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Kedia Distilleries Ltd. Vs. Chhattisgarh Chemical Mill Mazdoor Sangh and ors. - Court Judgment

SooperKanoon Citation
SubjectLabour and Industrial
CourtMadhya Pradesh High Court
Decided On
Case NumberW.P. No. 5063/1999
Judge
Reported in(2000)IILLJ1427MP; 2000(3)MPHT343
ActsConstitution of India - Articles 226, 227, 323-A and 323-B; Madhya Pradesh High Court Rules - Rule 1; Madhya Pradesh Industrial Relations Act, 1960
AppellantKedia Distilleries Ltd.
RespondentChhattisgarh Chemical Mill Mazdoor Sangh and ors.
Cases ReferredL. Chandra Kumar v. Union of India and Ors.
Excerpt:
.....limited v. sumit usha martin finance limited and ors., that matter decided by tribunal goes to division bench - single judge referred to larger bench - hence, present reference - whether decision rendered in cases of neo sacks limited v. cegat, new delhi, and kedia distilleries limited v. sumit usha martin finance limited and ors., lay down correct law to effect that matters arising out of all tribunals are to be heard by division bench of present court or not? - held, as per decisions of case matter decided by those tribunal which is constituted under article 323 of constitution shall be referred to division bench but matter decided by those tribunal which is not constituted under article 323 of constitution shall be referred to single judge - reference answered accordingly -..........correct law to the effect that the matters arising out of all the tribunals are to be heard by a division bench of this court ?'2. the petition under articles 226 and 227 of the constitution of india is against the award made by the industrial court (bench at raipur), on a reference made by the state government under section 51(1) of madhy'a pradesh industrial relations act, 1960, which was placed before a single bench of this court as per the roster prepared by honourable the chief justice. it appears that the learned counsel for the petitioner-management raised an objection to the effect that according to the decision of a division bench of this court in the case of neo sacks limited v. cegat, new delhi, (supra) and in kedia distilleries limited v. sumit usha martin finance limited.....
Judgment:

Pandey, J.

1. This matter has been placed before this Full Bench on a reference made by one of us (Honourable DIPAK MISRA, J.) on the following question framed by him :

'Whether the decision rendered in the cases of Neo Sacks Limited v. CEGAT, New Delhi, 1999(114) ELT 826 (MP) and Kedia Distilleries Limited v. Sumit Usha Martin Finance Limited and Ors., L.P.A. No. 332/1999, decided on January 11, 2000, lay down the correct law to the effect that the matters arising out of all the Tribunals are to be heard by a Division Bench of this Court ?'

2. The petition under Articles 226 and 227 of the Constitution of India is against the award made by the Industrial Court (Bench at Raipur), on a reference made by the State Government under Section 51(1) of Madhy'a Pradesh Industrial Relations Act, 1960, which was placed before a single Bench of this Court as per the roster prepared by Honourable the Chief Justice. It appears that the learned counsel for the petitioner-management raised an objection to the effect that according to the decision of a Division Bench of this Court in the case of Neo Sacks Limited v. CEGAT, New Delhi, (supra) and in Kedia Distilleries Limited v. Sumit Usha Martin Finance Limited and Ors., L.P.A. No. 332/1999, decided on January 11, 2000 the matter cannot be heard by a single Judge. After hearing the learned counsel for the petitioner and other counsel mentioned in the orders, amicus curiae, the learned single Judge referred the above question for constitution of a larger Bench and that is how this matter comes before us.

3. From the facts indicated above, it is clear that the matter arose from an award passed by a Tribunal which was constituted under an enactment much prior to the 42nd amendment in the Constitution of India, whereby Articles 323A and 323B were added with effect from January 3, 1977, The Industrial Court, which delivered the award, under challenge in this case, is a Tribunal constituted under Madhya Pradesh Industrial Relations Act, 1960 It is obvious that it is a pre-existing Tribunal and was not constituted under Article 323B of the Constitution by the State Legislature.

