The Sirsilk Ltd. & Ors Vs.
Government of Andhra Pradesh & ANR [1963] INSC 63 (20 March 1963)
20/03/1963 WANCHOO, K.N. WANCHOO, K.N.
GAJENDRAGADKAR, P.B.
GUPTA, K.C. DAS
CITATION: 1964 AIR 160 1964 SCR (2) 448
CITATOR INFO:
R 1968 SC 224 (2,3) R 1973 SC2281 (18) R 1975
SC 171 (9) R 1978 SC 982 (7) R 1981 SC1660 (7) RF 1988 SC1089 (16)
ACT:
Industrial Dispute-Award sent to Government
by the Tribunal Settlement between parties thereafter-Government, if must
publish the Award-Conflict between Award and settlement Resolution
of-Industrial disputes Act, 1947 (14 of 1947) ss. 2 (p),17,18, 19.
HEADNOTE:
The facts of the three appeals are similar
and the questions of law involved are identical. Industrial disputes having
arisen between the appellants and their workmen the disputes were referred for
adjudication. After the Tribunal forwarded their Awards to the Government the
parties in each dispute came to settlement. Thereafter letters were sent to the
Government requesting them to withhold the publication of the Awards. The
Government replied that under s. 17 of the Act it was mandatory for the
Government to publish the Awards and they could not withhold publication.
Thereupon writ petitions were filed before the High Court under Art. 226 of the
Constitution praying that the Government might be directed to withhold the
publication. The High Court held that since the provisions of s. 17 of the Act
were mandatory it was not open to the High Court to issue writs as prayed for
and rejected, the petitions. The present appeals are by way of certificate
granted by the High Court.
The main contentions in the appeals were that
the provisions of s. 17 were not mandatory but were only directory and in the
alternative that even if they were mandatory some via media had to be found in
view of the conflict that would arise between an award published under s. 17
(1) and a settlement which was binding under s. 18 (1) and therefore where
there was a settlement which was binding under s. 18 (1) it would be open to
the Government not to publish the award. It was con. tended on behalf of the
respondent that if the argument of the appellants was accepted it would create
a difficult situation in as much as it would be possible for one party or the
other to represent to the Government that the settlement had been arrived at
449 as a result of fraud, misrepresentation or undue influence and corruption
etc.
Held, that it is clear on a reading of s. 17
and s. 17A together that the intention behind s. 17 (1) is that a duty is cast
on Government to publish the award within thirty days of its receipt and the
provision for its publication is mandatory and not merely directory. When an
agreement at has been arrived at between the parties, though not in the course
courses of conciliation proceedings, it becomes a settlement as per the
definition under s. 2 (p) and s. 18 (1) lays down that such a Settlement shall
be binding on all the parties to it.
If a situation like the one in the present
case arises which may lead to a conflict between a settlement under s. 18 (1)
and an award binding under s. 18 (3) on publication, the only solution is to
withhold the award from publication.
This would not in any way affect the
mandatory nature of the provisions in s. 17 (1) for the Government would
ordinarily have to publish the award but for the special situation arising in
such cases.
If any dispute arises as to the binding
nature of the settlement on grounds of fraud or misrepresentation etc. that
would be another industrial dispute, which the Government may refer for
adjudication and if such a settlement is found not to be binding under s. 18
(1) of the Act it will always be open to the Government to publish the Award
which it had withheld.
State of Bihar v. D. N. Ganguly, [1959] S. C.
R. 1191, referred to.
CIVIL APPELLATE JURISDICTION: Civil Appeals
Nos. 220, 423 and 424 of 1962.
Appeals from the judgment and order dated
January 12, 1960 and August 19, 1960 of the Andhra Pradesh High Court, in Writ
Appeals Nos. 120 and 57 of 1960.
S.K. Bose and B. P. Maheshwari, for the
appellant(in C. A. No. 220 of 1962).
M.C. Setalvad, S. K. Bose and Sardar Bahadar,
for the appellants (in C. As. Nos. 423 & 424 of 1962).
K. R. Chaudhuri and P. D. Menon, for
respondent No, 1 (in all the appeals).
450 1963. March 20. The judgment of the Court
was delivered by WANCHOO J.-These three appeals on certificates raise the same
question and will be dealt with together. It will be enough to refer to the
facts of one appeal only i.e., No. 220, to understand the point arising for
decision, the facts in the other appeals being similar.
