Appeal No 375 of 1976
Appeal by Special Leave from the Judgment and Order dated 7111975 of the High Court at New Delhi in Civil Writ No 1123 of 1975 GB Pai OC Mathur and DN Mishra for the appellant
MK Ramamurthi SC Jain and Madan Mohan for respond ent No 1
The Judgment of the Court was delivered by SARKARIA J
The principal question that arises in this appeal by special leave is Whether an order of the Labour Court to the effect that since no demand of the workmen had been served on the employer no industrial dispute had come into existence in accordance with law and as such the Reference was invalid and the Court had no jurisdiction to adjudicate the matter referred to it by the Government is an award for the purposes of Section 19 of the  for short called the Act Cox  Kings Agents Ltd for short the Management dismissed from service three of their workmen after a domes tic enquiry conducted against them on certain charges
In May 1967 the Lt Governor of Delhi made a Refer ence under section 10 read with section 125 of the Act to the Labour Court Delhi to determine Whether the terminations of services of SShri HS Rawat Bidhi Chand and Ram Sarup Gupta were unlawful and unjustified and if so to what relief are these workmen entitled By an amendment of their written statement in February 1969 augmented by an application dated 1781971 the Management raised a preliminary objection that since no demand notice had been served on the Management no indus trial dispute had legally come into existence and as such the Reference was invalid and the Labour 334 Court had no jurisdiction to adjudicate it
By an order dated September 27 1972 the Labour Court accepted the objection holding  that no industrial dispute came into existence before this reference as the workmen have failed to establish serving of demand on the management prior to this reference
The effect of this finding is that the reference could not have been made for adjudication and the same is accordingly invalid and hence the question of deciding the issue as in the reference or other issues does not arise as the industrial dispute under reference did not come into existence in accordance with law before this reference
This award is made accordingly
 Thereafter the workmen on 25101972 raised a dispute by serving demand notices on the Management
By his order dated 251973 the Lt Governor Delhi again made a Refer ence to the Labour Court under the Act for adjudication of the same matter relating to the termination of the services of the aforesaid workmen
The Management raised inter alia a preliminary objec tion that a second Reference within one year of the first award  dated September 27 1972 was not competent in view of what is contained in sec
19 of the Act
By an order dated 251973 the Labour Court dismissed the preliminary objections
After recording the evidence produced by the parties the Court held on merits that the termination of the services of 3 workmen was illegal and unjustified
The Court further found that Bidhi Chand work man had become gainfully employed elsewhere as a driver with better emoluments and it was therefore sufficient to award him compensation without any relief of reinstatement at the rate of 50 of his wages for three years from 1966 to 1969 to the date of his getting employment elsewhere
It further found that Ram Sarup Gupta had remained unemployed after his dismissal in 1966
It therefore directed his reinstatement with full back wages and continuity of serv ice
As regards HS Rawat the Court found that he could not have remained unemployed throughout but was doing some work or the other for his living may be with occasional spells
The Court therefore held that Rawat was entitled to reinstatement and continuity of service with 50 back wages till the award Came into operation and he got his reinstate ment
This award was made by the Labour Court on 1 5 1975
The Management impugned this award by filing a writ petition under article 226 of the Constitution in the High Court of Delhi
Only three contentions were canvassed by the Management at the preliminary heating before the High Court i That the determination dated 2791972 by the Labour Court was an award  as defined in section 2b of the Act and in view of sub section
3 of section 19 it had to be in operation for a period of one year
It could be terminated only by a notice given under sub sections
4  6 of section 19
Since no such notice was given the award continued to be in operation
The second award dated 1 5 1975 could not be validly made during the period the 335 first award was in operation ii The demand for reinstate ment was not made by the workmen till 1972 and the Labour Court was not justified in awarding them the relief of reinstatement together with compensation for back wages from 1966 onwards iii The onus to show that the workmen had not obtained alternative employment after their dismissal was on the workmen and this onus has not been discharged
On the other hand the Labour Court wrongfully did not permit the Management to adduce additional evidence to show that the workmen had obtained alternative employment and in consequence were not entitled to back wages
Regarding i the High Court held that since the award  dated 2791972 was not one which imposed any continuing obligation on the parties but had ended with its pronouncement nothing in subsections 3 and 6 of sec
19 was applicable to it
As regards ii the High Court held that once the dismissal of the workmen was found illegal it was inevita ble to award the compensation from the dates of dismissal till they found alternative employment or till the date of the award as the case may be