4. The answer to the question framed, before us will depend upon if the view taken in the two cases-Neo Sacks Limited (supra) and Kedia Distilleries Limited (supra) is correct in holding that all the Tribunals constituted under Article 323A or under Article 323B of the Constitution are subjected to jurisdiction of a Division Bench of a High Court in view of the decision of the Supreme Court in the case of L. Chandra Kumar v. Union of India and Ors., reported in AIR 1997 SC 1125 : 1997 (3) SCC 261 : 1995-II-LLJ-640.

5. We have heard Sarvashri R.K. Gupta, Learned Counsel for the petitioner, Shri A.G. Dhande, Advocate with Shri Sujoy Paul, counsel for the respondent No. I and Shri Ajay Mishra, Deputy Advocate General, for the respondent No. 3-State. We also requested Shri G.M. Chaphekar and Shri P.S. Nair, Senior Counsel, who were present in the Court, amicus curiae, to address us on the question involved in this case. They kindly acceded to our request for which we are very grateful. All the counsel in this case, however, argued that the reference should be accepted.

6. The precise question for determination is - If the Constitution Bench of the Supreme Court in the case of L. Chandra Kumar (supra) directed that the matters arising out of orders passed by all the Tribunals irrespective of the fact that they were constituted under Article 323A or under Article 323B of the Constitution, should be heard by a Division Bench, or the directions of their Lordships were confined only to orders of those Tribunals which were specifically constituted under Article 323A or under Article 323B of the Constitution. It is, therefore, necessary to refer to the issues which were considered by the Constitution Bench. Thus, it would be apt to quote the broad issues outlined in paragraph 1 of that order as follows:

'(1) Whether the power conferred upon Parliament or the State Legislatures, as the case may be, by Sub-clause (4) of Clause (2) of Article 323A or by Sub-clause (d) of Clause (3) of Article 323B of the Constitution, to totally exclude the jurisdiction of 'all Courts', except that of the Supreme Court under Article 136, in respect of disputes and complaints referred to in Clause (1) of Article 323A or with regard to all or any of the matters specified in Clause (2) of Article 323B, runs counter to the power of judicial review conferred on the High Courts under Articles 226/227 and on the Supreme Court under Article 32 of the Constitution?

(2) Whether the Tribunals, constituted either under Article 323A or under Article 323B of the Constitution, possess the competence to test the constitutional validity of a statutory provision/rule?

(3) Whether these Tribunals, as they are functioning at present, can be said to be effective substitutes for the High Courts in discharging the power of juridical review If not, what are the changes required to make them conform to their founding objectives?'

It is apparent from the questions quoted above, that the Constitution Bench of the Supreme Court was required to consider if Sub-clause (d) of Clause (2) of Article 323A or Sub-clause (d) of Clause (3) of Article 323B of the Constitution, excluding the jurisdiction of all the Courts except that of Supreme Court under Article 136, altered the basic structure of the Constitution taking away the power of judicial review conferred upon the High Courts under Articles 226/227 and that of the Supreme Court under Article 32 of the Constitution of India. The second question is related to the power of the Tribunals constituted under Article 323A or under Article 323B to consider the constitutional validity of a Statute. The third question was whether these high power Tribunals are effective substitutes of High Courts in exercising their judicial power of review. The answers to the questions quoted above were summed up by their Lordships in paragraph 99 of the report, which is as follows:

'99. In view of the reasoning adopted by us, we hold that Clause 2(d) of Article 323A and Clause 3(d) of Article 323B, to the extent they exclude the jurisdiction of the High Courts, and the Supreme Court under Articles 226/227 and 32 of the Constitution, are unconstitutional. Section 28 of the Act and the 'exclusion of jurisdiction' clauses in all other legislations enacted under the aegis of Articles 323A and 323B would to the same extent, be unconstitutional. The jurisdiction conferred upon the High Courts under Articles 226/227 and upon the Supreme Court under Article 32 of the Constitution is a part of the inviolable basic structure of our Constitution. While this jurisdiction cannot be ousted, other Courts and Tribunals may perform a supplemental role in discharging the powers conferred by Articles 226/227 and 32 of the Constitution. The Tribunals created under Article 323A and 323B of the Constitution are possessed of the competence to test the constitutional validity of statutory provisions and rules. All decisions of these Tribunals will, however, be subject to scrutiny before a Division Bench of the High Court within whose jurisdiction the Tribunal concerned falls. The Tribunals will, nevertheless, continue to act like Courts of first instance in respect of the areas of law for which they have been constituted. It will not, therefore, be open for litigants to directly approach the High Courts even in cases where they question the views of statutory legislations (except where the legislation which creates the particular Tribunal is challenged) by overlooking the jurisdiction of the Tribunal concerned. Section 5(6) of the Act is valid and constitutional and is to be interpreted in the manner we have indicated.'

