Civil Appeals Nos
1721 1728 of 1969
Appeals by Special Leave from the Judgment and order dated the 2nd May 1962 of the Patna High Court of Judicature at Patna in MJC Nos 475 and 498 of 1959
A B N Sinha B P Maheshwari and Suresh Sethi for the Appellants in both the appeals
B C Ghose section section Jauhar D N Pandey A Sinha and D P Mukherjee for Respondent 1 In CA 1727 and Respondents 1 3 In CA 1728
D P Singh section C Agarwal and V J Francis for respondents 7 and 8 In CA 1727 and Respondent 4 in 172869
The Judgment of the Court was delivered by KRISHNA IYER J
We permit ourselves a few preliminary observations disturbingly induced by the not altogether untypical circumstances of these two appeals before proceeding to state the facts set out the submissions and decide the points
Industrial law in India has not fully lived up to the current challenges of industrial life both in the substantive norms or regulations binding the three parties the States Management and Labour and in the processual system which has baulked by dawdling dysfunction early finality and prompt remedy in a sensitive area where quick solution is of the very essence of real justice
The legislative and judicial processes have promises to keep if positive industrial peace in tune with distributive economic justice and continuity of active production were to be accomplished
The architects of these processes will we hopefully expect fabricate creative changes in the system normative and adjectival
The two appeals before us passported by special leave under article 136 relate to an industrial dispute with its roots in 1948 meandering along truce union rivalry and the like into strikes and settlements the last of which led to an arbitration award in 1959 which in turn prompted two writ petitions before the High Court
After a spell of a few years they ripened into a judgment
Appeals to this Court followed and after long gestation of six years for preparation of papers and a 15 like period the cases are ready for final hearing or parturition in all 12 years after the grant of leave
By this cumulative lapse of time the generation of workers who struck work two decades ago have themselves all but retired the representative Union itself which sponsored the dispute has the other side faintly states ceased to command representative character the Managements themselves have out of many motives disclaimed the intention to recover the huge sums awarded to them by the arbitrators and the only survival after death as it were is a die hard litigation tied up to a few near academic but important legal points for adjudication by the highest Bench On this elegiac note we will enter the relevant area of facts and law since we must decide cases brought before us however stale the lis
At this stage we may mention our strong feeling that where the superior courts after hearing full arguments are clearly inclined to affirm the judgment under appeal for substantially similar reasons as have weighed with the lower Court there is no need to give lengthy reasons for dismissing the appeal
Brevity except in special cases may well fill the bill where the fate is dismissal
On this score we are disposed to make short shrift of the appeals with stating but the necessary facts and focusing on the larger legal facets
Nevertheless the significance and plurality of the points pressed have defeated condensation
D The facts Two connected managements of industries in the same locality who figure as appellants before us had a running industrial dispute with their workers which has had a long history moving in a zigzag course and sicklied over by alleged internecine trade union strife
There were two trade unions which were perhaps of competitive strength and enjoying recognition
One of them the Rohtas Industries Mazdoor Sangh for short the Mazdoor Sangh was the representative union during the relevant period while the other the Rohtas Industries Seva Sangh for brevity the Seva Sangh is not a party before this Court and so we are not concerned with it except for the purpose of noticing its presence in the settlement of the dispute which starts the story so far as the litigation is concerned
There was a strike in the Industry for our purposes this expression embraces both the appellants which came to an end by virtue of a memorandum of agreement dated October 2 1957 to which not merely the management but also the two registered unions aforementioned and the two unregistered unions which had a lesser following were party
The terms of the said agreement provided inter alia that  The employees  claim for wages and salaries for the period of strike and the company s claim for compensation for losses due to strike shall be submitted for arbitration of Sri J N Majumdar and Sri R C Mitter ex High Court Judges and Ex Members of the Labour Appellate Tribunal of India as joint arbitrators and their decisions on the two questions shall be final and binding on all the parties Clause 7 of agreement 16 This agreement was admittedly arrived at during conciliation proceedings contemplated by the for short the Act and the reference to arbitration spelt out in clause 7 directly and
admittedly fell under section 10A of the Act
It is apparent that the arbitrators were seized of two questions a the claim of the workers for wages for the period of strike and b the claim of the management for compensation for its losses flowing from the strike
The Board of arbitrators two retired Judges of the Calcutta High Court held extensive hearings spread over a year and a half made a lengthy award marshalling the evidence adducing the reasons discussing the law and recording its decision on the two vital issues