In regard to iii the High Court said that the ques tion of burden of proof as to who is to prove whether the workmen did not get alternative employment for the period for which back wages have been awarded to them could arise only if no evidence was given by either party or if the evidence given by them was evenly balanced
Neither of these circumstances was present before the Labour Court and there was no good reason to disturb the finding of fact recorded by the Labour Court on this point
The High Court thus rejected all the three contentions and in the result dismissed the writ petition in limine with a speaking order
Hence this appeal
Shri GB Pai has reagitated all the three points before us
He assails the findings of the High Court thereon
Regarding point No i Mr Pai s argument is that the determination dated 2791972 also was an award  within the second part of the definition of the term in a 2b of the Act inasmuch as it determined a question relating to an industrial dispute
Emphasis has also been laid on the point that this award  dated 2791972 was duly published by the Government under section 171 and had assumed finality under sub section
2 of the same section
This award dated 2791972 proceeds the argument had to remain operative under sub section
3 of section 19 for a period of one year from the date on which it became enforceable under section 17A ie a date one month after its publication
It is submitted that no second Reference could be validly made by the Government during the period the first award remained operative and since the second Reference dated 251973 was made before the expiry of such period of the first award which had not been terminated in the manner laid down in section 19 it was invalid and the consequential adjudication by the Labour Court on its basis was null and void
In this connection counsel has relied upon a 7 436SCI77 336 judgment of this Court in Management of Bangalore Woollen Cotton  Silk Mills Co Ltd
vs The Workmen and ant1 wherein it was held that when there is a subsisting award binding on the parties the Tribunal has no jurisdiction to consider the same points in a fresh reference
In that case the earlier award had not been terminated and the Reference was therefore held to be incompetent
Reference has also been made to a single Bench Judgment of the Allaha bad High Court in Workmen of Swadeshi Cotton Mill Co Ltd v Swadeshi Cotton Mills Co Ltd Kanpur and ors
2 As against this Shri MK Ramamurthi maintains that the Labour Court s order dated May 1 1972 was not an award  within the definition of the term in s 2b inasmuch as it was not a determination on merits of any industrial dis pute or of any question relating to an industrial dispute
In this connection reliance has been placed on a judgment of this Court in Civil Appeal No 241 of 1964 Technological Institute of Textiles vs Its Workmen and ors3
Before dealing with the while to notice the relevant conten tions canvassed it will be worthwhile to notice the rele vant statutory provisions
The terms award  and industrial dispute  have been defined in the Act as follows Award  means an interim or a final determination of any industrial dispute or of any question relating thereto by any Labour Court Industrial Tribunal or National Indus trial Tribunal and includes an arbitration award made under section 10A
vide section 2 b
Industrial dispute means any dispute or difference between employers and employers or between employers and workmen or between workmen and workmen which is connected with the employment or non employment or the terms of employment or with the conditions of la bour of any person vide section 2 k
Section 10 describes the matters which can be referred to Boards Courts or Tribunals for adjudication
Only clause i of subsection 1 is material for our purpose
It provides Where the appropriate Government is of opin ion that any industrial dispute exists or is apprehended it may at any time by order in writing a b  c refer the dispute or any matter appear ing to be connected with or relevant to the dispute if if relates to any 1  2 42 Indian Factories Journal p 255
3 337 matter specified in the Second Schedule to a Labour Court for adjudication
Sub section 4 requires the Labour Court to confine its adjudication to those points of dispute and matters incidental thereto which the appropriate Government has referred to it for adjudication
The material part of section 19 reads as under 1  2  3 An award shall subject to the provi sions of this section remain in operation for a period of one year from the date on which the award becomes enforceable under section 17A Provided that the appropriate Government may reduce the said period and fix such period as it thinks fit Provided further that the appropriate Govern ment may before the expiry of the said peri od extend the period of operation by any period not exceeding one year at a time as it thinks fit so however that the total period of operation of any award does not exceed three years from the date on which it came into operation
4 Where the appropriate
Government Whether of its own motion or on the application of any party bound by the award considered that since the award was made there has been a material change in the circumstances on which it was based the appropriate Government may refer the award or a part of it to a Labour Court if the award was that of a Labour Court or to a Tribunal if the award was that of a Tribunal or of a National Tribunal for decision whether the period of operation should not by reason of such change be shortened and the decision of Labour Court or the Tribunal as the case may be on such reference shall be final