7. It is apparent from the foregoing paragraphs of this opinion that their Lordships of the Supreme Court were considering the questions related to the Tribunals constituted under Article 323A or under Article 323B of the Constitution. Their Lordships were not considering the powers of the High Courts under Articles 226/227 of the Constitution of that the Supreme Court vis-a-vis other Tribunals which were not constituted under the aforesaid Articles. The pre-amendment enactments which were framed by virtue of the powers conferred by the appropriate entry in the List conferring legislative competence could not have ousted the jurisdiction of the High Courts under Articles 226/227 of the Constitution or that of the Supreme Court under Article 32 of the Constitution because prior to framing of Articles 323A or Article 323B no such power existed. The law declared by the Supreme Court in the case of L. Chandra Kumar (supra) is that the power of judicial review is a part of basic structure of the Constitution and it could not be altered, amended or abridged even by amendment in the Constitution by Parliament and, therefore, Clause 2(d) of Article 323A and Clause 3(d) of Article 323B are unconstitutional so far as they alter the basic structure of the Constitution by impinging upon the power of review of the High Court conferred by the Constitution under Articles 226/227 and that of the Supreme Court under Article 32. The necessary corollary from this decision was that Section 28 of the Administrative Tribunals Act was ultra vires and it was so declared by the Supreme Court so far as it restricts the power of review of the High Courts as well as of the Supreme Court as stated above.

8. The Constitution Bench of the Supreme Court was further of the opinion that high powered Tribunals constituted by Parliament under Article 323A of the Constitution and by the appropriate legislation under Article 323B of the Constitution, possess the competence to test the constitutional validity of a statutory provision. In other words, these Tribunals can declare a law or a rule ultra vires of the Constitution. Their Lordships expressly replied the contention that these statutory Tribunals should not be given the power to declare a law ultra vires of the Constitution. It appears that in rendering this opinion their Lordships were guided by the power conferred on Parliament by Article 32(3) of the Constitution which specifically provides that the Parliament shall have power to frame a law empowering any other Court to exercise all or any of the powers conferred on the Supreme Court under Clause (2) of Article 32 within the local limits of its jurisdiction. This point was taken by Mr. K.K. Venugopal, representing the State of West Bengal as is apparent from paragraph 46 of the judgment. The point has been dealt with by Supreme Court in paragraph 81 of its judgment by saying that if the Parliament could confer a power on any other Court under Article 32(3) to exercise the power of the Supreme Court under Article 32(2), there is no reason that this power of testing the constitutional validity of an enactment or a rule cannot be exercised by the Tribunals constituted pursuant to Articles 323A and 323B of the Constitution. The Supreme Court was further of the opinion that the Tribunals constituted under the aforesaid Articles, need not be abolished as suggested by Malinath Committee. It was held that the Tribunals shall continue to act as the Courts of first instance in respect of the area for which they have been constituted. The litigants, therefore, shall be required to approach those Tribunals first and it shall not be open for them to approach the High Court directly even in cases where the question of vires of statutory legislation was concerned. The only exception where the litigants could approach the High Court directly, was where the legislation which created a particular Tribunal, was being challenged. Having held that the powers conferred on the High Courts under Articles 226/227 of the Constitution of India, was part of the basic structure of the Constitution. Their Lordships further directed in the aforesaid judgment that the decision of the Tribunals aforesaid could be questioned before a Division Bench of High Court within whose jurisdiction the Tribunal existed. It appears that this view was taken by the Supreme Court because their Lordships were of the opinion that basically, these Tribunals, constituted pursuant to enactment under Article 323A or under Article 323B of the Constitution, were exercising supplemental functions which were vested in the various High Courts prior to their constitution.