Briefly the facts in appeal No. 220 are that
an order referring certain disputes between the appellant and its workmen was
made to the Industrial Tribunal, Andhra Pradesh on June 6, 1956. The tribunal
sent its award to Government in September, 1957. Under s. 17 of the Industrial
Disputes Act, No. XIV of 1947 (hereinafter referred to as the Act), the award
has to be published by the appropriate government within a period of thirty
days from the date of its receipt by the government in such manner as the
government thinks fit. Before, however, the Government could publish the award
under s. 17, the parties to the dispute which had been referred for
adjudication came to a settlement and on October 1, 1957, a letter was written
to Government signed jointly on behalf of the employer and the employees
intimating that the dispute, which had been pending before the tribunal, had
been settled and a request was made to Government not to publish the award. The
Government, however, expressed its inability to withhold the publication of the
award, the view taken by the Government being that s. 17 of the Act was
mandatory and the Government was bound to publish the award. Thereupon the
appellants filed writ petitions before the High Court under Art. 226 of the
Constitution praying that the Government may be directed not to publish the
award sent to it by the industrial tribunal.
The High Court held that s. 17 was mandatory
and it was not open to Government to withhold 451 publication of an award sent
to it by an industrial tribunal. Therefore it was not open to the High Court to
direct the Government not to publish the award when the law enjoined upon it to
publish it. The writ petitions were therefore is missed. There were then
application for certificate which were granted and that is how the matter has
come up before us.
The main contention on behalf of the
appellants before us is that s. 17 of the Act when it provides for the
publication of an award is directory and not mandatory. In the alternative, it
is contended that even if s. 17 is mandatory some via media has to be found in
view of the conflict that would arise between an award published under s. 17
(1) and a settlement which is binding under S. 18(1),and therefore where there
is a settlement which is binding tinder s. 18(1 ) it would be open to the
Government not to publish the award in these special circumstance.
We are of opinion that the first contention
on behalf of the appellants, namely, that the publication of the award under s.
17 (1) is directory cannot be accepted. Section 17 (1) lays down that every
award shall within a period of thirty) days from the date of its receipt by the
appropriate government be published in such manner as the appropriate
government think fit. The use of the word "shall" is a pointer to s.
17(1 ) being mandatory, though undoubtedly in certain circumstances the word
"shall" used in a statute may be equal to the word "may".
In the present case however it seems to us that when the word "shall"
was used in s. 17(1) the intention was to give a mandate to Government to
Publish the award within the time fixed therein. This is enforced by the fact
that sub-s. (2) of s. 17 provides that "the award published under Subsection
(1) shall be final and shall not be called in question by any 452 court in any
manner what’s over". Obviously when the legislature intended the award on
publication to be final, it could not have intended that the Government
concerned had the power to withhold publication of the award. Further s. 17A
shows that whatever power the Government has in the matter of an award is
specifically provided in that section, which allows the Government in certain
circumstances to declare that the award shall riot become enforceable on the
expiry of thirty days from the date of its publication, which under s. 17 A is
the date of the enforceability of the award. Section 17-A also envisages that
the award must be published though the Government may declare in certain
contingencies that it may not be enforceable. Subsection (2) of s. 17A also
gives power to Government to make an order rejecting or modifying the award
within ninety days from the date of its publication. It is clear therefore
reading s. 17 and s. 17A together that the intention behind S. 17 (1) is that a
duty is cast on Government to publish the award within thirty days of its
receipt and the provision for its publication is mandatory and not merely
directory.
This however does not end the matter,
particularly after the amendment of the Act by Central Act XXXVI of 1956 by
which s. 18 (1) was introduced in the Act. Section 18 (1) provides that a
settlement arrived at by agreement between the employer and workmen otherwise
than in the course of conciliation proceeding shall be binding on the parties
to the agreement. -'Settlement" is defined in s. 2 (p) as meaning a
settlement arrived at in the course 'or conciliation proceeding and includes a
written agreement between the employer and workmen arrived at otherwise than in
the course of conciliation proceeding where such agreement has been signed by
the parties thereto in such manner as may be prescribed and a copy thereof has
been sent to the appropriate Government and the conciliation 453 officer. When
such an agreement has been arrived at, though not in the course of conciliation
proceedings, it becomes a settlement and s. 18 (1) lays down that such a
settlement shall be binding on the parties thereto. Further s. 18 (3) provides
that an award which has become enforceable shall be binding on all parties to
the industrial dispute and others.
