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DAMODARAM SANJIVAYYA
NATIONAL LAW UNIVERSITY

SABBAVARAM, VISAKHAPATNAM, A.P., INDIA

NAME OF THE PROJECT:

TRADE UNIONISM: CURRENT POSITION

SUBJECT:
LABOUR LAW

NAME OF THE FACULTY:

Mr. R. Bharat Kumar

NAME OF THE STUDENT:

P.RAJ KUMAR

ROLL NO:
18LLB068

SEMESTER V
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Trade Unionism: Current Position

1. Introduction

The labour movement was the key factor translating suffering and desperation into optimism
and change. Economic and social change gave rise to unemployment benefits, old-age
savings, government aid for the destitute and, above all, new income standards that implied
not just subsistence but tolerable existence. Industry captains didn't lead this transformation;
they fought it until it was conquered. When the union organisation surge crested the country
in the thirties, it took not only itself, but the entire community, to safe shores.

Martin Luther King.

Overall, labour unions formed as a consequence of the Industrial Movement and can be dated
back to the 18th century when the Industrial Revolution started in Britain. Industrial
Revolution is marked by large-scale manufacturing, modern mass production lines,
mechanisation and accelerated economic growth. Naturally, where a large number of
factories are set up, labour is required. The need for unskilled and qualified labour increased.
At the moment, companies were not well regulated, and workers focused on maximising
income that contributed to the abuse of the uneducated and disadvantaged labour-class. In
other terms, two groups were created in the industrial sector:

Employer Class – That was profit-oriented and did not even care with labour standards.

Labor Class—who were uneducated and had little awareness of their rights, and still required
capital.

Initially, the labourers believed they wanted more income and their employers could quickly
substitute them if they complained against the exploitative conditions and salaries levied by
their employers.

But eventually the labour-class discovered that if one person labour-class protested against
his employee's exploitative conditions, it would have little effect on the industrial
organisation, but if labourers create a collective or "union," then more impact would be
exercised on their employer-lords. Forming labourers into unions often granted them the right
to contract jointly. This idea contributed to Labor Unions being created.
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The observation of the 26th U.S. President is noteworthy to mention here as follows: "It is
necessary that there should be a labour union. It's an organisational era. Capital organises and
so labour must organise."

2. Trade Unionism in India

The British began colonising the Indian sub-continent in the 1600s and set up factories and
mills in India much as the British Technological Revolution. The key factor the British
considered it appropriate to initiate industrialization in India was because India had a surplus
of inexpensive and poor labour, coupled with natural capital and land to set up factories.

The cotton mill was founded in Bombay, 1851, and the first jute mill was established in
Bengal, 1855. Like Britain, Indian working practises were worse. The exploitative and
pitiable working standards such as working hours, salaries and expelling policies rendered the
labours link hands, organise and demonstrate. One of the first discontent among labourers can
be traced back to 1877, when the Empress Mill labourers formed a strike owing to a sudden
reduction in salaries.

Because such unionism was a modern development, no legislation existed to legalise and
control these new trade unions. With the dissatisfaction and agitation in the labour-class and
frequent tiffing with the employer-class, few measures were taken to examine and address the
crisis.

Factories Commission, 1875 – Factories Commission, 1875 was the first commission set up
to thoroughly examine the factory conditions and come to the decision that some sort of
legislative cap was required and the Factories Act, 1881 passed.

Factories Commission, 1885 – The Second Commission was formed in 1885 and passed in
1891 based on the investigation and the Second Factories Act.

Royal Labor Council, 1892 – The Commission placed limits on working hours in factories.

Factories Committees and Factories regulations did not affect any change in the living
standards of the Indian working class. In 1885, all Indian employees signed a memorandum
with their bosses to provide them with basic minimum working standards. However, the
condition has not changed.

The labourers' initial strategy was humanistic in nature under the setting-up of Mahatma
Gandhi's Indian National Congress and non-violence campaign.
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3. Period Post 1947

One major lacuna with the 1926 Act was that though it provided for voluntary registration of
Trade Unions it did not provide for compulsory recognition of the Trade Unions by the
employers and because it was not compulsory for the employers to recognize the Trade
Unions, obviously did not recognize them. This again put a halt to the development of Trade
unions.

For example, whenever the members of Trade Unions or their lawyers went to negotiate with
the employers, the employers simply refused to talk to them on the ground that they do not
recognize such Trade union, though it is registered!

The Act was amended in 1947 which provided for compulsory recognition by the employers
of the representative Unions. However, the amended act has not been brought to force yet.

4. Trade Unionism in India from 1950 to 1970

India's independence was of immense value to Labor Unions in India as ancestors followed
the ideals of dignity for everyone, fairness and democracy, including freedom of speech.
India's Constitution has acknowledged freedom of association as a constitutional right.

India has embraced preparation through Five-Year Plans. The first two five-year programmes
centred on manufacturing and agriculture, which contributed to the development of major
public-sector industries. With the establishment of factories, the demand for labour increased
and unionism became active.

The unions, though, had their own difficulties. Owing to lack of coordination and proper
leadership, there were inter-union disputes and disagreements combined with political
interventions. The state adopted a paternalistic stance by dictating unions. Thus, in this time,
strikes and demonstrations were low compared to the coming years.

5. Trade Unionism in India from 1970 to 1990

From mid-1960, India's economic condition had begun to deteriorate mostly due to famines
and wars experienced by India in its preceding years. Inflation increases, food and crop costs
soared. Structural economic developments have impacted sectors. Trade unions orchestrated
further marches, demonstrations, and lockouts during this time.
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Both Human Rights, including the freedom to join unions and the right to strike, were
revoked under the PM Indira Gandhi regime from 1975 to 1977.

By this time, the unions had attained a commanding role. They behaved with their diplomatic
capacities, becoming more united and became willing to satisfy their demands through
agreements and strikes.

6. Trade Unionism in India, 1990-1999

The government agreed to open the economy in 1991 by implementing the "New Economic
Policy" (NEP). In Trade Unions in India, too, with liberalisation stresses, privatisation and
globalisation breaks and splits were seen as the government's labor-friendly stance shifted to
be more investor-friendly. Because of globalisation, the population was dramatically cut, and
labour unions were working desperately to save labourer jobs. With liberalisation in 1991,
legislation on industrial relations started to shift. Now the approach was tilted to workers.
Employers opted for staff cuts, implemented early retirement programmes initiatives, and
improved job versatility. The age-old protectionism approach proved insufficient for the
Indian industry to stay successful, as lack of flexibility presented a significant challenge to
producers as they had to compete on the foreign market.

7. 21st-century trade-unionism

With NEP experiencing challenges, labour unions have endured a barrage of issues, but the
bright lining is the increase in the number of trade unions, stronger organisation and working.
According to Labor Bureau statistics, India has around 11,556 registered labour unions with
an average membership of 1283 members per union. The Act was revised in 2001.
Significant additions and amendments are as follows:

Amendment to Section 4.: The proviso to Section 4, introduced since the 2001 amendment,
also prescribes minimum number of employees to be member of the Labor Union while
applying for membership. The proviso reads, 'Provided that no Trade Union of Employees
shall be recognised until, on the date of application for registration, at least ten percent of one
hundred workers, whichever is less, engaged or working in the institution or business for
which it is associated, are representatives of that Trade Union:

Furthermore, no Labor Union of Employees shall be licenced until, on the date of application,
it has as members no fewer than seven individuals engaged or working in the institution or
business with which it is associated."
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Section 9A: Minimum participation criteria was defined by incorporating Section 9A into the
Act.

1. B.C. Sharma & Another v. M.L. Bhalla & Others [AIR 2006 SC

3293]

Facts:

 This appeal concerns the holding of the next trade union referendum, the Uttariya
Railway Mazdoor Union, registered under the Trade Union Act, 1926 (hereinafter
mentioned as "the Union"). Its representatives come from the Northern Railways and
are governed by a Central Executive Committee under a properly registered
Constitution. The Common Body is Union's supreme body.
 Under clause 1 of the Union's Constitutional Rules and Byelaws, 'General Body'
consists of Union office-bearers and representatives of the Central Executive
Committee and delegates elected in the specified manner as defined below. Clause 6
discusses Union priorities and objects.