5 Nothing contained in sub section 3 shall apply to any award which by its nature terms or other circumstances does not impose after it has been given effect to any continuing obligation on the parties bound by the award
6 Notwithstanding the expiry of the period of operation Under sub section 3 the award shall continue to be binding on the parties until a period of two months has elapsed from the date on which notice is given by any party bound by the award to the other party or parties intimating its intention to terminate the award
338 7 No notice given under sub section 2 or sub section 6 shall have effect unless it is given by a party representing the majority of persons bound by the settlement or award as the case may be
 There is no dispute that the order on the earlier Refer ence was made by the Labour Court on 27 9 1972 while the second Reference with the same terms of Reference to that Court was made by the Government on 251973 ie within one year of the earlier order
It is common ground that the period of one year for which an award normally remains in operation under sub section
3 was not reduced or curtailed by the Government under sec
19 or under any other provision of the Act
It is further admitted between the parties that no notice was given by any party of its intention to terminate the Order dated 2791972
The controversy with regard to the first point there fore narrows down into the issues whether the determination dated 2791972 of the Labour Court was an award as defined in section 2b of the Act The definition of award in section 2b falls in two parts
The first part covers a determination final or interim of any industrial dispute
The second part takes in a determi nation of any question relating to an industrial dispute
But the basic postulate common to both the parts of the definition is the existence of an industrial dispute actual or apprehended
The determination contemplated by the definition is of the industrial dispute or a question relating thereto on merits
It is to be noted further that Sec 2 itself expressly makes the definition subject to anything repugnant in the subject or context
We have therefore to consider this definition in the context of sec
19 and other related provisions of the Act
Mr Pai concedes that the order dated 2791972 is not a determination of any industrial dispute as such falling under the first part of the definition
However Iris argument is that the expression any question relating there to in the second part of the definition is of wide ampli tude and should be spaciously construed
It is main tained that a question whether or not an industrial dispute exists will itself be a question relating to an industrial dispute within the tendment of the second part of the defi nition
The contention appears to be attractive but does not stand a close examination
Sub section 1 of sec
10 indicates when and what matters can be referred to the Labour Court for adjudica tion
The sub section expressly makes formation of opinion by the appropriate Government that any industrial dispute exists or is apprehended a condition precedent to the exercise of the power of making a Reference
Subsection 4 gives a mandate to the Labour Court to confine its adjudication to those points of dispute which have been specified in the Order of Reference or are incidental thereto
From a conjoint reading of clb of section 2 and sub section 1 and 4 of sec
10 it is 339 clear that in order to be an award  within the second part of the definition a determination must be i an adjudica tion of a question or point relating to an industrial dis pute which has been specified in the Order of Reference or is incidental thereto and ii such adjudication must be one on merits
Now let us test the Labour Court s order dated 27972 in the light of the above enunciation
That Order did not satisfy any of the criteria indicated above
It did not determine the questions or points specified in the Govern ment Order of Reference
Nor was it an adjudication on merits of any industrial dispute or a question relating thereto
The only question determined by the Order dated 2791972 was about the existence of a preliminary fact viz existence of an industrial dispute which in the Labour Court s opinion was a sine qua non for the validity of the Reference and the exercise of further jurisdiction by the Court
Rightly or wrongly the Court found that this preliminary jurisdictional fact did not exist because no industrial dispute had come into existence in accordance with law and in consequence the Reference was invalid and the Court was not competent to enter upon the Reference and determine the matter referred to it
With this find ing the Court refused to go into the merits of the question referred to it
There was no determination on merits of an industrial dispute or a question relating thereto
We are therefore of opinion that Labour Court s determination dated 2791972 did not possess the attributes essential to bring it within the definition of an award
The mere fact that this order was published by the Government under section 171 of the Act did not confer that status on it
In the view we take we are fortified by the principle laid down by this Court in Technological Institute of Tex tiles vs Its Workmen supra
In that case there was a settlement which in the absence of necessary formalities was not binding on the parties
Certain items of dispute were not pressed and withdrawn under the terms of such settlement
