M/S. Hindustan Fasteners Pvt. Ltd Vs. Nashik Workers Union  Insc 674 (19 October 2006)
Sinha & Dalveer Bhandari
out of S.L.P. (C) No. 24626 of 2004] S.B. SINHA, J :
of a settlement arrived at by and between the parties hereto falls for
consideration in this appeal which arises out of a judgment and order dated
8.12.2000 passed by the High Court of Judicature at Bombay in First Appeal No. 521 of 1992.
herein is engaged in engineering activities. Respondent No. 1 is a trade union
registered under the Trade Unions Act. Appellant was a sick unit as envisaged
under the Sick Industrial Company (Special Provision) Act, 1985. A settlement
was arrived at on 11.5.1990 by and between the parties hereto in regard to the
demands raised on behalf of the workmen. The period covered by the settlement
was 1.01.1989 to 30.12.1992. The workmen thereafter went on strike. Several
demands were also raised. A second settlement was arrived on 24.5.1993. In the
preamble of the said settlement, it was stated:
company has enforced lockout of its employees on and from 14.1.93 for the
reasons mentioned in the company's lock out notice dated 28.12.90 and the said
lockout is still continuing. In view of the long duration of the lockout and
protracted court proceedings in the Industrial Court, Nashik and elsewhere the
parties to the settlement felt a need to find out long term solution to the
problems faced by them. The parties also sought the assistance of the Deputy
Commissioner of Labour, Nashik and in view of the discussions between the
parties the acceptable solution have been found by them and they have settled
the entire disputes between them over the clauses of the lock-out i.e. still
continuing and the Charter of Demands of the Union served on behalf of the
workmen" Clause 20 of the said settlement reads as under:
this settlement is in package deal viz-a-viz full demands raised by the Union
under its charter of demands dated 1st January, 1993 and as well as elsewhere.
It is expressly understood that this settlement is in full and final settlement
of all the said demands and settles all demands of the Union/ Workmen made till date of whatsoever nature.
as of the demands as set out in the charter of demands and elsewhere, referred
to hereinabove but not specifically dealt within this settlement are hereby
treated as having been withdrawn and/ or not pressed by the Union and the
workmen and settled the same accordingly. It is further agreed that during the
currency of this settlement, the Union
and the workmen shall not raise any fresh demand whatsoever, whether covered by
this settlement or otherwise and whether involving financial burden or not. No
other demands of whatsoever nature shall be made by the Union or the workmen either directly or indirectly. Any
demand made shall have the effect of nullifying this settlement."
Paragraphs 11, 12 and 13 of Clause 23 and Clauses 27 and 28 of the said
settlement read as under:
The settlement shall encompass this settlement as well previous settlement
dated 11.5.90 and shall constitute a whole contract between the parties. These
settlements have rendered substantial benefits on the workmen and in view of
the same, it is agreed between the partiers that there will be no work
stoppage/ go slow during the pendency of this settlement. Any breach of this
settlement shall render the above mentioned settlements as null and void.
The parties expressly agree that the definition of "wages" in various
statutes in the industrial field will be followed by them for the purpose of
their application, enforcement and implementation in any event. Payments under
the terms of their settlement agreed to be made and accepted by the parties
will not be affected and no further and additional claims will be made or
canvassed by the workmen under these laws for increase in benefits and if made
shall deem as covered and adjusted by this settlement or under the terms of
Except to the extent expressly modified in this settlement, all other existing
rights, and obligations and conditions of previous settlements shall continue
with full force and effect during the operation of this settlement.
No. 27: Bonus Bonus for the year 1990-91, 1991-92 will be 8.33%. No bonus is
due and payable for the year 1992-93 and as the workmen did not work during
this period. Bonus for the year 1993-94 will be 9%. Bonus for the years 1994-95
and 1995-96 will be 10% and for the year 1997-98 will be 12%.
it is provided that the management on its own shall review the balance sheet
and decide about the quantum of bonus payable to the workmen and in the event
of any upward revision is necessitated under the provisions of Payment of Bonus
Act, 1965 excess amount minus agreed bonus shall be paid to the employee. In
any circumstances the workmen will not raise any dispute about the quantum of
bonus. The management decision shall be final. In case the company balance
sheet shows accumulated losses in the above years, the amount paid in excess of
statutory min. will be by the way of ex-gratia for the purpose of industrial
peace, productivity and shop floor discipline. Bonus for the year 1990-91 will
be paid in August and for the year 1991-92 will be paid in October, 1993.
No. 28 That the various clauses of the agreement/ settlement form one package
agreement/ settlement and none of the clauses in this agreement/ settlement in
separable from the remaining clauses of the agreement/ settlement."