Issues:

Whether it is not practicable to arrange for a General Meeting to be convened for discussion
and disposal of any definite issue the point may be referred to all the members of the Union
for balloting in the manner hereinafter prescribed.

Observations made by the Court:

 The General Body shall consist of:-

a) Office-bearers and members of the Central Council.

b) Delegates elected by the members in each Branch of the Union at a meeting held for the
purpose on the basis of one delegate for every 150 members of major part thereof, shall
comprise of:-

i) The General Body meeting will be held in every three years.

ii) Any other extra General Body meeting will be held after three years.

The relevant rules are as under:

The General Body shall consist of:-

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a) Office-bearers and members of the Central Council.

b) Delegates elected by the members in each Branch of the Union at a meeting held for the
purpose on the basis of one delegate for every 150 members of major part thereof, shall
comprise of:-

i) The General Body meeting will be held in every three years.

ii) Any other extra General Body meeting will be held after three years.

 Where it is not practicable to arrange for a General Meeting to be convened for

discussion and disposal of any definite issue the point may be referred to all the
members of the Union for balloting in the manner hereinafter prescribed. Any
question relating to cessation of work should variably be submitted for balloting.
 Working Committee.

There shall be a Working Committee comprising of the Central Office bearers and 170
members selected by Central Council from among the Central Council members. This
number of 140 can be revised by the Central Council from time to time.

 Business at the General Body Meeting.

 The business to be transacted at the General Body Meeting shall ordinarily be:-

a) To adopt General Secretary Report.

b) To pass the Audited Accounts and balance sheet of the Union.

c) To elect the office bearers of the General Council.

d) To appoint an Auditor in accordance with the Act or any regulation made thereunder and
to fix his remuneration.

e) To transact such other business as may be laid before it by the Subject Committee.

f) The elected office bearers will continue functioning till new elections are held or for
another period of six months which ever is earlier."

 The reason therefor is that the appellants should not be allowed to continue to
function in the manner as they are doing, i.e., despite expiry of the tenure and under
the interim order passed by the learned trial court. It is difficult to understand as to
why the preparation of electoral roll could not be finalised.
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 If the office-bearers are interested in carrying out their trade union activities although,
they are entitled to contest the elections but should have at least agreed to finalisation
of Electoral College. The appellants having been elected for a definite term, it was
their solemn duty to see that elections are held before their tenure comes to an end.
 We are not unmindful of the fact that the expiry of tenure by itself may not lead to the
conclusion that continuation of the office-bearers in the office per se would be illegal.
In the instant case, the appellants are continuing in office because of the interim order
passed by a court of law, which is per se unsustainable.
 Elections of 20 branches have already been completed and elections of 35 branches
are in the pipeline. The elections of those branches, which have not yet been
completed, should also be completed immediately. Any dispute or difference in
regard to the list of voters would also be determined by the Registrar of Trade Union.
 The main purpose of the Trade Union is to have negotiations with the Railway
Administration as regards the demands of the employees. We hope and trust that the
interests of the workmen would not suffer because of this order. We would request the
competent authorities of the Northern Railway Administration not to, unless exigency
of the situation arises, take any decision in this behalf.

Decision of the Court:

The Supreme Court dismissed the appeal as the main purpose of the Trade Union is to have
negotiations with the Railway Administration as regards the demands of the employees. We
hope and trust that the interests of the workmen would not suffer because of this order.

2. Punjab National Bank vs. Their Workmen [AIR 1960 SC 160]

Facts:
 The employees of the appellant Bank commenced pen-down strikes, which were
followed by a general strike, pending arbitration of an industrial dispute between
them. The Government of India intervened and as the result of an agreement that
followed the Bank reinstated all the employees except 150, against whom it
had positive objections, and the Government referred their cases under s. 10 of the
Industrial Disputes Act, 1047, to the Industrial Tribunal for adjudication.
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 The two issues before the Industrial Tribunal were whether the 150 employees had
been wrongly dismissed and what wages and allowances would the employees be
entitled to on reinstatement. The case of the employees was that the Bank wanted to
penalise the active trade union workers by the said dismissals while the Bank
maintained that the employees were guilty of participation in illegal strikes
intended to paralyse its business and scare away its customers.
 The Industrial Tribunal did not hear evidence and, by its final award, held that, the
strikes being illegal, the Bank was, on that ground alone, justified in dismissing the
employees. Even so, it directed the Bank to make certain payments to the
employees on compassionate grounds. The Bank as well as the employees
appealed. The Labour Appellate Tribunal held that even though the strikes
were illegal under s. 23(b) read with s. 24(1) of the Industrial Disputes Act, 1947, the
Bank had, by entering into the agreement with the Government of India, waived its
right to take penal action against the employees for joining the illegal strikes and
that, therefore, an enquiry should be held on additional evidence to decide the
disputes on merits.
 Against this interlocutory order the Bank appealed to this Court and it was held
bythe Court that while the strikes were no doubt illegal under s. 23(b) of the Act, the
orders of dismissal passed by the Bank were no less so under s. 33 of the Act, and it
dismissed the appeal. The Appellate Tribunal, thereafter, heard the cases on merits,
directed-the reinstatement of 136 of the said employees, but refused to reinstate the
rest whom it found guilty of issuing posters and circulars subversive of the credit
of the Bank.
 Both the parties appealed to the Court. Preliminary objections were raised on behalf
of the said employees that, (1) in view of the decision of this Court dismissing
the Bank's appeal against the said interlocutory order the subsequent inquiry by the
Tribunal and the orders of dismissal must be held to be void and, (2) no charges
having been admittedly framed nor any proper enquiry held by the Bank against
the employees, the orders of dismissal were wholly invalid.
 It was urged, inter alia, on behalf of the Bank in the appeals that participation in a
pen-down strike by itself amounted to misconduct sufficient to disentitle an
employee to reinstatement and that the entire body of strikers, being collectively
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responsible for the publication of the subversive documents in question, the dismissed
employees could by no means escape liability.

Issues:

1. Whether an employer has the right to dismiss a workman for his absence from duty by
reason of his mere participation in an illegal strike.

2. Whether the 150 workmen had been wrongfully dismissed by the Bank.

Observations made by the court:

 It cannot be stated as a general proposition that participation in an illegal strike would

by itself necessarily involve the penalty of dismissal.
 The Bank relied upon several documents to show that the employees were guilty of
subversive actions during the course of the strike. The appellate tribunal was not
satisfied that these documents were genuine and could be effectively pressed into
service by the Bank in support of its case. It was also urged by the Bank that during
the course of the strike posters and circulars were issued which were clearly
subversive of the credit of the Bank and it was contended that employees who were
guilty of issuing such posters and circulars did not deserve reinstatement. The
appellate tribunal examined these documents and held that three of them amounted to
subversive acts.
 In an enquiry under s. 33A the employee would not succeed in obtaining an order of
reinstatement merely by proving contravention of s. 33 by the employer. After such
contravention is proved it would still be open to the employer to justify the impugned
dismissal on the merits.
 The court cited the Full Bench of the Labour Appellate Tribunal in Buckingham &
Carnatic Mills Ltd., And Their Workmen [1951] 11 L.L.J. 314, "in so ordering the
tribunal is expected to be inspired by a sense of fairplay towards the employee on the
one hand and considerations of discipline in the concern on the other. The past record
of the employee, the nature of his alleged present lapse and the ground on which the
order of the management is set aside are also relevant factors for consideration." and
found that no hard and fast rule can be laid down in dealing with this problem.
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 The Bank has not held any enquiry it cannot obviously contend before the tribunal
that it has bona fide exercised the managerial functions and authority in passing the
orders of dismissal and that the tribunal should be slow to interfere with the said
orders.

Decision of the Court:

The court reinstated the employees and upheld the decision of the labour court and dismissed
the appeal.

