Report No. 122
2.8. A brief resume of these provisions will show at a glance that effective power, was conferred upon the appropriate Government to intervene in an existing industrial dispute or to interdict a threatened situation to compel the parties to resort to adjudication and to avoid direct action.
2.9. The award made by the authority empowered to adjudicate the industrial dispute is binding on the parties subject to the power of the appropriate Government under section 17.
2.10. Labour Courts, industrial tribunals, National Industrial Tribunal, all enjoy the power of compulsory adjudication. Their awards enjoy finality. The statute does not envisage any appeal over the decision of the aforementioned fora.
2.11. Since the advent of the Constitution, the awards of the aforementioned fora can be questioned by writ of certiorari, prohibition or even mandamus invoking the constitutional power of judicial review conferred on the High Court under Article 226 and the Supreme Court under Article 32. In the absence of any appellate fora, as a matter of course, a large number of awards are challenged either before the High Court or before the Supreme Court of India. Thus, High Courts and the Supreme Court, while exercising extraordinary jurisdiction under the Constitution, have for all practical purposes become appellate fora.
2.12. The twin purposes underlying the enactment of Industrial Disputes Act, 1947, were to provide mode and machinery for arbitration/compulsory adjudication between two segments of society amongst whom conflict of interest was inherent as also to arm the State with power to effectively intervene in industrial disputes which, if left to the warring parties to settle by direct action and confrontation, would certainly hamper and thwart economic regeneration of the nation. If the industrial disputes are sought to be resolved by the force of might, there was a distinct possibility of chaos and anarchy in the Society.
The Industrial Disputes Act, 1947, is, in the opinion of the Supreme Court, a benign measure which seeks to pre-empt industrial tensions, provide the mechanics of dispute-resolutions and set up necessary infrastructure so that the energies of partners in production may not be dissipated in counter-productive matters and assurance of industrial justice may create a climate of goodwill. Industrial peace is a national need and, absent law, order in any field will be absent. Chaos is the enemy of creativity sans which production will suffer.
Thus, the great goal to which the I.D. Act is geared is legal mechanism for canalising conflicts along conciliatory or adjudicatory processes.1 The emerging concept of welfare State, which was in the air since independence, implied an end to exploitation of workmen and they were to be ensured a living wage, decent conditions of work and dignity of labour.
Some legal mechanism was necessary and one underlying the Industrial Disputes Act is 'geared to conferment of regulated benefits to workmen and resolution, according to sympathetic rule of law, of the conflicts, actual or potential, between management and the workmen. Its goal is amelioration of the conditions of workers, tempered by a practical sense of peaceful co-existence, to the benefit of both-not a neutral position but restraints on laissez faire and concern for the welfare of the weaker lot'.2
1. Life Insurance Corporation v. D.J. Bahadur, (1981) 1 SCC 315 (334-335).
2. Bangalore Water Supply and Sewerage Board v. Rajappa, (1978) 2 SCC 213 (232).
2.13. With the pace of industrialisation, numerous labour courts and industrial tribunals had to be set up throughout the length and breadth of this country. Each forum was having power to make awards with finality attaching to it. What was inherent in this situation was. that conflicting awards, decisions and approaches would emerge.
An approach to the High Court under Articles 226-227 of the Constitution would, at best, bring about some uniformity at the State level but the High Courts inter se differ. The situation was agonising for industrial establishments having inter-State operations or having production units in more States than one and being subject to jurisdiction of different High Courts. Ultimately the matter had to be taken to the Supreme Court which was both dilatory and time consuming.
2.14. The situation herein discussed attracted the attention of the law makers "which, in a welfare state, cannot afford to look askance at industrial unrest and industrial disputes".1 The law makers, being aware of a need to provide uniformity in the matter of conditions of service and benefits which the workmen may enjoy as a consequence of industrial adjudication, enacted Industrial Disputes (Appellate Tribunal) Act, 1950.
The establishment of Appellate Tribunal having all-India jurisdiction was thus a natural response to the need for a measure of uniformity of underlying principles and norms to govern the awards of the different Industrial Tribunals. Accordingly, the Industrial Disputes (Appellate Tribunal) Act, 1950, was put on the statute book. It provided for constituting a Labour Appellate Tribunal for hearing appeals from the awards or decisions of Industrial Tribunals in accordance with the provisions of the Act. Section 7 of the Act conferred jurisdiction on the Appellate Tribunal to entertain an appeal from any award or decision of Industrial Tribunal if-
1. Dayabhai Ranchhoddas Shah v. Jayantilal, Maganlal, 1973 Lab & IC 967.
(a) the appeal involves any substantial question of law, or
(b) the award or decision is in respect of any of the following matters, namely:-
(ii) bonus or travelling allowance,
(iii) any contribution paid or payable by the employer to any pension fund or provident fund,
(iv) any sum paid or payable to, or on behalf of, the workmen to defray special expenses entailed on him by nature of his employment,
(v) gratuity payable on discharge,
(vi) classification by grade,
(vii) retrenchment of workmen,
(viii) any other matter which may be prescribed.
