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2009 (4) TMI 1050 - SC - Indian Laws

Issues Involved:
1. Whether the appellant was estopped from taking a different stand in the subsequent writ petition (WP 1673/2005) due to the stand taken in WP No. 1267 of 1999.
2. Whether the decision of the central government refusing reference requires interference.

Issue-wise Detailed Analysis:

Re: Question (i) - Estoppel from Taking a Different Stand
1. Appellant's Argument: The appellant union argued that contract labour could claim that the contract between the principal employer (IOC) and the contractor was sham and bogus, asserting that they were actually employees of IOC. Alternatively, they could plead that if the contract was genuine, the contract labour system should be abolished under Section 10 of the CLRA Act.

2. Respondent's Argument: IOC contended that the appellant could not take contradictory stands. They argued that in the first writ petition, the appellant assumed a valid contract existed and sought abolition of the contract labour system, while in the second petition, the appellant claimed the contract was sham and bogus, which was inconsistent.

3. Court's Analysis: Upon examining the pleadings in both writ petitions, the Court found that the issues, parties, cause of action, and reliefs claimed were different. In the first petition, the relief sought was under the CLRA Act for abolition of the contract labour system and absorption of workers as IOC employees. In the second petition, the relief sought was under the ID Act for making a reference to the Industrial Tribunal to decide if the contract was sham and the workers were direct employees of IOC.

4. Consistency of Stand: The Court noted that even in the first writ petition, the appellant contended that the contract was sham and nominal, and the workers were actually employees of IOC. The High Court erred in assuming that the appellant conceded the contract's validity in the first petition and took a contrary stand in the second petition.

5. Legal Principles: The Court clarified that taking alternative pleas available in law is permissible when there is no inconsistency in the facts alleged. Different or alternative reliefs can be claimed on the same facts. The contention of IOC regarding res judicata or estoppel was rejected.

6. SAIL-II Decision: The Court distinguished the present case from the SAIL-II decision, where inconsistent and mutually destructive pleas were raised in the same proceedings. In the present case, the issues in the two writ petitions were different, and thus, the principle from SAIL-II did not apply.

Re: Question (ii) - Refusal of Reference by Central Government
1. Discretion of Government: The Court acknowledged that making a reference under Section 10(1) of the ID Act is within the discretion of the appropriate government. However, this discretion must be exercised bona fide and based on relevant and material facts.

2. Judicial Review: The Court emphasized that while the adequacy or sufficiency of the material on which the government forms its opinion is beyond judicial scrutiny, the government must not act on irrelevant, irrational, or extraneous grounds, nor should it prejudge or adjudicate the dispute.

3. Case Law: The Court referred to several precedents, including *State of Madras v. C.P. Sarathy*, *Rohtas Industries Ltd. v. S.D. Agarwal*, and *Ram Avtar Sharma v. State of Haryana*, which established that the government should not delve into the merits of the dispute and must provide reasons for its refusal to make a reference.

4. Present Case: The Court found that the central government had examined the merits of the dispute and refused to make the reference on the ground that the workers were not employees of IOC. This was the very issue that required adjudication by the Industrial Tribunal.

5. Mandamus: The Court concluded that a writ of mandamus would be issued to the appropriate government to reconsider the refusal to make a reference when the refusal is based on irrelevant or extraneous grounds or when the government prejudges the dispute.

6. Decision: The appeal was allowed, and the Central Government was directed to reconsider the matter and take an appropriate decision on the request for reference of the dispute to the Industrial adjudicator. The Industrial Tribunal would then consider the dispute on merits, uninfluenced by the observations of the High Court or Supreme Court.

Conclusion:
The Supreme Court allowed the appeal, directing the Central Government to reconsider the request for reference of the dispute to the Industrial Tribunal, emphasizing the need for proper adjudication of the workers' claims regarding their employment status with IOC.

 

 

 

 

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