3. Indian Oxygen Ltd v. Their Workmen [AIR 1969 SC 306]

Facts:

 The appellant company is an all India complex having establishments in different

parts of the country. Certain disputes having arisen between the appellant company
and its workmen employed in the factory at Jamshedpur, the company and the said
workmen represented by their union called the Indoxco Labour Union, Jamshedpur,
made a joint application dated September 7, 1963 to the Government of Bihar for a
reference under Sec. 10 (2) of the Industrial Disputes Act, 1947.
 By a notification dated October 23, 1963, the Government referred five disputes to the
Tribunal for adjudication. the said application and the statement signed by the parties,
(1) that the said disputes concerned the 352 workmen employed in the company's
factory at Jamshedpur and (2) that these 352 workmen were represented by the
Indoxco Labour Union.
 The notification also stated: "Whereas the Governor of Bihar is of opinion that an
industrial dispute exists or is apprehended between the management of Indian Oxygen
Limited, Jamshedpur-7 and their workmen represented by Indoxco Labour Union,
Jamshedpur, regarding the matters specified in their joint applications dated 7-9-1963.
 Industrial Tribunal awarded 11/4 times ordinary wages for overtime work and
awarded special leave to union's representatives to attend meetings of executive
committee of union.

Issue:
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1. Whether, Tribunal was justified in obliged Appellant company to grant special

leave.

Observations made by the Court:

 Tribunal obliged Appellant company to allowing of its workmen to grant special leave
to attend without loss of pay proceedings before conciliation officers and industrial
Tribunals.
 However, in awarding this demand, Tribunal did not specify on how many occasions
executive committee meetings and other meetings would be held and when company
would be obliged to give special leave with pay to union's representatives.
 Further, Tribunal could not specify or limit number of meetings for such attempt
would amount to interference in administration of union.
 Moreover, demand for special leave had created absenteeism harms both employers
and employees inasmuch as it saps industrial economy.
 Therefore, Tribunal was not justified in obliged Appellant company to grant special
leave demanded by union - Hence, except for overtime rate, other award of Tribunal
was set aside.

Decision of the Court:

Tribunal was not justified in obliged Appellant company to grant special leave demanded by
union. Except for overtime rate, other award of Tribunal was set aside. Appeal was partly
allowed.

Ratio Decidendi:

Industrial adjudication endeavors to resolve conflicting claims of employers and employees

by finding fair and just solution.

4. Crompton Greaves Limited v. Workmen Crompton Greaves Limited

v. Workmen [AIR 1978 SC 1489]

Facts:
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 On December 27, 1967, the appellant, M/s. Crompton Greaves Ltd., Calcutta,
(hereinafter referred to as 'the Company'), an engineering company engaged in the
manufacture and sale of electrical products such as motor fan control gears,
transformers and other electrical instruments, with its registered office in Bombay and
offices in several locations in India, told Greaves Cotton and Crompton Parkinston
Associate Conc.

 The Union sought intervention in the matter of the Labour Commissioner,

apprehending mass retrenchment of the workers who numbered 353. Subsequently, in
his office, the Assistant Labour Commissioner held joint conferences between
members of the union and the corporation to discuss means of conciliation and
pleasant resolution. Consequently, two conferences were held on 5 and 9 January
1968, in which both sides took part. As a result of these conferences, on the morning
of 10 January 1968, the organization decided to hold a bipartite meeting with the
members of the union at its office in Calcutta to identify the possibility of an agreed
solution.

 The presentation, as decided, took place on the morning of January 10, 1968, but no
agreement could be reached. Whereas, according to the union, the management of the
company was not serious about reaching a negotiated settlement and merely showed,
according to the management of the company, that the unseemly and recalcitrant
conduct adopted by the union during the meeting led them to conclude that the union
was not involved in any successful agreement.

 However, through another joint meeting, scheduled for January 12, 1968, the
Assistant Labour Commissioner managed to use his good offices to bring about a
pleasant settlement. On the afternoon of 10 January 1968, the company hung up a
notice retrenching 93 of its workmen belonging to the Calcutta Office without telling
the Labour Commissioner that it was implementing its planned retrenchment plan.

 The staff resorted to strike with effect from 11 January 1968 after giving notice to the
appellant and the Labour Directorate and continued the same until 26 June 1968,
considering the measure taken by the company as reasonably extreme requiring
urgent attention and immediate action.
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 In the meantime, the industrial dispute was referred to the Industrial Tribunal by the
State Government on 1 March 1968 in relation to the reason of the aforementioned
reduction. The State Government subsequently vacated its order No. 8890-
I.R./I/IOL/79/67 of 13 December 1968 and referred to the Industrial Tribunal for
adjudication the issue of the right of employees to salaries for the strike duration from
11 January 1968 to 26 June 1968. "the redress for retrenchment having been sought
by the union itself through the Tribunal, there remained no justification for the
workmen to continue the strike"the remedy for retrenchment had been sought by the
union itself through the Tribunal, there was no justification for it.

 Consequently, the scope of the appeal was limited to the creation, for the duration
starting on 11 January 1968 and ending on 29 February 1968, of a brief issue
concerning the right or otherwise of the striking workers to salaries.

Issues:

1. Whether the aforesaid strike was illegal or unjustified ?

2. Whether the workmen resorted to force or violence during the portion of the strike period
commencing from January 11, 1968 and ending with February 29, 1968 ?

Observations made by the Court:

 The court observed that, it is well-settled that the strike should be legal as well as
justified in order to entitle employees to salaries for the strike duration. If it does not
breach any clause of the statue, a strike is legal.

 Again, unless the motives for it are absolutely perverse or unfair, a strike cannot be
said to be unjustified. Whether or not a specific strike was justified is a matter of each
case's factual circumstances.
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 It is also well-settled that they are disentitled to wages for the strike duration by the
use of force or abuse or acts of sabotage resorted to by the workers during a strike.

 The Tribunal has held that it has not been proved that the workmen resorted to force
and violence during the period in question. The Supreme Court too found the same.

 No specific provision of law was brought to the notice on behalf of the appellant
which rendered the strike illegal during the period under consideration.

 The Court observed that a strike cannot also be said to be unjustified as before the
conclusion of the talks for conciliation which were going on through the
instrumentality of Assistant Labour Commissioner, the company retrenched as many
as 93 of its workmen without even intimating to the Labour Commissioner that it was
carrying out its proposed plan of effecting retrenchment of the workmen.

Decision of the Court:

The Supreme Court affirmed the judgement of the Labour Court and dismissed the appeal.

5 . State Of Mizoram v. Mizoram Engg Service Assocn [(2004) 6

SCC 218]

Facts:

 The Mizoram Engineering Service Association (respondent) has been demanding

higher pay scales for the members. The background is that prior to 1971 what is now
known as the State of Mizoram.
 On the recommendation of the said Departmental Pay Committee, the Government of
India revised the scales of pay and allowances for the employees of the State of
Mizoram w.e.f. 1.1.1973. On a demand made by Superintending and Executive
Engineers of the respondent Association for equalizing their respective scales of pay
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with their counterparts in the Central Public Works Department, the Government of
India vide letter dated 16.10.1983.
 The Government of India accepted the Fourth Central Pay Commission Report
regarding revision of pay scales for Group A, B, C, D & E posts in the Central Civil
Services w.e.f. 1.1.1986.
 Certain representations were made on behalf of employees for removal of anomalies
resulting from the Fourth Central Pay Commission Report. In 1987 an Anomalies
Committee was appointed to look into the alleged anomalies and make suitable
recommendations. The recommendations of the Anomalies Committee created further
anomalies rather than resolving them.
 On 7th November, 1988 another Anomalies Committee was appointed. The report of
the Anomalies Committee was accepted by the Government of the State of Mizoram.
Soon thereafter the State Government issued another notification dated 3rd February,
1989 (the impugned notification) to the effect that the scales of pay for Group 'A'
officers as mentioned in paras 28 of Schedule A and Schedule B did not include pay
scales for MCS officers/MPS officers whose pay scales were governed by their
respective service rules. The notification further excluded engineering officers of the
rank of Executive Engineer and Superintending Engineer from the benefits of the
notification dated 19th January, 1989.

