R.P. Sethi, C.J.
1. The scope of Section 10 of the Industrial Disputes Act (hereinafter called the 'Act') in relation to the powers of the appropriate Government of making reference to Labour Court, Board or Tribunal, is sought to be settled in this appeal. Does the Government have the powers to determine the merits of the claim of the workmen before making reference or is it obligatory upon the Government to make a reference where a primafacie dispute is shown to be in existence? The learned Judge, vide the order impugned in this appeal held that the nature and scope of the scrutiny envisaged under Section 10 authorised the Government to examine the merits of the claim and decline to make a reference upon being satisfied that the grievance projected was baseless, without substance, frivolous or unjustified.
2. In order to appreciate the controversy regarding the scope and ambit of Section 10 of the Act, some of the facts which are not in dispute are required to be taken note of. The appellant-Union representing the employees who are in the employment of respondent-Corporation raised a dispute with respect to their service conditions. It was contended by the workers that they possessed the requisite skills and qualifications for the higher post of Operatives (General) and Operative (Works) and Junior Assistants, but were wrongly retained in the Helper cadre only depriving them the benefits of the posts of Operatives and Junior Assistants. They claimed that they were entitled to in service recruitment to the higher post which was denied. This averment of the workmen was denied by the Management, who stated that the workmen were unsuitable for the higher posts. The case was referred to conciliation and the concerned officer submitted a failure report. Upon consideration of the failure report, the respondent-Government vide endorsement dt. 17.6.1992 held that the case projected by the workmen was not a fit case in which a reference could be made. Detailed reasons were set-out in the order passed by the respondent. The Government vide its order dated 25.6.93 reiterated the position by declaring that no case existed for making a reference. Aggrieved by the aforesaid two orders, the Appellant-Union filed the Writ Petition in this Court which was dismissed by the learned Single Judge vide the order impugned in this appeal.
3. Section 10 of the Act provides that where the appropriate Government is of the opinion that any industrial dispute exists or is apprehended, it may at any time, by order in writing, refers the dispute to a Board, Court or Tribunal in accordance with the procedure prescribed under the said Section. The opinion to be formed for the purposes of making the reference does not envisage the adjudication of dispute itself. Appropriate Government has the power to primafacie determine the existence of the industrial dispute which does not mean the conferment of power to finally dispose of the dispute itself. While exercising power under Section 10(1) of the Act the Government performs the administrative function and not a judicial or quasi-judicial function. In RAM AVTAR SHARMA v. STATE OF HARYANA : (1985)IILLJ187SC , the Apex Court held :
'Now if the Government performs an administrative act while either making or refusing to make a reference under Section 10(1), it cannot delve into the merits of the dispute and take upon itself, the determination of lis. That would certainly be in excess of the power conferred by Section 10. Section 10 requires the appropriate Government to be satisfied that an industrial dispute exists or is apprehended. This may permit the appropriate Government to determine primafacie whether an industrial dispute exists or the claim is frivolous or bogus or put forth for extraneous and irrelevant reasons not for justice or industrial peace and harmony. Every administrative determination must be based on grounds relevant and germane to the exercise of power. If the administrative determination is based on ground irrelevant, extraneous or not germane to the exercise of power it is liable to be questioned in exercise of the power of judicial review.'
4. The same position of law was reiterated by Supreme Court in TELCO CONVOY DRIVERS MAZDOOR SANGH v. STATE OF BIHAR : (1989)IILLJ558SC , wherein it was held:
'It is now well settled that, while exercising power under Section 10(1) of the Act, the function of the appropriate Government is an administrative function and not a judicial or quasi judicial function, and that in performing this administrative function the Government cannot delve into the merits of the dispute and take upon itself the determination of the lis, which would certainly be in excess of the power conferred on it by Section 10 of the Act. See RAM AVTAR SHARMA v. STATE OF HARYANA, M.P. IRRIGATION KARAMCHARI SANGH v. STATE OF M.P., SHAMBU NATH GOYAL v. BANK OF BARODA, JULLUNDAR.
Applying the principle laid down by this Court in the above decisions, there can be no doubt that the Government was not justifier in deciding the dispute. Where, as in the instant case, the dispute is whether the persons raising the dispute are workmen or not, the same cannot be decided by the Government in exercise of its administrative function under Section 10(1) of the Act. As has been held in M.P. Irrigation Karamchari Sangh's case (supra), there may be exceptional cases in which the State Government may, on a proper examination of the demand, come to a conclusion that the demands are either perverse or frivolous and do not merit a reference. Further, the Government should be very slow to attempt an examination of the demand with a view to declining reference and Courts will always be vigilant whenever the Government attempts to usurp the powers of the Tribunal for adjudication of the valid disputes, and that to allow the Government to do so would be to render Section 10 and Section 12(5) of the Act nugatory.'