In the subsequent reference before the Indus trial Tribunal some of the items of dispute were withdrawn and no award was made in respect thereto
Thereafter these items were again referred for adjudication along with cer tain other matters to the Tribunal
It was contended on behalf of the Management that subsequent reference with regard to the items which had been withdrawn and not pressed in the earlier reference was barred under sec
19 because the earlier award had not been terminated in full
Ramaswa mi J speaking for the Court repelled this contention with these observations It is manifest in the present case that there has been no adjudication on merits by the industrial tribunal in the previous reference with regard to the matters covered by items 1 and 3 of the present reference because the workmen had withdrawn those mat ters from the purview of the dispute
There was also no settlement in exhibit R 4 because the demands in question had been withdrawn by the workmen and there was no agreement between the parties 340 in regard thereto
Our conclusion therefore is that the bar of section 19 of the does not operate with regard to the matters covered by items 1 and 3 of the present reference and the argument put forward by the appellant on this aspect of the case must be rejected Although the facts of the case before us are different yet the principle enunciated therein viz that the bar of sec
19 operates only with regard to a determination made on merits is fully applicable
By any reckoning the decision dated 2791972 of the Labour Court by its very nature did not impose any continuing obligation on the parties bound by it
This was an additional reason for holding that the earlier reference was not barred by anything contained in sub section 3 or other provisions of section 19
We have gone through the single Bench decision of the Allahabad High Court in Workmen of Swadeshi Cotton Mills Co Ltd case supra
That decision is to the effect that the finding recorded by the Labour Court that the matter re ferred to it for adjudication was not an industrial dispute as defined in the Act is itself a determination of a ques tion relating to an industrial dispute and would fall within the definition of the term award under the Act
In our opinion
this is not a correct statement of the law on the point
The next submission of Mr Pai is that since the demand for reinstatement was not duly made by the workmen before 2810
1972 the Courts below were not justified in award ing to the workmen compensation for back wages from 1966 onwards
On the other hand Mr Ramamurthi maintains that such a claim was presumably agitated by the workmen in proceedings before the Conciliation Officer in 1966
While conceding that technically no demand notice for reinstatement was served by the workmen on the Management before 2510
1972 Counsel submits that the Management were aware of the work men s claim to reinstatement since 1966 and in these circumstances the Management should not be allowed to take shelter behind this technical flaw and deny just compensa tion to them from the date of wrongful dismissal
We have carefully considered the contentions advanced on both sides
After taking into consideration all the circum stances of the case we are of opinion that the Labour Court was not justified in awarding compensation to the workmen for wages relating to the period prior to 25101972 ie the date on which the demand notices for reinstatement were served on the Management
To this ex tent we would accept the contention of the appellants
341 The third contention of the appellants is that the onus of proving that they had not obtained alternative employment elsewhere after the termination of their services was on the workmen and they had failed to discharge that onus
We find no merit in this contention
The question of onus oft loses its importance when both the parties adduce whatever evidence they had to produce
In the instant case both the parties led their evidence and closed their respective cases
Subsequently at a late stage the Management made an application for adducing additional evidence
The Labour Court declined theft appli cation
The High Court found and we think rightly no good reason to interfere with the discretion of the Labour Court
It may be remembered further that this appeal arises out of a petition under article 226 of the Constitution and in the exercise of that special jurisdiction the High Court does not reopen a finding of fact based on legal evidence
The findings of the Labour Court to the effect that after their dismissal Ram Swamp Gupta was unable to find any alternative employment elsewhere while Rawat was able to find only intermittent employment elsewhere were based on evidence produced by the parties
The High Court was there fore right in not interfering with those findings of fact
Lastly it was urged by Mr Pai that the employers had lost confidence in the employees and therefore compensa tion without reinstatement would have been adequate re lief
It is submitted that the business of the employers is that of Travel Agents and such a sensitive business can be successfully carried on only with the aid of employees whose fidelity and integrity is beyond doubt
It is stressed that the employees of the appellants have to handle daily lot of cash received from their clients in the discharge of their duties
It is pointed out that the charge against HS Rawat was one of misappropriation of such funds and this charge was established in the domestic enquiry
The Labour Court proceeds the argument did not displace that finding of the domestic Tribunal but ignored it on the ground that the charge was stale and had been condoned