Issues:

Whether Civil Service is Trade Unionism.

Observations made by the Court:

 The failure of the State Government to frame recruitment rules and bring Engineering
Service within the framework of organized service, the engineers cannot be made to
suffer. Apart from the reason of absence of recruitment rules for the Engineering
Service, we see hardly any difference in organized and unorganized service so far as
Government service is concerned in Government service such a distinction does not
appear to have any relevance. Civil Service is not trade unionism.
 This argument fails to appreciate what is sought to be conveyed by use of the words
'organised service' and 'unorganised service'. Nothing has been pointed out in this
behalf. The argument is wholly misconceived.
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 The Chief Engineers, the State Government will have to allow the same scale to other
heads of departments in the service of the State Government which will be a heavy
burden on the financial resources of the State Government and for that reason we
should restrict the scale for post of Chief Engineer and Additional Chief Engineer.
 The Central Government as well as the State Government accepted the
recommendations of the Fourth Central Pay Commission and the scales being allowed
to the members of the respondent Association are based on those recommendations.

Decision of the Court:

The Supreme Court dismissed the appeal and warranted no intereference to the order of the
High Court.

6. Syndicate Bank and Ors. vs. K. Umesh Nayak [(1994) 5 SCC 572]

Facts:

 On 10 April 1989, a memorandum of settlement was signed by the Indian Banks’

Association and the All Indian Bank Employees’ Unions including the National
Confederation of Bank Employees as the fifth bipartite settlement. The appellant
Bank through its employee federation was bound by the said settlement.
 Three separate settlements were entered into between the appellant bank and its
employee federation on 9 June 1989. Under these settlements, the employees of the
appellant were entitled to certain advantages except for those provided under the
Bipartite Settlement.
 However, the appellant bank did not immediately implement the settlement because
of which the employee Federation had to send a telex message to the appellant on 22
June 1989 calling upon it to implement the same without further loss of time or else
an agitation would be launched for its implementation.
 The bank replied that it needs the government’s approval to implement the said
settlement and it is making efforts to obtain the same and hence the federation should
cooperate with it.
 On 24 July 1989, the federation again made the same request to the appellant only this
time with a threat of a token strike. The response of the appellant was the same as
earlier.
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 On 1 September 1989, the Federation issued a notice of the strike, to be held on three
different days beginning from 18 September 1989, demanding immediate
implementation of all agreements/ understandings reached between the parties. At this
stage, Deputy Chief Labor Commissioner and Conciliatory Officer took cognizance
of the dispute and initiated conciliatory proceedings to resolve the same.
 While the proceedings were pending, the employee federation on 6 October 1989
filed a writ petition before the High Court for the immediate implementation of the
three settlements dated 9 June 1989. In the petition, the court ordered the immediate
implementation of the settlement agreed between the parties.
 On 12 October 1989 the Bank issued a circular stating therein that if the employees
went ahead with the strike on 16 October 1989, the Management of the Bank would
deduct the salary for the days the employees would be on strike.
 In spite of the circular, the employees went on strike on 16 October 1989 and on 17
October 1989, wrote a letter to the conciliatory officer requesting him to deem the
proceedings to be closed from their side and filed a writ petition on 7 November 1989
to quash the circular of 12 October 1989 and to direct the Bank not to make any
deduction of salary for the day of the strike.
 The writ petition was admitted and the High Court issued an interim injunction
restraining the bank from deducting the salary. As the arguments advanced the
learned Single Judge ruled in the favor of the Bank while when the matter went in
appeal to the Division Bench it overruled the judgment given by the Single Judge and
ruled in the favor of the employees. It is because of these two conflicting the said
appeal has been filed and the matter has been referred to this court.

Issues:

1. Whether workmen who proceed on legal or illegal strike entitled to wages for period of
strike.

Observations made by the Court:

 The Appellant contended that since under the provisions of sub-section (1)(d) of
Section 22 of the Industrial Disputes Act, the employees were prohibited from
resorting to strike during the pendency of the conciliation proceedings and for seven
days after the conclusion of such proceedings, and since admittedly the conciliation
 P a g e | 19

proceedings were pending to resolve an industrial dispute between the parties, the
strike in question was illegal.
 The industrial dispute had arisen because while the Bank was required to require the
approval of the Central Government for the settlements in question, the contention of
the staff was that no such approval was necessary and there was no such condition
incorporated within the settlements. This being an industrial dispute within the
meaning of the Act, the conciliation proceedings were validly pending on the date of
the strike.
 The Respondent contended that there could be no valid conciliation proceedings as
there was no industrial dispute. The settlements were already arrived at between the
parties solemnly and there could be no further industrial dispute with regard to their
implementation. Hence, the conciliation proceedings were non est. The provisions of
Section 22(1)(d) did not, therefore, come into play.

Decision of the Court:

For payments of wages, the strike must be legal and proper. Since the Industrial Disputes Act,
1947 provides a proper procedure for the resolution of an Industrial Dispute, the Supreme
Court is not the proper authority to decide whether the strike is illegal or not and the proper
forum for deciding this issue is the adjudicator under the Industrial Disputes Act, 1947.

7 Competition Commission Of India v. Co-Ordination Committee Of

Artists And Technicians Of W B Film And Television [AIR 2017 SC
1449]

Facts:

 Mr. Sajjan Kumar Khaitan, is the proprietor of M/s. Hart Video having his
establishment in Kolkata. He is in the business of distributing video cinematographic
TV serials and telecasting regional serials in the States of Eastern India, which
includes the State of West Bengal. M/s. BRTV, Mumbai, which is the producer of
 P a g e | 20

T.V. programmes, had produced T.V. Serial named 'Mahabharat', original version
whereof was in Hindi.
 An advertisement was placed in Daily Newspapers on 19th February, 2011 informing
the public at large that serial 'Mahabharat' would be telecast in Bangla on Channel 10
at 10.00 a.m. in the morning and on CTVN+ at 10.00 p.m. every Sunday.
 Certain producers in Eastern India have formed an association called Eastern India
Motion Picture Association (for short, 'EIMPA'). Likewise, the artists and technicians
of film and television industry in West Bengal have formed an association known as
'Committee of Artists and Technicians of West Bengal Film and Television Investors
(hereinafter referred to as the 'Coordination Committee').
 In their perception, serials produced in other languages and shown on the T.V.
Channels after dubbing them in Bangla would affect the producers of that origin and,
in turn, would also adversely affect the artists and technicians working in West
Bengal. The apprehension was that it may deter production of such serials in Bangla
because of the entry of serials produced in other languages and shown to the public
by dubbing the same in their language.
 When Mr. Sajjan Khaitan (Respondent No. 2), Proprietor of M/s. Hart Video, came
to know of the aforesaid developments and the threat extended to CTVN+ and
Channel 10 and found that these two television channels were going to succumb to
those pressure.
 The CCI, after receiving the aforesaid information from the informant formed a
prima facie opinion that acts on the part of EIMPA and Coordination Committee
were anti-competitive. Accordingly, matter was assigned to the Director General
(DG) for detailed investigation as per the procedure prescribed in the Act. On
investigation, the DG found that the details contained in the information supplied by
the informant were factually correct.

Issue:

1. Whether some of the members are found to be in the production, distribution or

exhibition line, the matter could not have been brushed aside by merely giving it a
cloak of trade unionism.

