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 IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 4460 OF 2008 [Arising out of SLP(C) No.9243/2006]

WORKMEN  THROUGH  HINDUSTAN LEVER MAZDOOR SABHA

.......APPELLANT(S)  

Versus

HINDUSTAN LEVERS LTD. .....RESPONDENT(S)

O R D E R

Delay condoned.   Leave granted.  Heard learned counsel for appellant and

respondent.   

2. Appellant  is  one  of  the  Unions  representing  the  workmen of  respondent

company.  The workmen of the respondent company were receiving dearness allowance

without any ceiling upto 1974.  On 31.12.1974,  a settlement was entered between the

respondent  and the  another workers' Union (Lever's  Karamchari Union)  inter alia,

providing for imposition of a ceiling on the dearness allowance.  On 5.12.1977, another

settlement was entered between the respondent company and the appellant Union, which

ratified the settlement dated 31.12.1974.  According to the respondent company, both

the settlements dated 31.12.1974 and 5.12.1977 were duly registered.

3. Thereafter, the appellant Union went on agitating over the issue of ceiling on

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dearness  allowance  contending  that  the  settlement  dated  5.12.1977  was  signed  by

persons who did not have authorisation on behalf of the appellant Union and, therefore,

not binding on them.  Ultimately, the appellant Union approached the High Court of

Allahabad  in  Civil  Misc.  W.P.  No.24313/1989  seeking  a  direction  to  the  State

Government to exercise its powers under Section 4(Ka) of the U.P. Industrial Disputes

Act and refer the dispute arising out of the 'imposition of ceiling on dearness allowance

payable  to  the  workmen'  for  adjudication.   The  High  Court,  by  its  order  dated

30.7.1998,  allowed  the  said  petition  and  consequently  dispute  was  referred  to  the

Industrial Tribunal(V), Meerut and the reference was registered as Adjudication Case

No.42 of 1998.

4. The respondent filed an application before the Tribunal in the said Adj. Case

No.42/1998 referring to some subsequent events and prayed for a declaration that no

dispute survived between the respondent and its workmen and to answer the reference

accordingly. The respondent alleged that all its employees had voluntarily retired under

the Voluntary Retirement Scheme announced by the company on 7.3.2000  and had

received compensation amount in full and final settlement of all their claims and had

confirmed  in  writing  that  they  had  no  pending  or  outstanding  claims.  The  said

application was rejected by the Tribunal by an order dated 8.8.2003.  The Tribunal held

that the question that had to be examined was whether the settlements dated 31.12.1974

and 5.12.1977 were binding on the workmen or not, that the parties had already filed

pleadings and documents and the case was ripe for evidence in regard to a complex

question of fact and law; and that, therefore, the appropriate course was to permit the

parties to lead evidence and decide the dispute on merits.  It was of the view that it was

not possible to express any opinion as to whether the dispute survived or not, at that

premature stage.  

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5. The respondent challenged the said order dated 8.8.2003 before the Allahabad

High Court in C.M.W.P.  No.51129 of  2003.   The High Court allowed the said writ

petition  by  order  dated  28.5.2004.   The  High Court  referred to  the  fact  that  the

Ghaziabad unit of the respondent was closed in 2000 and all workmen had opted for

voluntary retirement under respondent's Voluntary Retirement Scheme of 2000 and had

been paid all dues.  The High Court held that in view of the said Voluntary Retirement

Scheme of  2000  opted  by all workmen, the matter pending adjudication before the

Industrial Tribunal in Adj. Case No.42/1998 had become stale and that in the changed

circumstances, it was inexpedient to allow the said proceedings to drag on.  The High

Court also referred to the fact that the dispute regarding dearness allowance had been

pending for thirty years, and the Ghaziabad unit was lying closed for five years and the

unit had no workmen in its  employment.   The High Court held that there was no

industrial undertaking nor workmen and, therefore, there was no industrial dispute and

the  appellant  Union  had  lost  its  right  to  represent  the  workmen  of  the  unit.

Consequently,  the  High  Court  quashed  the  order  dated  8.8.2003  and  directed  the

Industrial Tribunal to dispose of the application filed by the employer in the light of its

observations.  In other words, the High Court virtually directed the Industrial Tribunal

to close the pending dispute in Adj. Case No.42/1998.  The said order is challenged in

this appeal by special leave.

