Bhavnagar Municipality Vs. Alibhai
Karimbhai & Ors  INSC 46 (8 February 1977)
CITATION: 1977 AIR 1229 1977 SCR (2) 932 1977
SCC (2) 350
Industrial Dispute Act, S. 33(1)(a), whether
contravened by retrenchment of workers directly involved in dispute pending
before Tribunal--Contravention of s. 33, whether automatically leads to
reinstatement of retrenched workers.
An industrial dispute between the appellant
and its workmen including the respondents, was pending before the Industrial
Tribunal. The dispute, inter alia, related to the demand for permanent status
of the respondents who were rated workers of the water works section of the
Municipality. Meanwhile, without obtaining the Tribunal's prior permission, the
appellant retrenched the respondents. On a complaint by the respondents u/s.
33-A of the Industrial Disputes Act, the Tribunal made an award holding that
the appellant had contravened s. 33(1)(a) of the Act, and directed reinstatement
of the respondents. The complaint was not adjudicated on merits. The appellant
filed a writ petition which was dismissed in limine by the High Court.
Allowing the appeal, but agreeing that the
appellant had contravened s. 33 ( I ) (a) and that the respondents' complaint
u/s. 3 3 ( 1 ) (a) was maintainable, the Court restored the respondents'
complaint for disposal on merits by the Tribunal.
HELD: (1) The character of the temporary
employment of the respondents being a direct issue before the Tribunal, that
condition must subsist and cannot be altered to their prejudice by putting an
end to that temporary condition.
This could be done only with the express
permission of the Tribunal.
[933-G-H] The Court further observed:
To permit rupture in employment, in this
case, without the prior sanction of the Tribunal will be to. set at naught the
avowed object of section 33 which is principally directed to preserve the
status quo under specified circumstances in the interest of industrial peace
during the adjudication.
[936 A-B] (2) In a complaint under s. 33-A,
even if the employer is found to have Contravened the provisions of section 33,
the Tribunal has to pronounce upon the merits of the dispute between the
parties. For the purposes of the Act, the complaint under s. 33A takes the form
of a reference of an industrial dispute by the appropriate authority and the
same has to be disposed of in a like manner. [936 C-D] (3) The Tribunal has
committed an error of jurisdiction in ordering-reinstatement of the respondents
and declining to adjudicate the matter and to make its award on the merits as
required under the law. [936 D]
CIVIL APPELLATE JURISDICTION: Civil Appeal
No. 900 of 1976.
Appeal by Special Leave from the Judgment and
Order dated 8-3-1976 of the Gujarat High Court in Spl. Civil Appln. No. 263 of
P.H. Parekh and (Miss) Manju jetley for the
S.C. Agarwal, V.J. Francis and A.P. Gupta for
933 The Judgment of the Court was delivered
by GOSWAMI, J. This appeal by special leave at the instance of the Bhavnagar
Municipality is directed against the order of the Gujarat High Court dismissing
in limine its writ application challenging the award of the Industrial
Tribunal, Gujarat, made under section 33A of the Industrial Disputes Act
(briefly the Act).
There was an industrial dispute pending
between the Bhavnagar Municipality (briefly the appellant) and its workmen
before the Industrial Tribunal 'in Reference No. 37 of 1974 referred to it
under section 10(1) (d) of the Act on March 5, 1974. The said industrial
dispute related to several demands including the demand for permanent status of
the daily rated workers of the Water Works Section of the Municipality who had
completed 90 days' service. While the aforesaid industrial dispute was pending
before the Tribunal, the appellant, on September 30, 1974, passed orders
retrenching 22 daily rated workmen (briefly the respondents) attached to the
Water Works Section of the Municipality. It is not disputed that the appellant
had complied with section 25F of the Act and due retrenchment compensation had
been paid to those workers. On June 20, 1975, the respondents filed a complaint
to the Tribunal under section 33A of the Act for contravention of section 33 of
the Act by the appellant.