Observations made by the Court:

 P a g e | 21

 From the bare reading of the aforesaid provision, sub-section (1) of Section 3 puts an
embargo on an enterprise or association of enterprises or person or association of
persons from entering into any agreement in respect of production, supply,
distribution, storage, acquisition or control of goods or provisions of services which
causes or is likely to cause an appreciable adverse effect on competition within India.
 Thus, agreements in respect of distribution or provisions of services, if they have
adverse effect on competition, are prohibited and treated as void by virtue of sub-
section (2). Sub-section (3), with which we are directly concerned, stipulates four
kinds of agreements which are presumed to have appreciable adverse effect on
competition. Therefore, if a particular agreement comes in any of the said categories,
it is per se treated as adversely effecting the competition to an appreciable extent and
comes within the mischief of sub-section (1). There is no further need to have actual
proof as to whether it has caused appreciable effect on competition.
 Proviso thereto, however, exempts certain kinds of agreements, meaning thereby if a
particular case falls under the proviso, then such a presumption would not be
applicable.
 The Coordination Committee, which is a trade union acting by itself, and without
conjunction with any other, would not be treated as an `enterprise' or the kind of
'association of persons' described in Section 3. A trade union acts as on behalf of its
members in collective bargaining and is not engaged in economic activity. In such
circumstances, had the Coordination Committee acted only as trade unionists, things
would have been different. Then, perhaps, the view taken by the Tribunal could be
sustained. However, what is lost in translation by the Tribunal i.e. in applying the
aforesaid principle of the activity of the trade union, is a very pertinent and significant
fact, which was taken note of by the DG as well as the CCI in its majority opinion.
 When some of the members are found to be in the production, distribution or
exhibition line, the matter could not have been brushed aside by merely giving it a
cloak of trade unionism. For this reason, the argument predicated on the right of trade
union under Article 19, as professed by the Coordination Committee, is also not
available.
 prohibition on the exhibition of dubbed serial on the television prevented the
competing parties in pursuing their commercial activities. Thus, the CCI rightly
 P a g e | 22

observed that the protection in the name of the language goes against the interest of
the competition, depriving the consumers of exercising their choice.

Decision of the Court: The Court upheld the decision of the CCI as probhibition of
exhibition of dubbed serials prevented competing parties in pursuing economic activities.

8 Jay engineering works vs state of west Bengal [AIR 1968 Cal 407]

Facts:

 The petitioner No. 1 is a limited company, known as the Jay Engineering Works. Its
principal business consists of the manufacture of Sewing machines and fans. It has a
sales office known as the 'Eastern India Usha Corporation' at No. 26 R.N. Mukherjee
Road in Calcutta. The said office employs, apart from the management staff,
approximately 365 workmen.
 The respondent No. 8, the Jay Engineering Workers Union is registered under the
Trade Unions Act, 1926. The respondent No. 17 Raghunath Kushan is the executive
member of the said union, while the respondents Nos. 9 to 16 and 18 to 28 are
members of the said union. On or about 17th January, 1967, 18 employees of the sales
office, including respondents No. 9 to 12 and 18 to 22 were retrenched.
 On the 27th January 1967, at about 1 p.m. the retrenched employees along with 70
others, blockaded the said corporation's premises. completely obstructing the passage
of personnel and goods, including food stuffs for the barricaded persons inside, who
were wrongfully confined therein. The blockade was lifted at 3 A.M. on 28th January
1967 after police intervention.
 Government in West Bengal, came into office. On 2nd March, 1967 the retrenched
workers, together with other employees numbering about 200 persons gheraed the
manager (petitioner No. 2) and other officers at the office premises from 1 P.M. and
the gherao continued for 33 hours, being lifted at 10 P.M. on 3rd March 1967. It is
said that the said persons confined the manager, the petitioner No. 2 and the other
officers, namely the petitioners Nos. 3 to 7, tampered with the company's property
spoilt the walls and continuously shouted insulting and humiliating slogans against
the confined persons.
 The said retrenched workers, together with other employees numbering about 100 to
150 persons gheraoed the manager and other officials at the said office and kept them
under wrongful confinement. The beseigers, trespassers into the office, tampered with
 P a g e | 23

property and shouted insulting and humiliating slogans against the confined persons.
Only a minimal amount of food was allowed to be taken in, at the will of the
besiegers. Information’s was given to the police but no action was taken.

Issue:

1. What is a "gherao" ?
2. Is 'gherao' as practised in this case lawful ?

Observations made by the Court:

 Though workers may, go on peaceful strikes which are not illegal they have no right
to resort to coercive methods like wrongful restraint, wrongful confinement and
criminal trespass which are all cognizable offences. Such methods are also
unwarranted as there is a machinery set up by law to deal with all industrial disputes.
 Strikes are governed by the Industrial Disputes Act, (Central Act XIV of 1947). The
Act defines legal and illegal strikes. The District Officers' main concern will be the
law-and-order aspect of the affair the industrial dispute itself being that of the Labour
Department.
 In case of gherao of industrial establishments by their workers, resulting in
confinement of managerial and other staff, the matter should be immediately referred
to the Labour Minister and no police intervention for the rescue of the confined
personnel should be decided upon without obtaining his direction.
 The origin of trade unionism in India may be traced back to 1890 when workers of
Bombay organised a union called the Bombay Millhands Association. In England,
trade unionism existed under the Common Law but it existed under several handicaps
and had to be developed by continuous legislation. In 1921, the Madras High Court
granted an injunction restraining the Madras Textile Labour Union Officials from
influencing labourers in the Buckingham and Carnatic Mills, from breaking their
contract with their employers by means of a strike with a view to obtain increased
wages.
 Whenever Trade Unionism has exceeded bounds and become militant, for example
the Strikes in England in 1926 and the Civil disobedience movement in 1932, when
trade Unions tried to take advantage of the same, there has been a retrogression in the
forward march of Trade Unionism.
 P a g e | 24

The lawful activities of trade unionism are to be found in Section 15 of the Act, which I set
out below :

The general funds of a registered Trade Union shall not be spent on any other objects than
the following, namely :-

(a) the payment of salaries, allowances and expenses to officers of the Tirade Union;

(b) the payment of expenses for the administration of the Trade Union, including audit of the
accounts of the general funds of the Trade Union :

(c) the prosecution or defence of any legal proceeding to which the Trade Union or any
member thereof is a party, when such prosecution or defence is undertaken for the purpose of
securing or protecting any rights of the Trade Union as such or any rights arising out of the
relations of any member with his employer or with a person whom the member employs;

(d) the conduct of trade disputes on behalf of the Trade Union or any member thereof;

(e) the compensation of members for loss arising out of trade disputes;

(f) allowances to members or their dependants on account of death, old age, sickness,
accidents or unemployment of such members;

(g) allowances to members or their dependants on account of assurance on the lives of

members or under policies insuring members against sickness, accident or unemployment :

(h) the provision of educational, social or religious benefits for members (including the
payment of the expenses of funeral or religious ceremonies for deceased members) or for the
dependents of members;

(i) the upkeep of a periodical published mainly for the purpose of discussing questions
affecting employers or workmen as such;

(j) the payment, in furtherance of any of the objects on which the general funds of the Trade
Union may be spent, of contributions to any cause intended to benefit workmen in general,
provided that the expenditure in respect of such contributions in any financial year shall not
at any time during that year be in excess of one-fourth of the combined total of the gross
income which has up to that time accrued to the general funds of the Trade Union during that
year and of the balance at the credit of those funds of the commencement of that year; and
 P a g e | 25

(k) subject to any conditions contained in the notification, any other object notified by the
appropriate Government in the official Gazette.

 The extent of immunity from crimes in trade union activities is to be found in Section
17 of the Trade Unions Act, which reads as follows (See para 25A). Section 120B(2)
of the Indian Penal Code, referred to in S. 17 of Trade Unions Act, is couched in the
following language.

Decision of the Court:

Immobilization of police force and impugned circulars crude attempt to immobilise forces of
law and Order. Owners and managers of industries confined, restrained, assaulted and
tortured as result of circulars and were compelled to accede to even unreasonable demands of
labour. Such crude methods likely to destroy industry itself, such attempt to enrich one limp
at cost of another is to kill whole organism.

