1998 settlement  was a settlement under Section 18(3) of the 1947 Act. Nevertheless  a fresh industrial dispute within the meaning of the phrase in  Section 2(k) of the 1947 Act has arisen at least between the CPL  Holders and the Adhikari group as to whether the 1998 Settlement  despite being under Section 18(3), was invalidated because of the  alleged circumstances under which it was arrived at. Additionally,  the Adhikari group may at least contend that the subsequent  modifications to Clause 7(C)of the 1998 settlement modifying and  ultimately doing away with the requirement of an ALTP was not  valid and did not form part of the settlement under Section 18(3). All  these disputes are appropriately adjudicatable by an Industrial  Tribunal under the 1947 Act.  The  High Court’s decision allowing the writ petition was  based on reasons which we cannot sustain.  Consequently its   conclusion that the issue of seniority between the respondents 7 to  12 and the writ petitioners was concluded was also erroneous.   Therefore, the question whether the letters issued by the  respondent No. 3 cancelling the letters for command training issued  to the writ petitioners could have been validly issued is, along with  other issues raised between the parties, still at large and will  ultimately have to be decided by a competent Industrial Forum as  had been rightly held by the earlier decision of the High Court in  W.P. No.2930 of 1999.       At present, we have two alternatives open to us.  We may  set aside the impugned decision of the High Court and allow the  appeal by dismissing the writ petition leaving the parties to have  their disputes thrashed out before the Industrial Forum. This would  entail raising a dispute and an order for reference being passed  under Section 10(1) of the ‘1947 Act by the appropriate  Government. We may on the other hand formulate the dispute  ourselves directing the parties to move the appropriate Government  for an order of reference.  It is the latter course which has been  urged by the appellants and the respondents 7 to 12 relying on a  decision of this Court in Hindustan Steel Works Construction Ltd.  & Anr. Vs. Hindustan Steel Works Construction Ltd. Employees  Union JT 2005 (7) SC 273.  We see no reason to take a different view from the opinion  expressed in that case particularly having regard to the need to  avoid industrial unrest in connection with the national Airlines. Apart

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from the fact that the Adhikari group have been agitating their  grievance since 1997, the issue of inter-se seniority among the  pilots needs to be resolved expeditiously since that would in turn  involve issues of command of passenger flights and ofcourse,  possible demands of shortfall.  But before so directing there is yet  another question that needs to be addressed viz. what would be the  interim arrangement pending adjudication of the disputes by the  Industrial Tribunal. When the special leave petitions were filed by the appellants  and the respondents 7 to 12 before this Court we had recorded on  25th April, 2004 that "pilots, as well as co-pilots have been sent in  the command training" (sic). The intention was to record that pilots  of the Adhikari group and the writ petitioners had been sent for  command training.  In fact the High Court while quashing the letters  of cancellation noted that six pilots of the Adhikari group(  respondents 7 to 12) had already been sent for command training  and that they need not be recalled.  However it was clarified that  this direction did not alter their position in the line seniority list.  During the pendency of these proceedings six more pilots of the  Adhikari group as well as the writ petitioners have been sent for  command training and have presumably completed it by the date of  this judgment.  The remaining two pilots of the Adhikari group,  according to the Adhikari Group, have also been cleared for  command training in the meanwhile and have started preliminary  training earlier this month. We are of the view that the Adhikari  group should be permitted to complete their command training. We have already noted that the appellants and the Adhikari  group are agreeable that in the meanwhile clause 7(C)and  Annexure D to the 1998 settlement would continue to operate but  that the writ petitioners should not claim the shortfall under the 1998  Settlement.  It seems an eminently fair suggestion except that any  amount due on account of shortfall arising out of this arrangement  must be deposited by the appellants in the Industrial Court which  will keep the same in fixed deposit with any nationalized bank  subject to any award, interim or final, that may be passed by the  Tribunal.        We, therefore, set aside the decision of the High Court and  allow the appeals. It is directed that the appropriate Government  shall refer the following questions for adjudication by the appropriate  Tribunal:

1.      Whether the 1998 settlement or any portion  thereof is liable to be set aside on the grounds of  fraud, undue influence etc. as alleged by the  Adhikari group?

2.      Whether the requirement of the ALTP licence was  necessary for co-pilots?

3.      Whether the Adhikari group was entitled to  seniority over the CPL Holders in the line seniority  list?

4.      What is the legal effect of the Conciliation Officer’s  recommendation of the Adhikari groups case and  Air India’s  acceptance thereof?

5.      To what relief are the parties entitled?

       Any of the parties to these appeals viz. the Adhikari  group or the writ petitioners and their colleagues or Air India

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may move the appropriate Government for the order of  reference with a copy of our judgment.  Till the disputes are  adjudicated by the Tribunal, the interim arrangement as  decided in an earlier part of this judgment shall operate.  The  costs of these appeals will follow the cause in the reference  proceedings.