2023 (8) TMI 1498 - HC - Indian Laws

Government cannot refuse Industrial Disputes Act Section 10 reference solely on delay grounds after 24 years

The Rajasthan HC held that the appropriate Government cannot refuse to make a reference under Section 10 of the Industrial Disputes Act, 1947 solely on ... Discretion under Section 10(1) of the Industrial Disputes Act - existence of industrial dispute - delay and laches / stale claim - government not to adjudicate merits - formulation of preliminary issue on delay - moulding of relief by Labour CourtDelay and laches / stale claim - existence of industrial dispute - Whether appropriate Government can refuse to make a Reference under Section 10(1) on the ground of delay and laches or treating the claim as stale. - HELD THAT: - The Court held that mere delay and laches cannot, by themselves, be a ground for the appropriate Government to refuse to make a Reference under Section 10(1). While no statutory limitation is prescribed for making a reference, delay is a relevant factor in deciding whether an industrial dispute 'exists' or has become stale; that factual conclusion affects the Government's power to refer. However, the determination whether a dispute has ceased to exist because of delay is a matter that ordinarily calls for adjudication and may not be finally decided by the Government acting under Section 10(1). The appropriate Government may consider whether the delay has rendered the dispute stale insofar as forming its opinion on existence of a dispute, but it must not act as an adjudicatory body and decide merits attributable to the delay; issues of delay can be framed as preliminary questions for the Labour Court to decide when making the reference. [Paras 28, 29, 30]Delay and laches alone do not permit refusal to refer; the Government may treat delay as relevant to the existence of a dispute but should not finally adjudicate that question and may frame it as a preliminary issue for the Labour Court.Discretion under Section 10(1) of the Industrial Disputes Act - government not to adjudicate merits - formulation of preliminary issue on delay - moulding of relief by Labour Court - Whether the appropriate Government can assume the role of an adjudicating authority while deciding whether to make a Reference. - HELD THAT: - Relying on decisions of the Supreme Court and ensuing principles, the Court reaffirmed that the function of the appropriate Government under Section 10(1) is administrative and not judicial or quasi-judicial; it must form an opinion whether a dispute exists or is apprehended but must not determine the merits of the dispute. If resolution of whether a dispute exists requires detailed examination of evidence (for example, whether delay has rendered the dispute stale), the Government may nevertheless make the reference and simultaneously frame the question of delay/laches as a preliminary issue to be decided by the Labour Court. Separately, reliefs affected by delay (such as back wages) are matters for the Labour Court, which may appropriately mould relief. [Paras 11, 13, 29, 30]The Government must not act as an adjudicating authority; it should apply its mind administratively to existence of dispute and, where appropriate, frame preliminary issues (including delay) for the Labour Court, leaving merits and relief-moulding to adjudication.Final Conclusion: Impugned order dated 19.12.2011 refusing reference is quashed and set aside; the appropriate Government is directed to make a Reference to the Labour Court/Industrial Tribunal, with liberty to frame preliminary issues on delay and laches for adjudication, and the petition is disposed of accordingly. Issues Involved:1. Whether the appropriate Government can refuse to make a Reference under Section 10 of the Industrial Disputes Act, 1947, on the ground of delay and latchesRs.2. Whether the Government can take up the role of Adjudicating Authority while deciding the question as to whether a Reference be made or notRs.Detailed Analysis:Issue 1: Refusal to Make Reference on Grounds of Delay and LatchesThe petitioner challenged the validity of the impugned order dated 19.12.2011, where the appropriate Government refused to make a Reference to the Labour Court due to a 24-year delay in raising the dispute. The petitioner argued that no limitation period is prescribed under the Industrial Disputes Act, 1947, for raising an industrial dispute and seeking a reference. The petitioner cited precedents like Ajaib Singh Vs. Sirhind Co-op. Marketing-Cum-Processing Service Society Limited and Raghubir Singh Vs. General Manager, Haryana Roadways to support this contention.The court reviewed various precedents, noting that no statutory limitation period exists for making a reference under Section 10 of the Act. However, the Government must exercise this power reasonably and not in a mechanical fashion. The court cited judgments such as State of Bombay vs. K.P. Krishnan and others, Bombay Union of Journalists vs. State of Bombay, and Telco Convoy Drivers Mazdoor Sangh vs. State of Bihar to emphasize that while the Government has discretion, it should not adjudicate the dispute's merits.The court referred to the Supreme Court's stance in cases like Nedungadi Bank Ltd. vs. K.P. Madhavankutty and Ors and Sapan Kumar Pandit vs. U.P. State Electricity Board, which held that the Government's power to refer a dispute is coextensive with the dispute's existence. The court also noted that the delay could be relevant in deciding whether the dispute has become stale but should not be the sole ground for refusal.Issue 2: Government's Role as Adjudicating AuthorityThe court held that the Government's role under Section 10(1) of the Act is administrative, not judicial or quasi-judicial. The Government must form an opinion on whether an industrial dispute exists or is apprehended but should not adjudicate the dispute's merits. This principle was supported by judgments like Telco Convoy Drivers Mazdoor Sangh vs. State of Bihar and Rashtriya Chemicals & Fertilizers Ltd. vs. General Employees' Association.The court cited the Larger Bench decision of the Himachal Pradesh High Court in Shri Jai Singh Vs. State of H.P., which outlined that the Government must apply its mind and not act mechanically. The Government can consider delay while forming an opinion but should not refuse to make a reference solely on this ground. The court emphasized that the Labour Court should adjudicate the merits of the dispute, including any issues of delay and latches.ConclusionThe court quashed the impugned order, directing the Government to make a Reference of the dispute. The court clarified that delay and latches could be grounds for the Labour Court to refuse relief or back wages but not for the Government to refuse making a reference. The court suggested that the Government could formulate the question of delay and latches as a preliminary issue for the Labour Court to decide.Final JudgmentThe impugned order was quashed, and the Government was directed to make a Reference of the dispute. The petition was disposed of with these directions.