9 All India Bank Officers' Confederationand Ors v. Union Of India &

Ors [AIR 1989 SC 2045]

Facts:

 The first petitioner is a registered Central Trade Union claiming to represent about 85
per cent. of the officers working in the various nationalised banks. Petitioners 2 to 4
are principle office bearers of the first petitioner and are officers of different
nationalised banks.
 They contend that the circular is country to the mandate of the Banking Companies
(Acquisition and Transfer of Undertakings) Act, 1970 (Act 5 of 1970) (hereinafter
referred to as the Act') and the Nationalised Banks (Management and Miscellaneous
Provisions) Scheme, 1980.
 The object of the circular is to clarity that the Central Government no longer regards
itself bound by its earlier practice of appointing a person from out of the panel of
three names submitted by the respective Association representing the majority of the
non-workmen-employees of each Nationalised bank. The circular makes it clear that
the Government wishes to appoint any officer of proven ability and character to the
 P a g e | 26

Board of Directors of a nationalised bank irrespective of his affiliation with any

Association. The petitioners contend that the circular is undemocratic and country to
the letter and spirit of the Act and the Scheme insofar as it cuts at the letter and spirit
of the Act of selection for appointment to the Board of Directors as contemplated by
the statue.

Issues:

Whether the Scheme would not be even more defective if sub-clause (c) were to receive the
same contortion as sub-clause (b) so as to restrict the choice of appointment to the three
persons specified on the panel furnished by the representatives Association.

Observations by the Court:

 The object of the circular is to neutralise and discourage trade unionism among the
officers and to keep the directorship above union affiliation, and thus encourage the
growth of a "management culture." Mr. Rajinder Sachar, supported by Mr.
Ramamurthi, contends that there is no justification whatsoever to issue any such
circular for the very object of the Act is to encourage democratic selection of the
Directors who will truly represent the interests of the various categories of persons
mentioned in the Act. To discourage trade unionism is contrary to the very spirit of
the statute and repugnant to constitutional principles enshrined in Article 19(1)(c) and
Article 43-A of the Constitution of India.
 The object of Section 9 of the Act, insofar as it is material, is to empower the Central
Government to make a scheme for the constitution of the Board of Directors so as to
include representatives of the employees and other specified categories. "Employees"
include workmen and non-workmen. The categories specified, apart from the
employees, are depositors, farmers, workers and artisan. The representatives of these
classes of people are to be either elected or nominated in the manner specified by the
scheme.

Decision of the Court:

The circular dated August 32, 1982 (Annexure A) is ultra vires the Act and the Scheme and
was therefore, null and void and of no effect.
 P a g e | 27

10 Karur Vysya Bank Retirees’ Association vs. Deputy Commissioner of

Labour I DMS Compound [Civil Miscellaneous Appeal No.2758 of
2019]

Facts:

 It is the case of the Association that the members of the Association had decided to
form an Association to espouse their grievances, relating to pension and other
benefits, as the existing Trade Union is not widely bringing out their grievances. It is
the further case of the Association that the issue regarding the eligibility period for the
purpose pension can be raised in the form an Industrial Dispute and it cannot be done
by an individual or he cannot approach the Civil Court for the relief.
 It is submitted that the individual is also barred from approaching this Court by way
of Writ Petition, as the Court may shut the doors on the ground that the disputed
question of fact cannot be gone into before this High Court, a reading of Section 2(g)
of the Trade Unions Act, 1926 (in short ‘the Act, 1926’) shows that it authorizes any
person, who was in employment to form an Association, which should be registered
under the Act, 1926.
 Though the employer, workmen and industrial dispute have not been defined under
the Act, 1926, the Industrial Disputes Act alone can be invoked to raise a dispute
concerning the issue falling under Section 2(k) of the Industrial Disputes Act, 1947.
 It is stated by the learned counsel for the Appellant that the mandatory requirement is
that a group of seven persons can only form an Association and in that event, it is
obligatory on the part of the Authority to register the Trade Union, unless or
otherwise there are any obstacles like reflection of very same name or any other issue
concerned or that are prohibited under the 1926 Act.
 Even though in the year 2002, an amendment to the Act, 1926 was brought in, it no
way curbed retired employees or prohibited them to form an Association and the word
employed/engaged has got to be interpreted in such a way that it will include not only
persons, who are on the Roll but also were on the roll. Hence, the Court was in the
view that the Authority is bound to register the Association formed by the retired
employees unless there are any prohibited ground for non-registering the same.
 In case the Authority finds that the object of formation of the Association is not for
espousing the cause of its employees and deviates the conditions stipulated under the
 P a g e | 28

Act, 1926, then it is open to the Authority to refuse such registration, but not on the
ground that the retired employees will not be entitled to form an Association, thereby
discriminating them from the employees, who are on the roll.

Issues:

1. Whether the persons, who are on roll can only make such application for registration
of the Association under the Act, 1926 and even after amendment in the year 2002,
there was no deletion of any mandatory requirement.
2. Whether there should be a group of seven persons and in case the number is reduced,
still, the Authority is empowered to register the Trade Union, but making an
application with seven persons, who retired from service and are not connected with
the employment on the date of application.

Observations by the Court:

 Concerning registration of Trade Union, a judgment of Karnataka High Court in the

case of Government Tool Room and Training Centre’s Supervisory and Officers’
Association, Bangalore and another vs. Assistant Labour Commissioner and Deputy
Registrar of Trade Unions, Bangalore Division-I, Bangalore and others, and another
judgment of the Bombay High Court inBajaj Auto Ltd., vs. State of Maharashtra out
of these two judgments, though the finding of the Karnataka High Court does not
support the case of the Respondent herein, the other judgment of the Bombay High
Court is otherwise.
 When the Act itself provides for a wider definition and for a wider meaning of that
definition, the Courts cannot narrow it by its decision. That would be against the very
object of the Trade Unions Act itself. It is a well-settled principle of law that two
conditions are necessary for interpreting an earlier enactment in the light of the
provisions of a later Act. They are:

a. The two Acts of the Legislature must be in pari materia, that is to say, that they form a
system or code of Legislature; and

b. The provisions in the earlier Act is ambiguous.

Decision by the Court:

 P a g e | 29

Even if seven employees were not on the roll, they are entitled to form an Association that
has got to be registered under the Act, 1926 and the same cannot be refused to be registered
on this score.

Though the existing Union with permanent employees can espouse the cause of retired
employees or others, who were not in employment, on the ground of community of interest,
consequent to the absence of such interest in the present days, there is nothing wrong in
permitting the retired employees to have their Association under the Act, 1926, as Unions,
having permanent employees on the Roll, are withering away and shirking from their moral
responsibilities to espouse the cause of employees, who ceased to be on the roll. The
Association with retired employees cannot, in any event, raise a dispute about the service
conditions of employees on the rolls.

11 Canara Bank Employees vs. Canara Bank and Ors. [WP No. 34258
No. 2019]

Facts:

 On 29th November, 2019, the Department of Financial Services, The Union Finance
Ministry issued a circular to all nationalized banks regarding the online facility that
enables the employees to modify or record their mandate to auto-deduct the
subscription fee for the membership of the union. Pursuant to the above circular, the
Canara Bank issued a circular to its employees informing the implementation of the
circular issued by the finance ministry.
 The Canara Bank Employees’ Union and Canara Bank Officers’ Association filed two
separate writ petitions seeking declaration of the circular issued by the finance
ministry as invalid and non-est in law stating that the said circular violates the right of
the trade union to admit and remove the members of the union on valid grounds.
 In the present case, the petitioner trade union is a registered body having its own bye-
laws which has well-defined rules for admission of members, payment of subscription
fees for membership and removal of members from the union on valid grounds. The
petitioners contended that no employee can become the member of the union by mere
payment of subscription of fees as the union requires the employee to pay the
subscription fees only after the verification of application made by the employee for
the membership of union.
 P a g e | 30

 The respondent bank defended stating that even after the implementation of the
circular the bank plays no role in admission or maintenance of membership of an
employee in the trade union. The circular intends only to digitalize the process of
issuing mandate for auto-deduction of subscription fees which was earlier submitted
by the employees in physical format, thereby aligning with the advancement of
technology.