Neither party adduced any oral evidence
before the Tribunal but relied only upon documents produced before it.
On October 30, 1975, the Tribunal made its
award holding that the appellant contravened section 33(1)(a) of the Act and,
therefore, directed reinstatement of the respondents.
The appellant preferred a writ application
before the High Court which was dismissed in limine, as stated above. Hence
this appeal by special leave.
Two questions arise for decision in this
appeal. First, whether the appellant contravened section 33 (1)(e) of the Act
by ordering retrenchment of the respondents who, along with other workers, were
directly involved in the industrial dispute pending before the Tribunal.
Second, whether contravention of section 33 will automatically lead to an order
of reinstatement of the respondents, as has been held by the, Tribunal.
It is common ground that the appellant did
not obtain prior permission of the Tribunal before retrenching the respondents.
It is well settled that a complaint under
section 33A is maintainable only if the employer contravenes section 33 of the
Act. It is submitted by Mr. Agarwal, on behalf of the respondents, that the
object of section 33 should be borne in mind in considering the question about
alteration of conditions of service under section 33(1)(a) of the Act. He
submits that since the respondents were directly involved in the dispute and
the question of their permanent status from a casual or temporary status formed
the subject matter of the dispute, the reference. has been made nugatory by the
action of the appellant in retrenching them.
'Mr. Parekh, on the other hand, submits that
retrenchment of the respondents does not' involve alteration of conditions of
service and hence there is no contravention of section 33 of the Act.
934 There is no complaint by Mr. Agarwal that
there is any noncompliance by the appellant with section 28F of the .Act.
Mr. Agarwal further rightly concedes that he
cannot bring his case under section 33(1) (b) or under section 33(2)(b) since
it is not a case of discharge or dismissal for misconduct. His entire
submission is based on section 33(1)(a) of the Act.
Section 33 of the Act so far as material for
us may be set out:
"33(1) During the pendency of any ....
proceeding before a ......
Tribunal .... in respect of an industrial
dispute, no employer shall-(a) in regard to any matter connected with the
dispute, alter, to the prejudice of the workmen concerned in such dispute, the
conditions of service applicable to them immediately before the commencement of
X X X save with the express permission in
writing of the authority before which the proceeding is pending".
There is a clear prohibition in section
33(1)(a) against altering conditions of service by the employer under the
circumstances specified except with the written permission of the Tribunal or
other authority therein described.
In order to attract section 33(1)(a), the
following features must be present:
(1) There is a proceeding in respect of an
industrial dispute pending before the Tribunal.
(2) Conditions of service of the workmen
applicable immediately before the commencement of the Tribunal proceeding are
(3) The alteration of the conditions of service
is in regard to a matter connected with the pending industrial dispute.
(4) The workmen whose conditions of service
are altered are concerned in the pending industrial dispute.
(5) The alteration of the conditions of
service is to the prejudice of the workmen.
The first feature is admittedly present in
this case since action has been taken by the appellant in retrenching the
respondents during the pendency of the proceeding before the Tribunal. The
point that requires consideration is whether the other features are also
present in the instant case.
Before we proceed further we should direct
our attention to the subject matter of the industrial dispute pending before
the Tribunal. It is sufficient to take note of the principal item of the
dispute, namely, the demand of the respondents for conversion of the temporary
status of their employment into permanent. To recapitulate briefly the
appellant employed daily rated workers to do the work of boring and hand pumps
in its Water Works Section. These workers have been in employment for over a
year. They claimed permanency in their employment on their putting in more than
90 days' service. They also demanded two pairs of uniform every year, cycle
allowance at the rate of Rs.
10/per month, Provident Fund benefit and
National Holidays and other holidays allowed to the other workers. While this
particular dispute was pending before the Tribunal, the appellant decided to
entrust the work, which had till then been performed by these workers in the
Water Works Section, to a contractor. On the employment of the contractor by
the Municipality for the self-same work, the services of the respondents became
unnecessary and the appellant passed the orders of retrenchment. It is,
therefore, clear that by retrenchment of the respondents even the temporary
employment of the workers ceased while their dispute before the Tribunal was
pending in order to improve that temporary and insecure status.