In short the argument is that the employers had lost confidence in this employee who could no longer be entrusted to perform sensitive jobs on behalf of the Management without detriment to its business
We are unable to accept this contention
Firstly this point was not argued before the High Court
Secondly the observations of the Labour Court read as a whole show that in its opinion the charge of misap propriation of funds had not been proved against HS Rawat
This is what the Labour Court said on the point I am therefore of opinion that the charges had been condoned and they could not be revived again and the act of reviving the charge on account of his Union activities was an act of unfair labour practice on the part of the Management and amounted to victimisation
Even the 342 charges in the charge sheet exhibit M5 have not been established before me that the workman withdrew the funds from the company on false pretences for revenue stamps and misappropri ated the same
 Thus there is no factual basis for this belated conten tion and we repel the same
For the foregoing reasons we dismiss this appeal with the modification that in addition to the relief of rein statement with continuity of service SShri HS Rawat and Ram Swarup Gupta shall be entitled to 50 and full back wages respectively from 25101972
It may be recalled that the special leave to appeal in this case was granted on the condition that the appellants shall pay the costs of this appeal to the respondents in any event
We order accordingly
PBR Appeal dismissed


Summary:
The term Award  has been defined by section 2b of the to mean an interim or a final determination of any industrial dispute or of any question relating thereto by a Labour Court
Section 10 which describes the matters that can be referred to a Labour Court etc
for adjudication provides in sub s1 that where an appropriate government is of opinion that any industrial dispute exists or is apprehended it may at any time by order in writing c refer the dispute or any matter appearing to be connected with or relevant to the dispute if it relates to any matter specified in the second sched ule to a Labour Court for adjudication
Under section 193 an award shall remain in operation for a period of one year from the date on which the award becomes enforceable under section 17A An industrial dispute relating to the dismissal of three workmen of the appellant had been referred to a Labour Court
The Labour Court held that the reference was in valid because as the workmen had not served demand notice on the management prior to the reference no industrial dispute could legally come into existence before the refer ence
After serving a demand notice on the management within a month thereafter the workmen raised an industrial dispute relating to the same matter
The Labour Court rejected the employer s preliminary objection that in view of section 19 the second reference was not competent in that it was made within one year of the first award and decided the case on merits
The Labour Court held that the termination of the services of the workmen was illegal and ordered reinstatement with back wages from the date of termination
The employer s writ petition under article 226 of the Constitution impugning the Labour Court s decision was dismissed by the High Court
Dismissing the appeal HELD The Labour Court s determination in the first reference did not possess the attributes essential to bring it within the definition of an award
The mere fact that this order was published by the Government under section 171 did not confer that status on it
339 D 1a The definition of award  under section 2b falls in two parts i determination final or interim of any indus trial dispute and ii of any question relating to an indus trial dispute
The basic postulate common to both the parts of the definition is the existence of an industrial dispute actual or apprehended
The determination  contemplated by the definition is of an industrial dispute or a question relating thereto on merits
338 D b In the instant cases the order of the Labour Court in the first reference did not determine the question or points specified in government order of reference nor was it an adjudication on merits of any industrial dispute or a question relating thereto
The only question determined by the Labour Court was about the existence of an industrial dispute which in its opinion was a sine qua non for the validity of the reference
Rightly or wrongly it found that this preliminary jurisdictional fact did not exist because no industrial dispute had come into existence in accordance with law and in consequence the reference was invalid
There was therefore no determination of the dispute on merits on the question relating thereto
339 C D 333 Technological Institute of Textiles vs Its Workmen and Ors  followed
Management of Bangalore Woollen Cotton  Silk Mills Co Ltd vs The Workmen and Anr   referred to
Workmen of Swadeshi Cotton Mills Co Ltd vs Swadeshi Cotton Mills Co Ltd Kanpur and Ors
42 Indian Factories Journal p 255 not approved
b Moreover the decision of the Labour Court in the first reference did not impose any continuing obligation on the parties bound by it
The second reference was there fore not barred by anything contained in sub section 3  or other provisions of section 19
340 C 2
The Labour Court was not justified in awarding com pensation to the workmen for wages relating to the period prior to the date on which the demand notice for reinstate ment was served on the management
340 H