6. At the outset, it should be noticed that the mere fact that the unit was closed

or that all the workmen had taken voluntary retirement will not put an end to a validly

pending industrial dispute in regard to a past grievance unless the employer is able to

show that such grievance was also settled.

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7. In this case, though all the workmen might have taken voluntary retirement

under the  scheme introduced  in  2000,  the  settlement  entered (in  a standard form)

between  the  respondent  company  and  retiring  workmen  specifically  excluded  the

pending dispute relating to ceiling on dearness allowance from the settlement. The said

clause is extracted below.

“5.  On  receipt  of  the  above compensation,  the  workman will  have no  other claim  whatsoever  from  the  company  and  the payment shall  be  considered to  be  his  full  and final  settlement  of  all  dues.   However,  this agreement is without prejudice to the claim of the workman  for  the  benefits  in  the  Adj.  Case No.42/98  pending  before  Industrial  Tribunal  V Meerut  regarding  dearness  allowance.   The workman will be entitled to receive all benefits, if any as applicable, on the final decision of the case in the appropriate court, i.e. Tribunal, High Court or Supreme Court as the case may be.”

(emphasis supplied)

It is,  thus, clear that the retirement of the workmen under the Voluntary Retirement

Scheme of 7.3.2000 and payment of compensation in full and final settlement thereunder

excluded the pending dispute relating to ceiling on D.A.  Therefore, the retirement under

the Voluntary Retirement Scheme did not result in settlement of the dispute pending in

Adj. Case No.42/1998.  Unfortunately, the High Court lost sight of the said saving clause

in the Voluntary Retirement Scheme in regard to the pending dispute in Adj.  Case

No.42/1998 and proceeded on the erroneous assumption that all pending claims of the

workmen including the subject matter of Adj.  Case No.42/1998 were settled on their

retirement under the Voluntary Retirement Scheme of 7.3.2000.  The order of the High

Court cannot, therefore, be sustained.

8. The employer submitted that in the context of certain disputes relating to an

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earlier voluntary separation scheme, the Industrial Tribunal, Kanpur had made final

award dated 30.10.1998 (in Case No.38 to 80/2003) wherein the Tribunal had held the

settlements  dated  31.12.1974  and  5.12.1977  were  valid  settlements,  as  they  were

registered settlements.  It is also pointed out that when the said award dated 30.10.1998

was challenged before the High Court in W.P. No. 15533 of 1999,  the High Court in its

judgment  dated  17.4.2000,  did  not  disturb  the  finding  regarding  validity  of  those

settlements, even though on merits, it had interfered with the said award of the Tribunal.

Learned counel submitted that in view of  the categorical finding of  the Tribunal at

Kanpur that the settlement dated 5.12.1977 was valid (affirmed by the High Court on

17.4.2000) subsequent to the reference of the dispute relating to ceiling on D.A. in Adj.

Case No.42/1998, the very basis for the dispute in Adj. Case No.42/1998 disappeared

and consequently the pending dispute in Adj. Case No. 42/1998 should be considered as

having been finally settled by the award dated 30.10.1998 in Cases No.38 to 80/2003.

9. A careful examination of the Award of the Kanpur Industrial Tribunal shows

the contention of respondent is without merit.  The final award dated 30.10.1998 relied

on by the respondent company makes it clear that the Tribunal was of the view that the

registered settlements dated 31.12.1974 and 5.12.1977 were valid as the said settlements

had not been challenged by the Union. It is apparent that the award dated 30.10.1998

assumed that the settlements had not been challenged while in fact a reference in regard

to the dispute relating to the challenge had been made a few days earlier.  It cannot be

said  that  either the  award dated  30.10.1998  or the  order of  the High Court  dated

17.4.2000 had unconditionally upheld the validity of the settlements dated 31.12.1974

and 5.12.1977.  In fact, that was not the subject matter of the dispute that was being

considered by the Tribunal at Kanpur (or the High Court in the writ petition challenging

its  award).   The settlements were observed to  be  valid subject  to  challenge of  such

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settlements.  

10. In view of the above, we allow this appeal, set aside the order of the High

Court and restore the order of the Tribunal.  We would only like to add that in view of

the long pendency, the Tribunal shall endeavour to dispose of Adj.  Case No.42/1998

expeditiously.

  ...........................J.    ( R.V. RAVEENDRAN )

New Delhi;    ...........................J. July 16, 2008.              ( LOKESHWAR SINGH PANTA )