1981 (5) TMI 134 - HC - Indian Laws

Summary

Issues Involved:
1. Competence of the Reference Order under Section 4-K of the U.P. Industrial Disputes Act, 1947.
2. Validity of the Settlement Agreement and its Binding Nature.
3. Application of Principles of Natural Justice and Legitimate Expectations.
4. Existence of an Industrial Dispute.

Detailed Analysis:

1. Competence of the Reference Order under Section 4-K of the U.P. Industrial Disputes Act, 1947:
The petitioner challenged the Reference Order made by the State of Uttar Pradesh on 6th September 1977, and the subsequent order of the Industrial Tribunal dated 18th December 1978, arguing that the reference was invalid. The court held that the government retains the power to make a reference under Section 4-K of the Act even after initially refusing to do so. The court cited Supreme Court decisions (Western India Match Co. Ltd. v. Workers Union, Binny Ltd. v. Their Workmen, and Avon Services Production Agencies v. Industrial Tribunal) to support that the government can reconsider its decision based on new facts or other relevant considerations. The court concluded that the government acted within its jurisdiction in making the reference, and the employer's expectation of a final decision after the initial refusal was not justified.

2. Validity of the Settlement Agreement and its Binding Nature:
The petitioner argued that the settlement agreement dated 16th July 1973, which referred the dispute to Sri B. B. Lal, was binding and resolved the dispute. The court rejected this argument, stating that the so-called settlement was merely an agreement to arbitrate and did not constitute a settlement under Section 6-B of the Act. The agreement did not meet the statutory requirements for a settlement and was not enforceable under the Act. The court held that the dispute continued to exist despite the agreement and the review by Sri B. B. Lal.

3. Application of Principles of Natural Justice and Legitimate Expectations:
The petitioner contended that the government should have heard the management before making the reference, invoking principles of natural justice and legitimate expectations. The court held that the principles of natural justice do not apply to administrative decisions like making a reference under Section 4-K, as it does not directly affect substantive rights but merely initiates adjudication. The court referred to the decisions in A.K. Kraipak v. Union of India, Smt. Meneka Gandhi v. Union of India, and Mohinder Singh Gill v. Chief Election Commissioner, emphasizing that natural justice principles are not universally applicable to all administrative actions. The court concluded that the petitioner had no right to a hearing before the reference was made and that the government's decision did not violate any legitimate expectations.

4. Existence of an Industrial Dispute:
The petitioner claimed that the dispute was resolved by the settlement and the review by Sri B. B. Lal, and no industrial dispute existed at the time of the reference. The court found that the dispute continued to exist as the workmen remained dissatisfied and consistently agitated their grievances. The court noted that the government's initial refusal to make a reference did not resolve the dispute, and the continued existence of the dispute justified the subsequent reference. The court held that the government had sufficient material to conclude that an industrial dispute existed and had applied its mind appropriately before making the reference.

Conclusion:
The court dismissed the petition, upholding the competence of the Reference Order under Section 4-K of the Act, rejecting the binding nature of the settlement agreement, and affirming that the principles of natural justice did not require a hearing before making the reference. The court also confirmed that an industrial dispute existed, justifying the government's decision to make the reference. The petitioner's contentions were found to be without merit, and the interim orders were vacated. The court acknowledged the commendable ability of the counsel in presenting their arguments.