Retrenchment may not, ordinarily, under all
circumstances, amount to alteration of the conditions of service.
For instance, when a wage dispute is pending
before a Tribunal and on account of the abolition of a particular department
the workers therein have to be retrenched by the employer, such a retrenchment
cannot amount to alteration of the conditions of service. In this particular
case, however, the subject matter: being directly connected with the conversion
of the temporary employment into permanent, tampering with the status quo ante
of these workers is a clear alteration of the conditions of their service. They
were entitled during the pendency of the proceeding before the Tribunal to
continue as temporary employees hoping for a better dispensation in the pending
adjudication. And if the appellant wanted to effect a change of their system in
getting the work done through a contractor instead of by these temporary
workers, it was incumbent upon the appellant to obtain prior permission of the
Tribunal to change the conditions of their employment leading to retrenchment
of their services. The alteration of the method of work culminating in
termination of the services by way of retrenchment in this ease has a direct
impact on the adjudication proceeding. The alteration effected in the temporary
employment of the respondents which was their condition of service immediately
before the commencement of the proceeding before the Tribunal, is in regard to
a matter connected with the pending industrial dispute.
The character of the temporary employment of
the respondents being a direct issue before the Tribunal, that condition of
employment, however insecure, must subsist during the pendency of the dispute
before the Tribunal and cannot be altered to their prejudice by putting an end
to that temporary condition. This could have been done only with the express
permission of the Tribunal. It goes without saying that the 936 respondents
were directly concerned in the pending industrial dispute. No one also deny
that snapping of the temporary employment of the respondents is not to their
All the five features adverted to above are
present in the instant case. To permit rupture in employment, in this case,
without the prior sanction of the Tribunal will be to set at naught the avowed
object of section 33 which is principally directed to preserve the status quo
under specified circumstances in the, interest of industrial peace during the
adjudication. We are, therefore, clearly of opinion that the appellant has
contravened the provisions of section 33(1)(a) of the Act and the complaint
under section 33A, at the instance of the respondents, is maintainable.
The submission of Mr. Parekh to the contrary
cannot be accepted.
That, however, does not conclude the matter.
The Tribunal was clearly in error in not adjudicating the complaint on the
merits. It is well settled that in a complaint under section 32A, event if the
employer is found to have contravened the provisions of section 33, the
Tribunal has to pronounce upon the merits of the dispute between the parties.'
The order passed in an application under section 33A is an award similar to one
passed in a reference under section 10 of the Act. The award passed has to be
submitted to the Government and the same has to be published under section 17
of the Act. For the purposes of the Act the complaint under section 33A takes,
as it were, the form of a reference of an industrial dispute by the appropriate
authority and the same has to be disposed of in a like manner.
The Tribunal has committed an error of jurisdiction
in declining to adjudicate the matter and to make its award on the merits as
required under the law. The High Court was, therefore, not right in dismissing
the writ application of the appellant in limine. We should also. observe that,
in the absence of adjudication on the merits by the Tribunal, the High Court
was not right in holding that the retrenchment by the appellant was "a
gross act of victimisation".
In the result the order of the High Court is
It follows that the award of the Tribunal
ordering reinstatement of the respondents fails and is set aside. We should
also add that the. observations of the Tribunal with regard to the question of
prosecution of the appellant under sections 31 and 32 of the Act were not at
all pertinent in an enquiry under section 33A and ought not to have been made.
The writ application in the High Court stands allowed to the extent indicated.
The appeal is allowed as directed in this order. The complaint under section
33A stands restored to the file of the Tribunal for disposal on the merits in
accordance with law and in the light of this judgment. The appellant, however,
shall pay the costs of the respondents as ordered at the time of granting of
the Special Leave.
M.R. Appeal allowed.