Practically the entire gamut of industrial relations was covered and any award on any of these aspects would become appealable to the Appellate Tribunal. Even if the award does not cover any of the aforementioned items, an appeal can still be entertained by the Appellate Tribunal on the footing that the appeal involves a substantial question of law.
Almost all awards became appealable to the Appellate Tribunal. Undoubtedly, the Tribunal having all-India jurisdiction and an all-India perspective could, by exercise of its appellate jurisdiction, bring about uniformity in the matter of industrial relations which otherwise would have almost developed into a law of jungle because of conflicting awards by different tribunals including those having jurisdiction in the same State.
2.15. Somehow, this Appellate Tribunal incurred the wrath of the leading national organisations of workmen. As it was inherent in the situation, the haves, i.e., the employers, were financially well off and could afford the luxury of litigation. They preferred numerous appeals to the Appellate Tribunal and, according to workmen, there was inordinate delay in the disposal of these appeals whereby the implementation of awards was held up and thereby prolonged the litigation.
The workmen with their weak staying power could ill-afford such delay while on the other hand the employers protracted the litigation by casualty preferring appeal and abused the inherent tendency of every judicial process, namely, delay. Undoubtedly, what was then considered the prolongation of the litigation by the Appellate Tribunal taking roughly about two years on an average in deciding appeals has now boomeranged by its abolition.
There was also a feeling among the workmen that the Appellate Tribunal, being manned by the retired Judges of the High Courts, disclosed a tilt in favour of the management disclosing a claps bias, compounded by the lack of knowledge of industrial relations. Crass legalistic approach and lack of commitment to social justice in deciding appeals further accentuated the feeling of the workmen and a near unanimous demand was voiced for the abolition of the Labour Appellate Tribunal.
This found its echo in the Statement of Objects and Reasons accompanying the Industrial Disputes (Amendment and Miscellaneous Provisions) Bill, 1955, which inter alia made provision for abolition of Labour Appellate Tribunal. It was therein stated that: "There is a large volume of criticism the appeals filed before the Appellate Tribunal take a long time for disposal and involve a great deal of expenditure which the workers cannot afford."
The employers on the other hand-contended that the Appellate Tribunal has introduced considerable uniformity in the basic principles underlying industrial awards and was building up sound case law on industrial relations. They asserted that an appellate forum was a necessary adjunct of compulsory adjudication and its abolition, while retaining Industrial Tribunals and the method of compulsory adjudication, would again usher in a jungle of conflicting awards.
Ultimately, in a democracy, the voice of numerically stronger section prevailed. Shri K.K. Desai, formerly Labour Minister, said during the discussion on the Industrial Disputes (Amendment and Miscellaneous Provisions) Bill, 1955, that: 'It is not that justice is not being done but the workers should believe that the justice is being done to them as expeditiously as possible and, therefore, the Appellate Tribunal is going'. No factual data was supplied to the Parliament as how much delay an appeal to the Tribunal entails.
At any rate, it was stated in the Statement of Objects and Reasons accompanying the Industrial Disputes (Amendment and Miscellaneous Provisions) Bill, 1955, that Industrial Disputes (Appellate Tribunal) Act, 1950, be repealed while conceding that the Appellate Tribunal had achieved some uniformity in the basic principles governing awards of Industrial Tribunals but the consideration of future uniformity had to be balanced against the requirements of speedy settlement of industrial disputes.1
Even though no formal enquiry was made, it appears that on an average the Appellate Tribunal took two years to dispose of an appeal before it. Therefore, the execution and implementation of the award was postponed at best by preferring of the appeal by two years. When it was pointed out that some uniformity was necessary in industrial relations which the Appellate Tribunal brought about, it was conceded that the Supreme Court would certainly take care of it in future. On that note, the Labour Appellate Tribunal was formally abolished in 1956.
1. B.S. Narul The Abolition of Labour Appellate Tribunal, pp. 272-279.