Industrial award binding on successor corporation; jurisdictional and collusion challenges fail, and delayed wages carry interest.

A valid industrial award, once published and enforceable, continued to bind the successor Municipal Corporation after municipal merger and could not be displaced by a transfer notification or local non obstante clause. The challenge based on jurisdiction, non-joinder and alleged collusion failed because the Tribunal had jurisdiction, the corporation was not a necessary party to the original reference, and the collusion plea lacked concrete support. The workmen were also entitled to interest on delayed wages and monetary benefits on equitable principles, with the Court directing a reduced rate of 15% per annum until payment.

---

---

Issues: (i) whether the award passed by the Industrial Tribunal before the municipal merger bound the successor Municipal Corporation and could not be neutralised by the transfer notification issued under the municipal law; (ii) whether the award could be impeached on the grounds of want of jurisdiction, non-joinder of the Corporation, or alleged collusion; and (iii) whether workmen were entitled to interest on delayed payment of wages and monetary benefits.

Issue (i): whether the award passed by the Industrial Tribunal before the municipal merger bound the successor Municipal Corporation and could not be neutralised by the transfer notification issued under the municipal law.

Analysis: The award was passed by a duly constituted Industrial Tribunal on a valid reference under the Industrial Disputes Act, 1947 and, once published, became final and enforceable. The municipal merger notification and the non obstante clause in the local statute could not be construed to suspend, override, or temporarily repeal the operation of a Central statute or to nullify an award rendered by a competent Tribunal. The Corporation became the successor of the erstwhile municipality, and the binding force of the award followed the establishment by operation of Section 18(3)(c) of the Industrial Disputes Act, 1947. The terms of the award also operated from an earlier date, so the employees' status on the relevant date was already governed by that award.

Conclusion: The award bound the respondent Corporation, and the Corporation was not entitled to disregard it or alter the employees' status contrary to the award.

Issue (ii): whether the award could be impeached on the grounds of want of jurisdiction, non-joinder of the Corporation, or alleged collusion.

Analysis: The Tribunal had jurisdiction to decide the reference, and the mere fact that the award was made during the period between the draft and final municipal notifications did not render it a nullity. The Corporation was not a necessary party to the original reference because the dispute was between the workmen and the erstwhile municipality, and effective adjudication was possible without the Corporation being joined. The allegations of collusion were found to be vague and unsupported by concrete material; the settlement was placed before the Tribunal in an open proceeding, accepted as reasonable, and then converted into an award. A properly made judicial or quasi-judicial determination cannot be set aside in collateral proceedings on such unsubstantiated grounds.

Conclusion: The challenge based on nullity, non-joinder, and collusion failed.

Issue (iii): whether workmen were entitled to interest on delayed payment of wages and monetary benefits.

Analysis: Wages are the price of labour and timely payment is an integral part of the employment relationship. Where wages or monetary benefits are wrongfully delayed, interest can be claimed on equitable principles and by implication of the employment contract, unless the delay is attributable to the workmen. The Court declined to grant the full rate claimed, but held that a reasonable rate of interest was payable on the delayed sums until actual payment.

Conclusion: Interest on delayed wages and monetary benefits was payable, though at a reduced rate of 15% per annum.

Final Conclusion: The petitions succeeded. The municipal successor was required to implement the earlier industrial award, the employees were entitled to the service and pay benefits flowing from that award, and delayed monetary dues carried interest at the rate directed by the Court.

Ratio Decidendi: A valid industrial award, once final and enforceable, binds the successor of the undertaking and cannot be neutralised by a transfer notification under a local statute; delayed wage liabilities carry an implied obligation of interest.

---