9. Having summed up the law laid down in the case of L. Chandra Kumar (supra), the stage has reached to consider the decision of this Court in the case of Neo Sacks Limited (supra). It appears from the judgment in that case that the orders passed by the Customs, Excise and Gold (Control) Appellate Tribunal (for short the CEGAT) were challenged before the High Court of Madhya Pradesh (Indore Bench) by way of two writ petitions. In that case, it was argued that the judgment of the Supreme Court rendered in L. Chandra Kumar's case (supra) did not cover the CEGAT. It was further contended that the High Court of Madhya Pradesh had no jurisdiction as the Delhi High Court had the territorial jurisdiction to decide the case. It was further contended that the two petitions were liable to be rejected on the ground that the Section 352 of the Excise Act provided an alternative remedy. The Division Bench of this Court, after considering the judgment of the Supreme Court, held that the power of judicial review under Articles 226/227 of the Constitution was part of the basic structure of the Constitution, and so also that of the Supreme Court under Article 32 thereof. Therefore, following the decision of the Supreme Court in L. Chandra Kumar's case (supra) it held that even in those cases where the orders of the CEGAT were under challenge the High Court was competent to exercise powers under Articles 226/227 of the Constitution. In fact, the CEGAT is not constituted pursuant to powers conferred under Article 323B of the Constitution and, therefore, the Division Bench rightly came to the conclusion that the powers of the High Court under Articles 226/227 of the Constitution should not have been taken away and were exercisable against an order passed by the CEGAT. The Division Bench further held that it had the territorial jurisdiction to decide the writ petitions in terms of Articles 226/227 of the Constitution and the alternative remedy was no bar to exercise that power. However, while dealing with the question involved in this writ petition the Division Bench went on to hold that the Supreme Court had decided that a Division Bench of the High Court shall consider all writ petitions filed under Articles 226/227 of the Constitution against any order passed by a Tribunal whether constituted pursuant to Article 323A or Article 323B of the Constitution, or not. The following question in paragraph 9 of the order passed by the Division Bench shows what was stated by it. Referring to Supreme Court's decision the Division Bench held:

'9......It further affirms the power of judicial superintendence of the High Courts over the decisions of Tribunals, whether or not created under Article 323A or Article 323B of the Constitution and makes these subject to judicial scrutiny before a Division Bench of the High Court.......'

However, in paragraph 10, the Division Bench itself extracted the judgment of the Supreme Court from paragraphs 91 and 92 as follows:

'Having regard to both the above settled contentions, we hold that all decisions of Tribunals, whether created pursuant to Article 323A or Article 323B of the Constitution, will be subject to the High Court's writ jurisdiction under Articles 226/227 of the Constitution, before a Division Bench of the High Court within whose territorial jurisdiction the particular Tribunal falls.

In the view that we have taken no appeal from the decision of a Tribunal will directly lie before the Supreme Court under Article 136 of the Constitution, but instead, the aggrieved party will be entitled to move the High Court under Articles 226/227 of Constitution and from the decision of the Division Bench of the High Court the aggrieved party could move this Court under Article 136 of the Constitution.'

10. It appears to us that the Division Bench has put a gloss upon the decision of the Supreme Court. The decision of the Supreme Court was specifically referred to which stated that 'the Tribunals, whether created under Article 323A or under Article 323B of the Constitution, will be subject to the High Court's writ jurisdiction under Articles 226/227 of the Constitution before a Division Bench.' It was not said by the Supreme Court in respect of any other Tribunal except those constituted either under Article 323A or under Article 323B of the Constitution. The word 'or' which separates Articles 323A and 323B in the judgment of the Supreme Court does not support the construction put upon it by the Division Bench. The judgment of the Supreme Court in L. Chandra Kumar 's case (supra) was confined to the Tribunal constituted under Article 323A or under Article 323B of the Constitution, and in that context, these observations were made. We are, therefore, firmly of the view that the interpretation put upon the direction of the Supreme Court, if we say so with great respect, does not follow from that case. However, by putting this construction that the decisions of Tribunals whether or not created under Article 323A or under Article 323B of the Constitution, the Division Bench in the case Neo Sacks Limited (supra) bound the other single Benches of this Court on the theory of precedents to hold that all the decisions of all the Tribunals whether they were created under Article 323A or under Article 323B of the Constitution, or not, shall be heard by a Division Bench of this Court.

