1996 (11) TMI 421 - HC - Companies Law

Issues Involved:
1. Constitutional validity of sections 66, 78(1)(A)(C), 95, 113, 115A of the Bombay Industrial Relations Act, 1946.
2. Legality of the settlement between the Gujarat State Textile Corporation (GSTC) and the Textile Labour Association.
3. Legality of the award passed by the Industrial Court, Gujarat State, on 3-9-1996.
4. Authority of GSTC and the State Government to enter into the agreement.
5. Representation and authority of the Textile Labour Association.
6. Allegations of mala fide actions and coercion in the settlement process.

Issue-wise Detailed Analysis:

1. Constitutional Validity of Sections 66, 78(1)(A)(C), 95, 113, 115A of the Bombay Industrial Relations Act, 1946:
The petitioners challenged these sections on the grounds of being ultra vires section 25-O of the Industrial Disputes Act, 1947, and articles 14, 21, and 254 of the Constitution of India. They argued that these provisions confer excessive delegation of power to the executive, which is unconstitutional. However, the court found no justification to address the constitutional validity of these provisions in the present case, as the settlement had already been accepted by the majority of the workmen and had become an award of the Industrial Court.

2. Legality of the Settlement Between GSTC and the Textile Labour Association:
The petitioners claimed that the settlement was illegal, unlawful, inequitable, and prejudicial to the rights and interests of the workmen. The respondents countered that the settlement was voluntary, lawful, and equitable, and was accepted by the majority of the workmen. The court found that the settlement was reached in consultation with the State Government and was accepted by more than 90% of the workmen, making it a valid and enforceable agreement.

3. Legality of the Award Passed by the Industrial Court, Gujarat State, on 3-9-1996:
The petitioners argued that the award was illegal and could not be enforced. The respondents maintained that the award was based on a voluntary settlement and was legally valid. The court upheld the award, noting that it was made after the settlement was accepted by the majority of the workmen and had become an award of the Industrial Court.

4. Authority of GSTC and the State Government to Enter into the Agreement:
The petitioners contended that neither GSTC nor the State Government had the authority to enter into the agreement with the Textile Labour Association. The respondents argued that the agreement was within their authority and was made in the larger interest of the workers. The court found that the agreement was valid and within the authority of the respondents, as it was made in consultation with the State Government and accepted by the majority of the workmen.

5. Representation and Authority of the Textile Labour Association:
The petitioners claimed that the Textile Labour Association was not a representative union and had no authority to enter into the settlement. The respondents argued that the association was a representative union and had the authority to negotiate on behalf of the workmen. The court found that the association was a representative union and had the authority to enter into the settlement, as it was accepted by the majority of the workmen.

6. Allegations of Mala Fide Actions and Coercion in the Settlement Process:
The petitioners alleged that the actions of the respondents were mala fide and that the settlement process involved coercion and threats. The respondents denied these allegations, stating that the settlement was voluntary and in the best interest of the workmen. The court found no evidence of mala fide actions or coercion, noting that the settlement was accepted by the majority of the workmen and had become an award of the Industrial Court.

Conclusion:
The court dismissed the petition, finding no justification to interfere in the extraordinary jurisdiction under article 226 of the Constitution of India. The court directed GSTC to accept resignations until 10-12-1996 and afford the benefits under the award to those workers who choose to opt for the package deal. The petition was dismissed with no order as to costs.

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