Section 19 (1) provides that a settlement
comes into operation on such date as is agreed upon by the parties to the
dispute, and if no date is agreed upon, on the date on which the memorandum of
settlement is signed by the parties to the dispute. In the present case the
settlement that was arrived at between the parties to the dispute was signed on
October 1, 1957, and as it had not fixed any date for its coming into force, it
became operative from October 1, 1957 itself and was binding on the parties to
the agreement who were also before the industrial tribunal and would be bound
by the award after its publication.
The contention on behalf of the appellant in
the alternative is this. It is said that the main purpose of the Act is to
maintain peace between the parties in an industrial concern.
Where therefore parties to an industrial
dispute have reached a settlement which is binding under s. 18 (1), the dispute
between them really comes to an end. In such a case it is urged that the
settlement arrived at between the parties should be respected and industrial
peace should not be allowed to be disturbed by the publication of the award
which might be different from the settlement. There is no doubt that a
settlement of the dispute between the parties themselves is to be preferred,
where it can be arrived at, to industrial adjudication, as the settlement is
likely to lead to more lasting peace than an award, as it is arrived at by the
free will of the parties and is a pointer to there being goodwill between them.
Even though this may be so, we have still to reconcile the mandatory 454
character of the provision Contained in s. 17 (1) for the publication of the
award to the equally mandatory character of the binding nature of the
settlement arrived at between the parties as provided in s. Is (1). Ordinarily
there should be Do difficulty about the matter, for if a settlement has been
arrived at between the parties while the dispute is pending before the
tribunal, the parties would file the settlement before the tribunal and the
tribunal would make the award in accordance with the settlement. In the State
of Bihar v. D. N. Ganguly (1), dealing with an argument urged before this Court
that where a settlement has been arrived at between the parties, village an
industrial dispute is pending before a tribunal, the only remedy for giving
effect to such a settlement would be to cancel the reference, this Court
observed that though the Act did not contain any provision specifically
authorising the industrial tribunal to record a compromise and pass an award in
its terms corresponding to the provisions of O. XXIII, r. 3 of' the Code of
Civil Procedure, it would be very unreasonable to assume that the industrial
tribunal would insist upon dealing with the dispute on the merits even after it
is informed that the dispute has been amicably settled between the parties, and
there can be no doubt that if a dispute before a tribunal is ambicably settled,
the tribunal would immediately agree to make an award in terms of the
settlement between the parties. In that case this Court dealt with what would
happen if a settlement was arrived at while the matter was pending before the
tribunal.
The difficulty arises in the present case
because the proceedings before the tribunal had come to an end, and the
tribunal had sent its award to Government before the settlement was arrived at
on October 1, 1957. There is no provision in the Act dealing with such a
situation' just as there was no provision in the Act dealing with the situation
which arose where the parties came (1) [1959] S. C.R. 1191 455 to an agreement
while the dispute was pending before the tribunal. This Court held in Ganguly's
case (1), that in such a situation the settlement or compromise would have to
be filed before the tribunal and the tribunal would make an award thereupon in
accordance with the settlement.
Difficulty, however, arises when the matter
has gone beyond the purview of the tribunal as in the present case. That
difficulty in our opinion has to be resolved in order to avoid possible
conflict between s. 18 (1 ) which makes the settlement arrived at between the
parties otherwise than in the course of conciliation proceeding binding on the
parties and the terms of an award which are binding under s. 18 (3) on
publication and which may not be the same as the terms of the settlement
binding under s. 18 (1). The only way in our view to resolve the possible
conflict which would arise between a settlement which is binding under s. 18
(1) and an award which may become binding under s. 18 (3) on publication is to
withhold the publication of the award once the Government has been informed
jointly by the parties that a settlement binding under s. 18 (1) has been
arrived at.