11. As a sequel to this case, in the case of Kedia Distilleries Limited (supra), the learned single Judge of this Court (Indore Bench) felt himself bound by the decision of the Division Bench in the case of Neo Sacks Limited (supra) and held that the single Bench had no jurisdiction to hear a writ petition against an order passed by the Appellate Authority for Industrial and Financial Reconstruction, referring the order of Board for Industrial and Financial Reconstruction under Sick Industrial Companies (Special Provisions) Act, 1985. The petitioner-company filed a Letters Patent Appeal against the order of the learned single Judge. However, Honourable the Chief Justice had ordered to put up the writ petition before a Division Bench. In the Letters Patent Appeal, the Division Bench confirmed the view taken by the earlier Division Bench in the case of Neo Sacks Limited (supra), that all the petitions filed against the order of the Tribunal shall be heard by a Division Bench. However, it also took the view that since the writ petition has already been placed before the Division Bench by Honourable the Chief Justice, there is no reason to interfere with the order of the learned single Judge. The third reason advanced was that the order of learned single Judge did not amount to judgment and, therefore, no appeal lay under Clause 10 of Letters Patent. We are not concerned here with the last two reasons advanced by the Division Bench in the case of Kedia Distilleries Limited (supra). However, for the reasons already given, we feel that the, conclusion of the second Division Bench that all the petitions against any Tribunal whether or not constituted under Article 323A or under Article 323B shall be heard by a Division Bench, also appears to be incorrect. We reiterate that as per the directions given by the Supreme Court, only those cases which arise from the orders of the Tribunals, constituted pursuant to either Article 323A or under Article 323B of the Constitution, shall be heard by a Division Bench and to that extent we overrule both the cases of Neo Sacks Limited (supra) and Kedia Distilleries Limited (supra).

12. We also make it clear that this opinion delivered by us, is confined to the interpretation of L. Chandra Kumar's case (supra) and it shall not be taken to lay down the law wider than what has been referred to this Full Bench by one of us. (Honourable DIPAK MISRA, J.).

13. We have given our anxious consideration to the question referred to this Full Bench by one of us (Honourable DIPAK MISRA, J.) and have given reasons for our conclusion on account of the respect and regard which we accord to the members of the Bench who constituted the two Division Benches, although all the learned counsel appearing before us in this petition, stated in one voice that the case of L. Chandra Kumar (supra) was not rightly interpreted by the two Division Benches.

14. The answer to the question given by us is that the two Division Benches in Neo Sacks Limited (supra) and Kedia Distilleries Limited (supra) did not decide the decision of the Supreme Court in L. Chandra Kumar's case (supra) covers the cases of Tribunals whether constituted under Article 323A or Article 323B of the Constitution and consequently, the writ petition against the orders passed by Tribunals other than constituted under Article 323A and Article 323B too shall be heard by a Division Bench. The correct view is that the Supreme Court made direction only in respect of those Tribunals which are constituted pursuant to either Article 323A or Article 323B of the Constitution. Accordingly, a single Judge of this Court can hear and dispose of the petitions under Articles 226 and 227 of the Constitution of India which arise from the orders passed by the Tribunals other than those constituted by an enactment pursuant to Article 323A or Article 323B of the Constitution, in accordance with current roster prepared under the directions of Honourable the Chief Justice as per Section 1, Rule 1(a) of Chapter I of Madhya Pradesh High Court Rules and orders.

15. The Registry, accordingly, shall list this petition before an appropriate single Bench of this Court in the light of the opinion rendered by us.


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