Issues:

1. Whether it is essential for the bank to verify with the trade union before deduction of
subscription fees, the status of membership of an employee who has modified his
mandate, in particular the membership status of the employee who claims to be a
member of the union.

Observations made by the Court:

 It observed that it is essential for the bank to verify with the trade union before
deduction of subscription fees, the status of membership of an employee who has
modified his mandate, in particular the membership status of the employee who
claims to be a member of the union.
 The court therefore directed the bank to inform the list of employees who recorded or
modified the mandate regarding auto-deduction of the payment of subscription fees
for the union on or before 20th of every month.
 The court further directed the union in turn to verify the status of membership of those
employees and communicate the same to the bank on or before 25th of every month.
 The court stated that based on the communication received from the union, the
deduction of subscription fees shall be made.

Decision of the Court:

the court by passed a common order for the two separate writ petitions filed by the Canara
Bank Employees Union and Canara Bank Officers Union. The court therefore while
modifying the circular issued by the union ministry, held that the bank do not have a say in
the admission of staff in the union and the right of admission and removal of members in the
union shall solely vests with the trade union. It also observed that the circular shall be read in
alignment with the above order.
 P a g e | 31

12 The Workmen of Firestone Tyre and Rubber Co. of India (Pvt.) Ltd.
Vs. The Management and Ors. [1973 SCR (3) 587]

Facts:

 The Workmen of Firestone Tyre and Rubber Co. of India had a Dispute with its
employer regarding the termination of its workmen on a Domestic Enquiry finding.
During the pendency of the Dispute, the Industrial Tribunal Act had been Amended in
1971, and Section 11A conferring the powers of Appellate Authority to the Industrial
Tribunal over the Domestic Enquiry decision had been inserted.
 The Tribunal decided the case in favor of the Employer, refusing to have a
Retrospective effect of Section 11A.

Issues:

What is the proper interpretation of section 11A of the Industrial Disputes Act and whether it
has a retrospective application (whether it applies to industrial disputes pending as on 15-12-
1971).

Observations made by the Court:

 The Court observed that the right to take disciplinary action and to decide upon the
degree of punishment is only a part of the managerial functions. However, if a dispute
is referred to the Tribunal, the tribunal is equipped with the power to see if the
employer’s action is justified. According to Indian iron and steel Co. Ltd. case, the
court can interfere in the dispute (i) when there is want of good faith; (ii) when there
is victimization or unfair Labour practice, (iii) when the management has been guilty
of an error or a violation of the principles of natural justice or (iv) when findings are
completely baseless and perverse as per the materials
 When a proper inquiry has been held by an employer, and the finding of misconduct
is deemed to be a possibility the Tribunal, as an appellate body has no jurisdiction to
oversee a judgment and go beyond the decision of the employer. The interference
with the decision of the employer will be justified and imposed only when the
findings arrived at the inquiry shows that management is guilty of exploitation, unfair
labor practice, or malicious intentions.
 In the case of Madras v. workers of Buckingham and Carnatic company Ltd., it was
held that decision of the Management in relation to the charges against the employee
 P a g e | 32

will not prevail-if (a) there is want of bona fide, or (b) it is a case of victimization or
unfair labor practice or violation of the principles of natural justice, or (c) there is a
basic error of facts or, (d) there has been a perverse finding on the materials.
 In cases when no inquiry has been held by an employer/if the inquiry held is
defective, the Tribunal can satisfy itself about the legality of the order only when it
gives an opportunity to the employer and employee to present evidence before it. It is
up to the employer to adduce/present evidence for the first time justifying his action
and to the employee to adduce evidence contra.
 The Court also opined that the effect of an employer not holding in inquiry is that the
Tribunal would not have to consider only whether there was a prima facie case. The
Court will the opine on the issue about the merits of the impugned order of dismissal
and on the evidence adduced before it which will decide for itself whether the
misconduct alleged is proved or not. In cases like these, the idea of exercising
managerial functions does not arise at all and cannot be disputed.
 The Tribunal can get jurisdiction to consider the evidence placed before it for the first
time only, if no inquiry has been held or after the inquiry conducted by an employer is
found to be defective in justification of the action.
 Adducing evidence for the first time: An employer, who wants the opportunity of
adducing evidence to justify his actions for the first time before the Tribunal, should
ask for it at the appropriate stage. If asked, the Tribunal has no power to refuse since
the giving of an opportunity to an employer is in the interest of both the management
and the employee and to come at an equitable decision about the alleged misconduct.
 Punishment: The bench stated that once the misconduct is proved (either in the
inquiry or by the evidence placed), the punishment imposed cannot be interfered with
by the Tribunal except in cases where the punishment is extremely harsh and
exploitative. The Tribunal can consider not only whether the finding of misconduct
recorded by an employer is correct, but can also differ from the said finding if a
proper case is made out.
 Under section 11A by the Tribunal is reached only when it has to consider the
punishment after having accepted the finding of guilt recorded by an employer. It has
to be remembered that a Tribunal may hold that the punishment is not justified
because the misconduct alleged and found proved is such that it does not warrant
dismissal or discharge.
 P a g e | 33

 The Tribunal can also hold that the order of discharge or dismissal is not justified
because the misconduct is not established by the evidence. To come to a conclusion
the Tribunal is equipped to consider and judge the evidence for itself and it may hold
that the misconduct is not proved or that the misconduct proved does not entail the
punishment of dismissal. This is why Section 11A now gives full power to the
Tribunal to go into the evidence and satisfy itself on both these points.
 Materials on Record: According to the Court, the expression ‘materials on record’,
occurring in the Act cannot be confined only to the materials which were available at
the domestic inquiry. They must be held to refer to materials on the record before the
Tribunal and they take in (1) the evidence was taken by the management at the
inquiry/ proceedings of the inquiry, or (2) the above evidence with any further
evidence before the Tribunal, or(3) evidence placed before the Tribunal for the first
time in support of the action taken by an employer as well as the evidence given by
the workman.
 In case an employer with a limited number of workmen may himself be a witness to
misconduct committed by a workman, he will be disabled from conducting an inquiry
against the workman because he cannot both be an inquiry officer and also a witness
in the proceedings but he will certainly be entitled to take disciplinary action for
which role he can file a charge sheet and impose the necessary punishment, after
calling for explanation, without holding any prior inquiry. This will be a case where
no inquiry at all has been held by an employer. available with him which could be
produced before any Tribunal to satisfy it about the justification for the action taken
 The principle is well established that a retrospective operation is not to be given to a
statute so as to impair an existing right. This is the general rule. But the legislature is
competent to pass a statute so as to have retrospective operation, either by clearly
expressing such intention or by necessary and distinct intendment. That procedural
law has always been held to operate even retrospectively, as no party has a vested
right in the procedure.

Decision of the Court:

The scheme of the section and particularly the wording of the Proviso hence indicate that
Section 11A does not apply to disputes which had been referred before 15-12-1971. The
section applies only to disputes which are referred for adjudication on or after 15-12-1971
and not before the said date.
 P a g e | 34

13 M/S Pawan Hans Limited vs. Aviation Karamchari Sanghat [Civil

Appeal No 353 of 2020]

Facts:

 The company was incorporated in the year 1985 under the Companies act 1956. The
Government of India holds 51% shareholding and the remaining 49% is held by the
Oil and the Natural Gas Company Ltd. (ONGC).
 The primary objective of the company was to provide helicopter and charter services
for promotion of tourism in hilly areas.
 The company drafted its Pawan Hans Employees provident Fund Trust Regulation.
The total workforce was of 840 employees in which 570 were regular and the rest 270
were on a contractual basis. The company had made an exception in the definition of
the term employee and excluded the contractual working people from the said benefit.

Issues:

Whether the contractual employees of the appellant company are entitled to provident fund
benefits under the Pawan Hans employee’s provident fund trust regulations or the employee’s
provident fund scheme 1952?