It is true that s. 17 (1) is mandatory and
ordinarily the Government has to publish an award sent to it by the tribunal ;
but where a situation like the one in the present cases arises which may lead
to a conflict between a settlement under s. 18 (1) and an award binding under
s. IS (3) on publication, the only solution is to withhold the award from
publication. This would not in our opinion in any way affect the mandatory
nature of the provision in s. 17 (1), for the Government would ordinarily have
to publish the award but for the special situation arising in such cases.
The matter may be looked at in another way
The reference to the tribunal is for the purpose of resolving the dispute that
may have arisen between employers and their workmen.
Where a settlement (1) [1959] S. C. R. 1191
456 is arrived at between the parties to a dispute before the tribunal after
the award has been submitted to Government but before its publication, there is
in fact no dispute left to be resolved by the publication of the award. In such
a case, the award sent to Government may very well be considered to have become
infructuous and so the Government should refrain from publishing Such an award
because no dispute ramains to be resolved by it.
It is however urged that the view we have
taken may create a difficulty inasmuch as it is possible for one party or the
other to represent to the Government that the settlement has been arrived at as
a result of fraud, misrepresentation or undue influence or that it is not binding
as the workmen's representative had bartered away their interests for personal
considerations. This difficulty, if it is a difficulty, will always be there
even in a case where a settlement has been arrived at ordinarily between the
parties and is binding under s. 18 (1), even though no dispute has been
referred in that connection to a tribunal.
Ordinarily, however, such difficulty should
not arise at all, if we read ss. 2 (p), 18 (1) and 19 (1) of the Act together.
Section 2 (p) lays down what a settlement is and it includes "a written
agreement between the employer and workmen arrived at otherwise than in the
course of conciliation proceeding where such agreement has been signed by the
parties thereto in such manner as may be prescribed and a copy thereof has been
sent to the appropriate government and the conciliation officer".
Therefore the settlement has to be signed in the manner prescribed by the rules
and a copy of it has to be sent to the Government and the conciliation officer.
This should ordinarily ensure that the agreement has been arrived at without
any of those defects to which we have referred above, if it is in accordance
with the rules. Then s. 18 (1) provides that such a settlement would be binding
between the parties and v. 19 (1) provides 457 that it shall come into force on
the date it was signed or on the date on which it says that it shall come into
force.
Therefore as soon' as an agreement is signed
in the prescribed manner and a copy of it is sent to the Government and the conciliation
officer it becomes binding at once on the parties to it and comes into
operation on the date it is signed or on the date which might be mentioned in
it for its coming into operation. In such a case there is no scope for any
inquiry by Government as to the bona fide character of the settlement which
becomes binding and comes into operation once it is signed in the manner
provided in the rules and a copy is sent to the Government and the conciliation
officer. The settlement having thus become binding and in many cases having
already come into operation, there is no scope for any inquiry by the
Government as to the bona fides of the settlement. In such a case in view of
the possibility of conflict between the settlement in view of its binding
nature under s. 18 (1) and an award which might become binding on publication
under s. 18 (3), the proper course for the Government is to withhold the award
from publication to avoid this conflict. If any dispute of the nature referred
to above arises as to a. settlement, that would be another industrial dispute,
which the Government may refer for adjudication and if on such an adjudication
the settlement is found not to be binding under s. 18 (1) of the Act it will
always be open to the Government then to publish the award which it had
withheld, though we do not think that such instances are likely to be anything
but extremely rare. We are therefore of opinion that though s. 17 (1) is
mandatory and the Government is bound to publish the award received by it from an
industrial tribunal, the situation arising in a case like the present is of an
exceptional nature and requires reconciliation between s. 18 (1) and s. t8 (3),
and in such a situation the only way to reconcile the two provisions is to
withhold the publication of the award, as a binding 458 settlement has already
come into force in order to avoid possible conflict between a binding
settlement under s. 18 (1) and a binding award under s. 18 (3). In such a
situation we are of opinion that the Government ought not to publish the award
under s. 17 (1) and in cases where government is going to publish it, it can be
directed not to publish the award in view of the binding settlement arrived at
between the parties under s. 18 (1) with respect to the very matters which were
the subject-matter of adjudication under the award. We therefore allow the
appeals and direct the Government not to publish the awards sent to it by the
industrial tribunal in these cases in view of the binding nature of the
settlements arrived at between the parties under s. 18 (1) of the Act. In the
circumstances we order the parties to bear their own costs.
Appeals allowed.
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