5. To the same effect is the judgment of Supreme Court in 1991 SCC (Lab) 1125, of this Court in NAGESWARA B.S. AND ORS. v. STATE OF KARNATAKA AND ANOTHER 1987 (1) KLJ 384 and other host of authorities.
6. On the basis of various pronouncement made by the Apex Court and this Court it can be safely held that ;
(a) Making of reference is obligatory upon the appropriate Government where the existence or apprehension of an industrial dispute is prima facie established;
(b) In exercise of its powers the appropriate Government exercises the administrative function and not a judicial or quasijudicial function;
(c) The appropriate Government is not empowered to decide the merits of industrial dispute under the grab of giving reasons for refusal to make reference;
(d) Appropriate Government cannot decide disputed questions of fact;
(e) The dispute regarding the existence of the dispute between employer and the employee and their relationship cannot be adjudicated;
(f) As no period of limitation, is prescribed for making the reference, the appropriate Government has no power to reject a claim merely on the ground of the same being belated or stale;
(g) The questions of law sought to be adjudicated cannot be determined by the Government while deciding the question of making reference under Section 10 of the Act.
7. In the instant case the case of the appellants was considered by the appropriate Government in detail before holding that the dispute raised did not merit reference for adjudication. While declining to make the reference it was held :
'1. Case of Sri D. Raju and Ors. : Sri D. Raju and Others contend mainly that they have been regularised as workers in the Helpers Cadre in the Karnataka Power Corporation, though they have the requisite higher qualification to be appointed to the posts of Operatives (General)/Operatives Works/Junior Assistants. They also contend that several others have been appointed later in the posts of Operatives (General)/Operatives Works and also to the posts of Junior Assistants, which are all of the same cadre. On a subsequent date, they demanded absorption in the said post to them. It is the contention of the Management that all these exercises, creation of posts of Operatives (General) in 1979 etc., were all results of Settlement between the recognized Union and the Management. They contend that the Petitioners also were given a chance in 1990 when the posts of 80 Junior Assistants were filled up. But, these candidates who were among the 520 candidates examined were not successful. Therefore, they are not eligible for the higher posts.
Though there is a provision in the Cadre and Recruitment Rules for inservice recruitment to the posts of Operatives, the Petitioners were not selected to the said posts. They may have the requisite qualification; but they were not found suitable at the time of selection. The selection made during 1973 to 1977 out of NMR workcharged employees was to the posts of operatives (Works) and not to the posts of Operatives (General). It is only during 1979 when the posts of Operatives (General) was created to which posts only the family members of the land owners who lost their land at the time of acquisition of the area for construction of Raichur Thermal Plant were appointed. Few people in Bangalore only were selected from the NMR Cadre as Operatives (General). It is only during 1982 that the common seniority was prepared in respect of all these cadres i.e., Operatives (General) and Junior Assistants and from that time only eligibility for selection from the common Seniority list comes to these petitioners. They may not be able to claim the benefit prior to 1992. Unfortunately, when new posts of Junior Assistants equal to Operatives (General) were created in 1987 and selections were made in 1990, these persons were found again not successful. Thus, they may not be able to claim automatic selection.'
8. A perusal of the Government order will clearly indicate that the Government had ventured to adjudicate the dispute itself and declined to make a reference on the ground of delay and laches, which is the duty and function of the Labour Court, Board or Tribunal. The adjudication by the Government cannot be termed to be a administrative act but has to be assumed as a judicial pronouncement of the rival claims of the parties which admittedly is beyond the scope of powers vesting in the Government under Section 10 of the Act. The learned Single Judge appears to have ignored this aspect of the matter while dismissing the Writ Petition. In view of the settled position of law, the order of the learned Single Judge cannot be sustained. The appeal is accordingly allowed by setting-aside the order of the learned Single Judge and allowing the Writ Petition filed by the appellants. Rule is issued by quashing Annexure-D bearing No.SWL 454 LID 92 dated : 17.6.1992, and Annexure-F, endorsement dated 25.6.93, in so far as the Industrial Disputes in respect of D. Raju and others are concerned. The command is issued to the appropriate Government to pass fresh orders of making the reference of the industrial dispute raised by the appellant in the light of the observations made herein above and in terms of the provisions of Section 10 of the Act.
9. The appellants are entitled to costs through-out.