M.M. Kumar, J.
1. The petitioner-management Haryana StateIndustrial Development Corporation for brevity theHSIDC') has challenged the ex-parte award of the LabourCourt, Chandigarh dated 3.4.1998 and the subsequent orderof the Labour Court dated 10.4.2001 dismissing theapplication of the HSIDC for setting aside the ex-parteaward.
2. Facts in brief are that workman-respondent No. 3was working as a Tracer on fixed remuneration @ Rs. 646/-p.m., which was D.C. rate fixed under the Minimum WagesAct, 1948. On 10.9.1988, his services were dispensed withas no longer required. The Labour Court passed as awarddirecting reinstatement of the workman-respondent No. 3with continuity of service but held that the workman wasnot entitled to payment of any backwages till 3.2.1990 asthe demand notice was issued by his after one and halfyear of his termination. He was however, held entitledto wages @ 70% for the subsequent period. On 9.3.1992,workman-respondent No. 3 was reinstated in service andbackwages were paid by HSIDC as per the award of theLabour Court. The workman-respondent No. 3 filed anapplication under Section 33-C(2) of the IndustrialDisputes Act, 1947 (for brevity 'the Act') before theLabour Court claiming that he was entitled to regular payscale of Rs. 1200-2040 but the same was dismissed on2.2.1995 as not maintainable because the claim of theworkman was neither adjudicated or recognised by themanagement in any ward or settlement. Thereafter theworkman-respondent No. 3 sent a demand notice (AnnexureP-2), claiming regularisation, pay scale of Rs. 1200-2040,attendant benefits and interest @ 18% on the different ofemoluments.
3. It is significant to note that on 30.12.1996,HSIDC on its own and in pursuance of the governmentinstructions dated 27.5.1993 offered theworkman-respondent No. 3 appointment to the post of Tracerin the pay scale of Rs. 1200-2040 on regular basis but onprobation of one year. Accordingly accepting the termsrecorded in the appointment letter (Annexure P-3),workman-respondent No. 3 joined on 31.12.1996 (AnnexureP-4). In pursuance of settlement between HSIDC and theworkman-respondent No. 3, the demand notice sent byworkman-respondent No. 3 was withdrawn on 8.1.1997 videAnnexure P-6, which is a copy of the registered lettersent by the workman-respondent No. 3 to the AssistantLabour Commissioner-cum-Conciliation Officer, U.T.Chandigarh, and it reads as under:
'The above case was fixed forconsideration in the month ofSeptember/October, 1996.
The Haryana State Industrial DevelopmentCorporation has issued letter on 30.12.1996.Photocopy of which is enclosed herewith. Inthis letter they have given me the regularcadre in the pay scale of Rs. 1200-2040 withimmediate effect.
I have been placed on probation for oneyear.
I have given my joining report in view ofregularisation letter dated 30.12.1996.
I am therefore, withdrawing my demandnotice which is pending before your goodself,the necessary intimation may be sent to theGovernment.'
4. The HSIDC did not expect reference of anydispute to the Labour Court in respect of which settlementhad been arrived at with workman-respondent No. 3.However, the same dispute was referred to the LabourCourt. U.T. Chandigarh under Section 10(1)(c) of the Actand after adjudication it was decided on 3.4.1998 infavour of workman-respondent No. 3 on 3.4.1998. The LabourCourt in its ex-parte award (Annexure P-7) held that hewas entitled to pay scale of Rs. 1200-2040 with effect from31.3.1993. The application of the HSIDC seekingsetting-aside of the ex-parte award on various grounds hasbeen dismissed by the Labour Court vide order dated10.4.2001 (Annexure P-8). Feeling aggrieved, HSIDC hasapproached this Court with the prayers that the ex-parteaward dated 3.4.1998 Annexure P-7 and the order dated10.4.2001 refusing to set-aside the ex-parte award bequashed.
5. In his written statement, workman-respondentNo. 3 has taken the stand that the appropriate governmentwas apparently satisfied that dispute existed or wasapprehended regarding non grant of scale of pay witheffect from 31.3.1993. Therefore, it has been claimedthat the reference was rightly made by the appropriategovernment to the Labour Court and no exception can betaken to the award dated 3.4.1998 (Annexure P-7) and theorder dated 10.4.2001 (Annexure P-8). It has further beenclaimed that ex-parte award was passed by the Labour Courton 3.4.1998 and the same was not challenged. However,after about one and half year on 19.11.1999, anapplication for setting-aside ex-parte award was filedbefore the Labour Court, which has been dismissed on10.4.2001. Therefore, it is claimed that the instantpetition is liable to be dismissed on account of delay andlaches. It has also been claimed that in the applicationfiled on 19.11.1999, it is conceded that HSIDC was dulyserved but Sh.G.S. Sawhney, its Manager (Legal), who wasincharge of the case did not process the case.
