1995 (5) TMI 246 - SC - Indian Laws

Whether by virtue of the provisions of the Industrial Disputes Act read with the Standing Orders aforesaid, the Civil Court s jurisdiction to take cognizance of such suits is barred? Held that - The suits filed by the respondents in these appeals were not maintainable. Where the dispute arises from general law of contract, i.e., where reliefs are claimed on the basis of the general law of contract, a suit filed in civil court cannot be said to be not maintainable, even though such a dispute may also constitute an industrial dispute within the meaning of Section 2(k) or Section 2-A of the Industrial Disputes Act, 1947.

Issues Involved:
1. Jurisdiction of Civil Courts
2. Nature and Character of Certified Standing Orders
3. Scope of "Industrial Dispute"
4. Applicability of Industrial Disputes Act and Sister Enactments
5. Appropriate Forum for Dispute Resolution

Detailed Analysis:

Jurisdiction of Civil Courts:
The central issue was whether the Civil Courts have jurisdiction to entertain suits filed by employees challenging their termination based on alleged violations of certified Standing Orders. The appellant-Corporation contended that such disputes should be adjudicated exclusively by the Labour Courts as per the Industrial Disputes Act. The Court examined Section 9 of the Code of Civil Procedure, which grants jurisdiction to Civil Courts unless expressly or impliedly barred. It concluded that disputes involving the enforcement of rights and obligations created by the Industrial Disputes Act or sister enactments like the Industrial Employment (Standing Orders) Act should be adjudicated by the forums created under these Acts, not Civil Courts.

Nature and Character of Certified Standing Orders:
The Court discussed whether certified Standing Orders have statutory force. It was argued that these orders, once certified, become statutory terms of employment. However, the Court clarified that while Standing Orders are binding and constitute conditions of service, they do not transform into statutory provisions. They are not delegated or subordinate legislation but statutorily imposed conditions of service. The Court referred to several precedents, including Sukhdev Singh v. Bhagat Ram, to emphasize that certified Standing Orders do not have the same status as statutory provisions.

Scope of "Industrial Dispute":
The Court elaborated on the definition of "industrial dispute" under Section 2(k) of the Industrial Disputes Act, which includes disputes connected with employment, non-employment, terms of employment, or conditions of labor. The insertion of Section 2-A expanded this definition to include disputes arising from the discharge, dismissal, retrenchment, or termination of an individual workman, making such disputes industrial disputes even if not espoused by a union or body of workmen. The Court emphasized that disputes falling within the ambit of Sections 2(k) and 2-A should be resolved by the forums created under the Industrial Disputes Act.

Applicability of Industrial Disputes Act and Sister Enactments:
The Court examined the interplay between the Industrial Disputes Act and other related enactments like the Industrial Employment (Standing Orders) Act. It concluded that disputes involving the recognition, observance, or enforcement of rights created by these enactments should be adjudicated by the forums under the Industrial Disputes Act, provided they constitute industrial disputes. The Court rejected the argument that Section 13-A of the Standing Orders Act creates a parallel forum for adjudication, clarifying that it only provides for the interpretation of Standing Orders, not for resolving industrial disputes.

Appropriate Forum for Dispute Resolution:
The Court reiterated the policy underlying the Industrial Disputes Act and related enactments, which is to provide a speedy, inexpensive, and effective forum for resolving disputes between workmen and employers. It highlighted the advantages of these forums over Civil Courts, including their informal procedures and the ability to grant appropriate reliefs. The Court suggested legislative amendments to allow workmen to approach Labour Courts directly without requiring a government reference, particularly for disputes covered by Section 2-A.

Conclusion:
The Court held that the suits filed by the respondents were not maintainable in Civil Courts and should have been adjudicated by the forums under the Industrial Disputes Act. However, given the lack of clarity in the law, the Court modified the decrees by reducing back wages to half, except in one case where the appellant-Corporation had agreed to abide by the decree. The principles enunciated in this judgment are to apply to all pending and future matters, except those where decrees have already been passed by Trial Courts and are pending in appeal. There was no order as to costs, and proceedings that have become final will not be reopened.

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