However, an industrial dispute was raised in the following terms:
the lock out effected by the management w.e.f. 14.1.1992 is justified? If not,
what relief the workers are entitled for? The said industrial dispute was
referred to for adjudication by the appropriate government before the Industrial Court, Nashik. Appellant herein in its
written statement inter alia raised the question as regards maintainability of
the said reference relying on or on the basis of the said settlement dated
The reference is not tenable and maintainable as there was no dispute in
existence after the settlement dated 24.5.1993 arrived between Nashik Workers
Union and the Company, Hindustan Fasteners Pvt. Ltd., hence the reference is
immature in the eyes of law
reference is also not maintainable in view of the settlement dated 24.5.1993 as
per the Clause No. 20 of the said settlement. It was full and final settlement
and all the demands were settled. It was also made clear that all other demands
and claims were relinquished by the workmen and the Union and as such the reference is to be rejected" It
was further stated:
The Employer Company welcome any investigation that the Hon'ble Tribunal may
undertake, since it would definitely conclude that the lockout was justified
and its prolongation was due to the illegal tactics of the Nashik Workers
Union." A dispute, thus, existed between the parties as regards
applicability of the said settlement to the reference..
Tribunal made an award in the said reference on 19.1.2001 stating:
I have gone through the said settlement but the said settlement nowhere makes
any reference regarding the wages to be paid to the workers for lock out
period. But the said settlement is regarding other demands. If the issue
regarding the payment of lock out period would have been discussed between the
parties then, certainly the said issue could have been mentioned in the
settlement. It is further the contention of the company that in view of the
Clause 20 of the settlement all the demands between the parties were settled"
The Tribunal in its award further stated:
After perusal of the Clause 20 referred above it makes clear the demand should
be raised which will directly involve financial burden on the company, but it
is permanent to note here that no such demand is raised by the Union, on the
contrary, the present reference is referred by the Government in view of
P.A.M.S. proceeding pending before the Dy. Commissioner of Labour prior to
signing the said settlement. The company as well as the Second Party workers
both were aware about P.A.M.S. proceedings pending before the Dy. Commissioner
of Labour regarding the lock out. Therefore, they ought to have been mentioned
the same in the present settlement so as to resolve the dispute. But, as the
said issue is not taken into the present settlement referred above by stretch
of imagination could not be said that the said issue was settled finally in
view of settlement dated 24.5.1993 signed between the parties.
the contention of First Party Company that present reference is not
maintainable could not be accepted. Hence, I answer the issue in the
negative." It was further found that although Appellant sought to justify
the lock- out declared by it but in support of the said plea, no witness was
examined on its behalf. In the aforementioned premise, by reason of the said
award, the Industrial Tribunal directed:
The lock out declared by the Company w.e.f. 14.1.1992 is unjustified.
workers are entitled for the wages for lock out for period from 14.1.1992 to
First Party Company is directed to pay the wages to the concerned workers in
the period of 14.1.1992 to 2.6.1993 within two months from the date of the
publication of the Award." A writ petition was filed thereagainst. A
learned Single Judge of the High Court in its judgment dated 23.04.2002 noticed
the contentions of Appellant herein that when the settlement was arrived at,
reference had already been made by the appropriate authority. However, it was
opined that the said settlement did not contain any provision as to whether the
workmen had given up their rights of wages during the period the factory was
under lock-out. The writ petition was dismissed. An intra-court appeal filed thereagainst
by Appellant was also dismissed by reason of the impugned judgment stating that
under the aforementioned settlement the workmen had not given up their rights
Naphade, learned senior counsel appearing on behalf of Appellant, raised a short
contention in support of this appeal. It was urged that the settlement was to
be read in its entirety. So read, the learned counsel would contend, it would
be apparent that all disputes and differences between the parties and all
demands raised by reason of the Charter of Demands dated 1.01.1993 and all
other demands having been resolved, the question of directing payment of any
wages during the period for which the factory was under lock-out did not and
could not arise.
Colin Gonsalves, learned senior counsel appearing on behalf of Respondent, on
the other hand, would submit that the Charter of Demands was in relation to the
specific issues as, for example, bonus, festival allowance, pay scale, etc.
purport and object of a settlement arrived at by and between the management and
the workmen is undisputedly required to be construed keeping in view its
salutary effect. It is aimed at maintenance of industrial peace and harmony. A
settlement, therefore, although is required to be read for upholding the
validity thereof like any other agreement, it should be read in its entirety so
as to ascertain the intention of the parties behind the same.
true that in the said settlement, not only the Charter of Demands served on the
management on or about 1.01.1993 was referred to, but the exchange of letters
between the parties had also been referred to, but the intention of the parties
is to be gathered having regard to the circumstances attending thereto.