6. We have heard Mr. A.K. Pathania, learnedcounsel for HSIDC, who has argued that afterworkman-respondent No. 3 had sent an application on8.1.1997 (Annexure P-6) to the Assistant LabourCommissioner-cum-Conciliation Officer, no dispute wouldsurvive for reference under Section 10(1)(c) of the Actbecause the workman in writing has withdrawn his demandnotice after feeling satisfied with the order ofregularisation on the post of Tracer in the pay scale ofRs. 1200-2040 with effect from 1.1.1997. According to thelearned counsel, the reference made on 28.1.1997 by theU.T. Chandigarh is without jurisdiction and anydetermination by Labour Court on the basis thereof isliable to be setaside. Therefore, he has prayed forquashing of the ex-parte award dated 3.4.1998 (AnnexureP-7) and the order of the Labour Court refusing toset-aside the ex-parte award dated 10.4.2001.
7. Mr. Deepak Arora, learned counsel forworkman-respondent No. 3 has submitted that dispute existedwith regard to payment of wages with effect from 31.3.1993till 31.12.1996 in the pay scale of Rs. 1200-2040 or in anycase the same was appreciated by the Assistant LabourCommissioner-cum-Conciliation Officer, U.T. Chandigarhwithin the meaning of Section 10(1)(c) of the Act.According to the learned counsel, there is no legalinfirmity in the reference made by the Assistant LabourCommissioner-cum-Conciliation Officer, U.T. Chandigarh.
8. We have thoughtfully considered the rivalcontentions raised by the learned counsel for the partiesand are of the view that this petition deserves tosucceed. The definition of expression Industrial Disputeunder Section 2(k) of the Act makes it evident that anydifference or dispute connected with the employment,non-employment, terms of employment or with the conditionof labour would be an industrial dispute within themeaning of that section. However, in cases where thedifference or dispute between the parties have beenamicably settled resulting in filing of application forwithdrawal of the demand notice, it would be trite to saythat no dispute would exist. Therefore, no reference assuch would require to be made.
9. The question as to whether the appropriategovernment is entitled to cancel the reference alreadymade has been answered in negative by the Supreme Court incatena of judgments. By interpreting Section 10(1) ofthe Act, it has been observed by the Supreme Court inState of Bihar v. D.N. Gangul AIR 1958 S.C. 1018 thatthe appropriate government having once made a referencewould not be competent to cancel or supersede the same asno express power has been conferred. However, there isnothing in the Act prohibiting the Labour Court frominterpreting the term of settlement in his award and passthe award accordingly because once a settlement has beenentered into between the management and the workman, thenits validity on the touchstone of arbitrariness anddiscrimination cannot be tested. These views have beenexpressed by the Supreme Court in the case of I.T.C.Limited Workers Welfare Association v. I.T.C. Limited(2002) 3 SCC 411. In that case during the course ofconciliation proceedings, a settlement was entered intobetween the management and the workers and after thesettlement has been arrived at dispute was referred foradjudication to the Industrial Tribunal and the Tribunalanswered the reference in favour of the management andagainst the workers union. The award of the Tribunal wasupheld by the High Court and then by the Supreme Court.The views of the Supreme Court on the question relevant inthe present case could be gleaned from the followingobservations of their Lordships:-
'What remains to be considered is whether it isfair and just, viewed from a broader angle andtaking a holistic view of the matter. Thepresent case is one where Article 14 cannot beapplied as the respondent is not 'State' or'other authority'. It is true that certainconsiderations germane to Article 14 may alsobe germane while deciding the issue whether thesettlement is just and fair. But, it does notfollow that the doctrine of classification andthe principles associated with it should beprojected wholesale into the process ofconsideration of justness and fairness of thesettlement. There may be some overlapping andthere may be some facets which apply in commonto determine the crucial issue whether thesettlement on the whole is just and fair, butthat is not to say that the settlement isliable to be tested on the touchstone ofArticle 14, more os when it has no applicationin the instant case. Keeping this distinctionin mind and considering the grounds of attackon the particular clause of settlement, it isnot possible to hold that it is vulnerable tochallenge on any well-recognised grounds. Thefacts on record do not establish that thesettlement which was reached was palpablyunjust or unfair from the point of view of theentire body of workmen. The preponderance ofcircumstances and the material on record do notdisplace the presumption attached to thesettlement arrived at in the course ofconciliation.'
10. If the facts of the present case are examinedin the light of principles enunciated by the Supreme Courtin ITC Workers Welfare Union's case (supra) or judgementsof the Supreme Court referred above, it becomes evidentthat the award dated 3.4.1998 passed by the Labour Courtcannot be sustained in the eyes of law nor the order dated10.4.2001 could be considered to be valid. To our mind,the course open to the Labour Court in such circumstanceswas to conclude that the dispute between the HSIDC and theworkman-respondent No. 3 has been amicably settled and,therefore, nothing survives for adjudication. This coursecould have been adopted by the Labour Court when anapplication for setting-aside the ex-parte award was madeand these facts that the workman has accepted the payscale of Rs. 1200-2040 with effect from 1.1.1997 and thatthe demand notice issued by his was withdrawn. The LabourCourt committed a legal mistake by proceeding with theadjudication of the reference and going beyond thesettlement arrived at between HSIDC and theworkman-respondent No. 3. Therefore, the order of theLabour Court dated 10.4.2001 and the order dated 3.4.1998are liable to be set-aside.
11. For the reasons recorded above, we allow thispetition. The ex-parte Award dated 10.4.2001 and theorder dated 3.4.1998 refusing to set aside the award areset aside.