Council for Cement & Building Materials Vs. State of Haryana & Ors  INSC 275 (15 February 1996)
Saghir S. (J) Ahmad Saghir S. (J) Kuldip Singh (J) S.Saghir Ahmad, J.
1996 SCC (3) 206 1996 SCALE (2)371
the decision of this Court in Bangalore Water Supply & Sewerage Board vs.
A. Rajappa & Ors. 1978 (1) Labour Law Journal 349 = 1978 (3) SCR 207 in
which a comprehensive definition of the word "Industry" was attempted
to be given followed by legislative changes in the Industrial Disputes Act, it
was thought that the Management or Establishments would give up their old habit
of raising preliminary issues in Industrial References as to " whether
they are an 'Industry' within the meaning of the Industrial Disputes Actor
not", but Samuel Johnson's observation that "one of the maxims of
civil law is that definitions are hazardous" is still true and this
question continues to be raised almost in every case before the Tribunal.
appellant is no exception and it has also raised the same question which has
brought this industrial litigation, still at its infancy, to this Court.
appellant is a society registered under the Societies Registration Act, 1960
and respondent no.3 is an association of its employees. In Writ Petition
No.12525 of 1991 filed in the High Court of Punjab & Haryana, respondent
no.3 prayed for a direction that the appellant should, like other industrial
establishments, have its own certified standing orders made under the
Industrial] Employment (Standing Orders) Act, 1946. The Writ Petition was
resisted by the appellant on the grounds, inter alia, that it was not an
"industry" within the meaning of the Industrial Disputes Act and,
therefore, there was no occasion for it to make its own certified standing
orders under the Industrial Employment (Standing Orders) Act, 1946. The High
Court by its Order dated 24th of March, 1992 directed the State of Haryana to refer the dispute between the
parties to the Industrial Tribunal and acting on that basis, the State of Haryana made the following reference to the
the establishment "NATIONAL COUNCIL FOR CEMENT AND BUILDING
MATERIALS" M-10, SOUTH EXTENSION -II, RING ROAD, NEW DELHI, is an
"INDUSTRY" within the meaning of definition of the terms
"INDUSTRY" as given in the Industrial Disputes Act."
appellant has already put in appearance and has filed a written statement
before the Tribunal in which he has raised certain preliminary objections
including the objection that it was not an "Industry" and
consequently no reference could be made to the Industrial Tribunal.
6. On 10th May, 1994, the Industrial Tribunal passed the
following orders:- "Both the sides agree that the following additional
issue be framed and decided as preliminary issue:
Whether the reference is bad in law? O.P.Mgt." To come up on 26.7.94 for
evidence and arguments in this issue."
Industrial Tribunal, however, by its order dated 22nd of August, 1995 directed
that the preliminary issue as also other issues will be considered together.
Its order read as under:- "Affidavits are not filed. Reply to the
application moved on 27.7.95 is filed after hearing the Ars for the parties at
length, I feel it shall be in t he fitness of things that the parties file
their affidavits in support of their rival contentions. The preliminary issues
as well as the other main issue may be considered later on. To come up on
26.9.95 for filing affidavits."
appellant challenged the above order in C.W.No.14201 of 1995 in the High Court
of Punjab & Haryana but it was dismissed on 22nd October, 1995. The appellant has now come up in appeal.
reference of a dispute to the Industrial Tribunal is made under Section 10 of
the Act. Sub-section (4) of Section 10 provides as under:- "(4) Where in
an order referring an industrial dispute to 'a Labour Court, Tribunal or
National Tribunal'(h) 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 Tribunal, as the case
may be'(i) shall confine its adjudication to those points and matters
This sub-section indicates that the extent of jurisdiction of the adjudicatory
Tribunals is confined to the points specified in the order of reference or
matters incidental thereto. Matters which are incidental to the reference may,
sometimes, assume significant proportions and may relate to questions which go
to the root of the jurisdiction of the Tribunal as, for example, question
relating to the nature of the activity of the Employer as to whether it
constitutes an industry or not, as has been done in the instant case. It is on
the determination of this question that the jurisdiction of the Tribunal to
adjudicate upon the reference rests.
Usually, whenever a reference comes up before the Industrial' Tribunal, the
Establishment, in order to delay the proceedings, raises the dispute whether it
is an "industry" as defined in Section 2(j); or whether the dispute
referred to it for adjudication is an 'industrial dispute" within the
scope of Section 2(k) and also whether the employees are "workmen"
within the meaning of Section 2(s). A request is made with that these questions
may be determined as preliminary issues so that if the decision on these
questions are in the affirmative, the Tribunal may proceed to deal with the
real dispute on merits.
We, however, cannot shut our eyes to the appalling situation created by such
preliminary issues which take long years to settle as the decision of the
Tribunal on the preliminary issue is immediately challenged in one or the other
forum including the High Court and proceedings in the reference are stayed
which continue to lie dormant till, the matter relating to the preliminary
issue is finally disposed of.
This Court in Cooper Engineering Ltd. v. P.P.Mundhe(ja), 1975(2) Labour Law
Journal 379 = 1976 (1) SCR 361, in order to obviate undue delay in the
adjudication of the real dispute, observed that the Industrial Tribunals should
decide the preliminary issues as also the main issues on merits all together so
that there may not be any further litigation at the interlocutory stage. It was
further observed that there was no justification for a party to the proceedings
to stall the final adjudication of the dispute referred to the Tribunal by
questioning the decision of the Tribunal on the preliminary issue before the
Again in S.K.Verma v. Mahesh Chandra, (1983) Labour and Industrial Cases 1483 =
1983 (3) SCR 799, this Court strongly disapproved the practice of raising
frivolous preliminary objections at the instance of the employer to delay and
defeat the purpose of adjudication on merits.
D.P.Maheshwari v. Delhi Administration, 1983 Labour and Industrial Cases 1629
1983 (3) SCR 949, this Court speaking through O,Chinnappa Reddy, J. observed
that the policy to decide the preliminary issue required a reversal in view of
the "unhealthy and injudicious practices resorted to for unduly delaying
the adjudication of industrial disputes for the resolution of which an informal
forum and simple procedure were devised with avowed object of keeping them from
the dilatory practices of Civil Courts". The Court observed that all issues
whether preliminary or otherwise, should be decided together so astorule out
the possibility of any litigation at the interlocutory staye. To the same
effect is the decision in Workmen employed by Hindustan Lever Ltd. vs.
Hindustan Lever Ltd. (1984) Labour & Industrial Cases 1573 = 1985(1) SCR
The facts in the instant case indicate that the appellant adopted the old
tactics of raising a preliminary dispute so as to prolong the adjudication of
industrial dispute on merits. It raised the question whether its activities
constituted an 'Industry' within the meaning of the Industrial Disputes Act and
succeeded in getting a preliminary issue framed on that question. The Tribunal
was wiser. It first passed an order that it would be heard as a preliminary
issue, but subsequently, by change of mind, and we think rightly, it decided to
hear the issue along with other issues on merits at a later stage to the
at this stage that the High Court was approached by the appellant with the grievance
that the Industrial Tribunal, having once decided to hear the matter as a
preliminary issue, could not change its mind and decide to hear that issue
along with other issues on merits. The High Court rightly refused to intervene
in the proceedings pending before the Industrial Tribunal at an interlocutory
stage and dismissed the petition filed under Article 226 of the Constitution.
The decision of the High Court is fully in consonance with the law laid down by
this Court in its various decisions referred to above and we do not see any
occasion to interfere with the order passed by the High Court. The appeal is
dismissed, but without any order as to costs.