had been a lock-out and a protracted court proceeding. A long term solution was
to be found out. The settlement was in relation to the purported causes of the
lock-out. It was still continuing. A Charter of Demands of the Union was served on behalf of the workmen. It did not
relate to wages of the workmen during the period of lock-out. Clause 20 of the
said settlement must, therefore, be read keeping in view the aforementioned
backdrop of events. But, before we embark upon the said question, we may notice
the Charter of Demands dated 1.01.1993. The demands of workmen referred to pay
scale, classification, dearness allowance, leave, various allowances including travelling
allowance, washing allowance and various other allowances as specified therein
e.g., uniform, festival advance, etc.
entered into by and between the parties were in relation to the aforementioned
demands. It did not speak of the claim of wages, although when the settlement
was arrived at, the industrial dispute was pending.
thus, the intention of the parties been to settle their disputes also in
relation to legality or otherwise of the lock-out declared by the management,
it was expected to have been stated so explicitly therein. It was also expected
that the parties would file the said settlement before the Industrial Tribunal
so that an award could be passed in terms thereof.
20 of the said settlement provides for a package deal vis-a-vis all the demands
raised by the Union. The package deal was in relation
to the Charter of Demands dated 1.01.1993 and any other document including the
letters exchanged between the parties pursuant thereto or in furtherance
thereof. The subject matter of settlement was 'all demands of whatever nature'
in terms whereof the workmen might not have been able to make any other demand,
but, on a bare perusal of the said settlement, it is apparent that the
expression which has repeatedly been used was the 'Charter of Demands'.
keeping the industrial dispute pending, Respondents had not raised any fresh
21 refers to the previous settlement also. The rights of the workmen under the
existing settlement were not adversely affected. If they have worked, they
would be entitled to wages. If they have reported for duties during the period
of lock-out which was illegal, they were entitled to the wages for the said
furtherance of the said Charter of Demands, the parties entered into several
other correspondences. In terms of the settlement, the parties settled their
disputes in relation to the demands raised. The wages to be paid to the workmen
which they had claimed as of right was not and could not have been the subject
matter of any payment or settlement. Whereas the concept of a demand must be
held to be relating to a right higher than the existing right, the workmen were
entitled to raise a claim in relation to their existing right and in that view
of the matter financial implication therefor cannot be a ground for refusal
thereof. If a claim is to be withdrawn by reason of a settlement, the same must
find a specific mention therein.
of course, to the parties acting on the settlement, the workmen had promised
that they would not go for 'work stoppage' or 'go slow' but then in terms of
Paragraph 12 of Clause 23 of the said settlement, it had categorically been
reiterated that the expression "wages" shall be given the same
meaning as obtaining in the statute. The right to enforce the claim for wages
both in the first settlement as also the second settlement was, therefore, not
given up. It was further stated that no additional claims would be made for
increase of benefits. Paragraph 13 of Clause 23 of the said settlement also
refers to existing rights and obligations subject, of course, to the
modification made therein. By reason of the said settlement, the workmen
surrendered their rights of bonus. We have noticed hereinbefore that the
management, although questioned the legality and/ or validity of the reference,
but at the same time also welcomed the same stating that thereby they had got
an opportunity to establish that the lock-out declared by them was not illegal.
But, then no witness was examined to prove the said fact.
parties, therefore, made it clear that the claim of wages raised on behalf of
the workmen on the premise that the lock-out was illegal was not the subject
matter of the settlement. The Tribunal, in our opinion, is right in arriving at
the finding that the intention of the parties must be gathered from the
attending circumstances; one of them being that although the parties were aware
that the industrial dispute was pending but no reference thereto was made in
difficult to accept the contention of Mr. Naphade that in the facts and
circumstances of this case, provisions of Section 92 of the Evidence Act would
have any role to play. It is not the contention of Respondents that the
settlement was not to be read as a full or final settlement between the parties
but the same must be read as meaning that the settlement was only in respect of
the Charter of Demands and other demands made by the Union from time to time in its various letters.
of a document so as to ascertain the intention of the parties is in no way
controlled by the provisions of Sections 91 or 92 of the Evidence Act. The
document has to be interpreted applying the known principles of construction
and/ or canons.
fact, in the special leave petition, Appellant itself has contended:
That because the Hon'ble High Court should have appreciated the fact that at
the time of reference the contesting parties were negotiating the Settlement.
So in view thereof it was the duty of the Conciliation Officer under Section
12(2) and 12(3) of the Industrial Disputes Act for bringing about a settlement
of the dispute without delay and investigate the dispute and all such matters
affecting the merits and the settlement thereof.
it is pertinent to state that the Conciliation Officer has enough powers to
investigate the cause of dispute and enforce a settlement." If that was
the stand of Appellant before the Conciliation Officer, they could have asked
him to close the conciliation proceedings. They did not do so.
the principles of interpretation of a document and having regard to the
circumstances attending thereto, we are of the opinion that the findings of the
tribunal and the High Court cannot be faulted with.
the reasons aforementioned, we do not find any merit in this appeal which is
dismissed accordingly with costs. Counsel's fees assessed at Rs.10,000/-.