Observations made by the Court:

 The Hon’ble High Court allowed the writ petition filed by the trade union because the
liberal view has to be adopted in extending the social security benefits to the
contractual employees.
 The Company disappointed by the verdict of the HC challenged the same in the
Hon’ble SC because it is excluded from the applicability of the provision of the EPF
Act and the EPF scheme.
 The SC agreed with the views of the HC. The Supreme Court gave two tests to
provided exemptions of ownership of the government and secondly the employees
should be a benefit as per the rule and scheme framed by the central or state
government governing such benefits.

Decision of the Court:

The company failed to follow the second test and therefore the exemptions cannot be claimed
under Section 16(1) (b) of the EPF Act.
 P a g e | 35

14. All India Bank Employees’ Association vs. National Industrial Tribunal
and Ors.[AIR 1962 SC 171]

Facts:

 The appellant before the Court was the All India Bank Employee’s Association which
is a trade union organization of Bank Employees of several banks operating in India.
The Punjab National Bank Employee’s Union, which is a trade union with similar
objects has been permitted to intervene in the current appeal in support of the
appellant union. The three other Writ Petitions are by other Bank Employees’ Unions
and all these cases have been heard together because in the writ petitions the point
raised is identical, viz.
 Post the Banking Companies Act and after the Tribunal started functioning as iterated
in the judicial background and after the parties formulated their respective
contentions, applications were filed by the Bank Employees Association on June 9,
1960, for directing the respondent-banks to produce before the Tribunal for the
purposes of adjudication several documents listed in the applications. Among the
items in respect of which production was thus sought were (1) statements showing
“the secret reserves in any form” of each bank from 1954 right up to December 31,
1959; and (2) statements showing the provision made “for bad and doubtful debts and
other usual and necessary provisions” during the years 1954 to 1959 and the total
amounts outstanding in such items in each bank in the said years. The banks filed
their reply on July 16, 1960. The production of the documents and the information
called for on several of the matters including the above two was resisted by the Indian
Banks Association (being an association of employers) on the ground that they were
by law exempted from disclosure in the interest of the industry and the public and
claimed absolute privilege from making the disclosure.
 It was at this stage that the impugned provision was enacted by Parliament as an
amendment to the Banking Companies Act. As several of the banks relied upon the
impugned provisions in support of their plea that they could not be compelled to
disclose either the quantum of their secret reserves or their nature or as regards the
provision made in the several years for “bad and doubtful debts and for other
reasonable and necessary provision”, the bank employees association challenged the
constitutional validity of section 34A of the Banking Companies Act, which, if valid,
 P a g e | 36

could have afforded a sufficient answer to the demand for production of the
documents in relation to these matters. This objection was argued before the National
Tribunal which upheld the validity of the section (Civil Appeal No. 154 is directed
against and challenges the correctness of this decision.) The Writ Petitions have been
filed by Bank Employees Associations which were not parties to the application for
production before the National Tribunal and are intended to support the plea of the
appellant in Civil Appeal No. 154 of 1961.

Issues:

1. The impugned legislation contravened the fundamental right guaranteed to “trade unions”
by the provision contained in sub-clause (c) of clause (1) of Article 19; and;

2. That it violated the freedom of equality guaranteed by Article 14 of the Constitution.

Observations made by the Court:

 Expression ‘union’ in addition to the word ‘association’ found in the Article refers to
associations formed by workmen for “trade union” purposes; the word ‘union’ being
specially chosen to designate labor or Trade unions.
 The right to “form a union” in the sense of forming a body carries with it as a
concomitant right a guarantee that such unions shall achieve the object for which they
were formed. If this concomitant right were not conceded, the right guaranteed to
form a union would be an idle right, an empty shadow lacking all substance.
 The object for which labor unions are brought into being and existence is to ensure
collective bargaining by labor with the employers. The necessity for this has arisen
from an incapacity stemming from the handicap of poverty and consequent lack of
bargaining power in workmen as compared with employers which are the reason
d’etre for the existence of labor organizations.
 In regard to the right of labor unions to function effectively and to achieve the object
of their existence the only limitations permitted to be imposed by law are those set out
in clause (4) of Article 19 and unless, therefore, either the objects of the association or
the manner of achieving them are contrary to, or transgress public order or morality,
for which reason alone reasonable restrictions might be imposed upon the guaranteed
right, the freedom guaranteed is absolute.
 P a g e | 37

 Section 34A (1) and (2) violated Article 14 in that the classification contained in it
was impermissible as not being based on rational grounds. It was said
 That the protection against a disclosure applied only to adjudications under the
industrial Disputed Act and not to other adjudications; (2) that it applied only to
certain banking companies and not to all banking companies; and (3) that by reason of
section 34A (2) the provisions of the impugned enactment were applied in a
discriminatory manner to all banks other than the Reserve Bank.
 If an association was formed for carrying on a lawful business, the guarantee by sub-
clause (c) of the freedom to form the association does not carry with it a further
guaranteed right to the company or the partnership to pursue its trade and achieve its
profit-making object and the only limitations which the law could impose on the
activity of the association or in the way of regulating its business activity will not be
those based on public order and morality under clause (4) of Article 19. If the
opposite was accepted, any such argument would mean that while in the case of an
individual citizen to whom a right to carry on a trade or business or pursue an
occupation is guaranteed by sub-clause (g) of clause (1) of Article 19.

Decision of the Court:

The court held that s. 34-A of the. Banking Companies Act, 1949, was constitutionally valid
and did not and either Art. 19(1)(c) or Art. 14 of the Constitution.

15. B.R . Singh vs. Union of India [AIR 1990 SC 01]

Facts:

 Trade Fair Authority of India Employees' Union had been demanding from the
management (i) housing facilities for the employees; (ii) regularisation of at least 50%
of casual or daily rated employees and (iii) upward revision of the salaries and
allowances of the workers. These demands were discussed by the Union with the
management from time to time but nothing concrete except assurances emerged.
 The General Manager however declined to grant the necessary permission. But the
General Body Meeting of the Union was held as scheduled and a decision was taken
to strike work on 21.1.1987 as a protest.
 P a g e | 38

 The management was put on notice, which reacted by suspending the President,
Vice President & other Executive Members of the Union. Workers' demand for
withdrawal of the orders of suspension was rejected. Instead all the remaining
office bearers & leading activists were suspended. These suspended employees have
filed a writ petition challenging their suspension.

Issues:

1. Whether the said strike by the Trade Union is illegal.

2. Whether the employee participating in such strikes be suspended.

Observations made by the Court:

 The right to form association or Unions is a fundamental right under Article 19(1)
(c) of the Constitution. The necessity to form unions is obviously for voicing the
demands and grievances of labour. The trade unionists act as mouthpieces of labour,
[270A-B]
 Strike in a given situation is only a form of demonstration, e.g. go-slow. sit-in-work
to rule absentism etc. Strike is one such mode of demonstration by workers for
their rights. The right to demonstrate and, therefore, the right to strike is an important
weapon in the armoury of the workers.
 This right is recognised by almost all Democratic Countries. But the right to strike is
not absolute under our industrial jurisprudence and restrictions have been placed on
it by section 10(3), 10A (4A), 22 and 23 the Industrial Disputes Act.
 These provisions, however, have no application to the present case since it is no
body's contention that the Union's demands had been referred to any forum under the
statute. Though there were angry protests and efforts to obstruct the officers from
entering the precincts of TFAI there was no convincing evidence of use of force of
violence.

Decision of the Court:

The orders terminating the services of the 12 union representatives were set aside and they
are ordered to be reinstated in service forthwith with back wages coveting a period of 6
 P a g e | 39

months immediately preceding the date of the order. In view of the above directions ,the
C.M.P- TFAI was directed to pay Rs.5,000 in all by way of costs to the Union.

CONCLUSION:

Trade Unionism in India has come a long way. Initially from having no legal backing to
illegalizing “strikes” by the unions to granting them registration procedure and compulsory
recognition and now having full-fledged legislations and special courts, trade unions in India
have attained remarkable status/standing in the labour movement. However, there are still
few impediments that the trade unions face such as lack of financial resources and
governmental support. Hence, there is still scope for the development of Trade Unionism in
India.