1969 (2) TMI 80 - SC - Companies Law

Whether in the view that it took that the writ petition was not maintainable against the company the High Court could still grant the said declaration? Held that - Once the writ petition was held to be misconceived on the ground that it could not lie against a company which was neither a statutory company nor one having public duties or responsibilities imposed on it by a statute, no relief by way of a declaration as to invalidity of an impugned agreement between it and its employees could be granted. The High Court, in these circumstances, ought to have left the workmen to resort to the remedy available to them under the Industrial Disputes Act by raising an industrial dispute thereunder. The only course left open to the High Court was therefore to dismiss it. No such declaration against a company registered under the Companies Act and not set up under any statute or having any public duties and responsibilities to perform under such a statute could be issued in writ proceedings in respect of an agreement which was essentially of a private character between it and its workmen. The High Court, therefore, was in error in granting the said declaration. Appeal allowed.

Issues Involved:
1. Validity of the agreement dated December 20, 1963.
2. Existence of an industrial dispute under Section 2(k) of the Industrial Disputes Act, 1947.
3. Legality of the retrenchment of 92 workmen.
4. Appropriate Government for the dispute - Central Government or State Government.
5. Maintainability of the writ petition under Article 226 of the Constitution of India.

Issue-wise Detailed Analysis:

1. Validity of the Agreement Dated December 20, 1963:
The agreement dated December 20, 1963, was challenged on the grounds of collusion between the union and the company and its inconsistency with earlier settlements. The learned single judge found no proof of collusion and held that the union had raised an industrial dispute, leading to the conciliation and the impugned agreement. However, the Division Bench of the High Court held that the agreement was invalid as the earlier settlements were not terminated under Section 19(2) of the Industrial Disputes Act, 1947, and thus, no valid conciliation could occur. The Supreme Court did not delve into the merits of this issue but focused on the maintainability of the writ petition.

2. Existence of an Industrial Dispute Under Section 2(k) of the Industrial Disputes Act, 1947:
The single judge held that the union's letter dated April 5, 1963, raised an industrial dispute regarding retrenchment. However, the Division Bench found that the letter did not raise the issue of retrenchment but only addressed wage structure revisions and other demands. Consequently, the Division Bench concluded that no valid conciliation occurred regarding retrenchment, rendering the impugned agreement invalid. The Supreme Court did not address this issue directly, as it focused on the procedural aspects of the case.

3. Legality of the Retrenchment of 92 Workmen:
The retrenchment was challenged as being in breach of Section 25F of the Industrial Disputes Act, which requires notice to the appropriate Government. The single judge upheld the retrenchment, but the Division Bench found it illegal due to the invalidity of the agreement permitting retrenchment. The Supreme Court did not rule on the legality of the retrenchment, as it centered its judgment on the writ petition's maintainability.

4. Appropriate Government for the Dispute - Central Government or State Government:
The single judge held that the State Government was the appropriate authority, as the company was not an industry run by or under the Union Government. The Division Bench did not contest this finding. The Supreme Court did not address this issue directly, as it was not central to the resolution of the appeal.

5. Maintainability of the Writ Petition Under Article 226 of the Constitution of India:
The Supreme Court upheld the High Court's view that the writ petition under Article 226 was misconceived and not maintainable against the company, as it was a non-statutory body with no public or statutory duty enforceable by mandamus. The Court emphasized that mandamus lies to secure the performance of a public or statutory duty, which was not applicable in this case. The Supreme Court concluded that the High Court erred in granting a declaration in favor of the workmen after holding the writ petition to be misconceived. The Court stated that the workmen should resort to remedies available under the Industrial Disputes Act.

Conclusion:
The Supreme Court allowed the appeal, setting aside the declaration granted by the High Court. The Court held that no relief by way of a declaration could be granted in writ proceedings against a company registered under the Companies Act, which had no statutory or public duties. The workmen were advised to seek remedies under the Industrial Disputes Act. No order as to costs was made.

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