At the end of the detailed and reasoned record of conclusions the award runs thus  Our award accordingly is 1 That the workmen participating in the strike are not entitled to wages and salaries for the period of the strike
2 That the company do recover from the workmen participating in the strike compensation assessed at Rs 80000rupees eighty thousand
3 That the workmen jointly and severally do pay to the company one eighth of the total costs of the arbitration
In default of payment the company will be at liberty to recover the same in such manner as it thinks fit
Subject to this the parties do bear their respective costs
 The workmen were deprived of their wages during the period of the strike on the score that it was an illegal strike
Both sides seem to have accepted this finding after an unsuccessful challenge in the High Court and happily industrial peace is said to be prevailing currently
What did hurt the Mazdoor Sangh more and what the management did try to have and to hold as a bonanza was the second finding that the strikers apart
from forfeiting wages do pay compensation in the huge sum of Rs 690000 in one case and Rs 80000 in the other for the loss of profits suffered by the manufacturing business of the management a pronouncement unusual even according to counsel for the appellant although sustainable in law according to him
For the workers this unique direction of industrial law is fraught with ominous consternation and dangerous detriment
The Mazdoor Sangh challenged the award as illegal and void by filing two writ petitions but the High Court quashed that part of the award which directed payment of compensation by the workers to the management and as earlier pointed out both sides have chosen to abide by the award in relation to the denial of wages during the strike period
The Main Points Urged The short but important issue which has projected some serious questions of law is as to whether the impugned part of the award has been rightly voided by the High Court
We may as well formulate 17 them but highlight the only major submission that merits close examination dealing with the rest with terse sufficiency
In logical order counsel for the appellant urged that 1 a an award under section 10A of the Act savours of a private arbitration and is not amenable to correction under article 226 of the Constitution
b Even if there be jurisdiction a discretionary desistance from its exercise is wise proper and in consonance with the canons of restraint this Court has set down
2 The award of compensation by the arbitrators suffers from no vice which can be regarded as a recognised ground for the High Court s interference
3 The view of law taken by the High Court on 1 the supposed flaw in the award based on mixed motives  for the offending strike ii the exclusion of remedies other than under section 26 of the Act and iii the implied immunity from all legal proceedings against strikers allegedly arising from section 18 of the is wrong
A few other incidental arguments have cropped up but the core contentions are what we have itemised above
1 a  b The expansive and extraordinary power of the High Courts under article 226 as wide as the amplitude of the language used indicates and so can affect any person even a private individual and be available for any other purpose even one for which another remedy may exist
f The amendment to article 226 in 1963 inserting article 2261A reiterates the targets of the writ power as inclusive of any person by the expressive reference to the residence of such person 
But it is one thing to affirm the jurisdiction another to authorise its free exercise like a bull in a China shop
This Court has spelt out wise and clear restraints on the use of this extra ordinary remedy and High Courts will not go beyond those wholesome inhibitions except where the monstrosity of the situation or other exceptional circumstances cry for timely judicial interdict or mandate
The mentor of law is justice and a potent drug should be judiciously administered
Speaking in critical retrospect and portentous prospect the writ power has by and large been the people s sentinel on the qui vive and to cut back on or liquidate that power may cast a peril to human rights
We hold that the award here is not beyond the legal reach of article 226 although this power must be kept in severely judicious leash
Many rulings of the High Courts pro and con were cited before us to show that an award under section 10A of the Act is insulated from interference under article 226 but we respectfully agree with the observations of Gajendragadkar J as he then was in Engineering Mazdoor Sabha vs Hind Cycles Ltd1 which nail the argument against the existence of jurisdiction
The learned Judge clarified at p 640 Article 226 under which a writ of certiorari can be issued in an appropriate case is in a sense wider than article 136 because the power conferred on the High Courts to issue certain writs is not conditioned or limited by the requirement that the said writs can be issued only against the orders of Courts or Tribunals
Under article 2261 an appropriate writ can 1 1963 Supp
I SCR 625
18 be issued to any person or authority including in appropriate cases any Government within the territories prescribed
Therefore even if the arbitrator appointed under section 10A is not a Tribunal under article 136 in a proper cases a writ may lie against his award under article 226
p 640 We agree that the position of an arbitrator under section 10A of the Act as it then stood vis a vis article 227 might have been different
Today however such an arbitrator has power to bind even those who are not parties to the reference or agreement and the whole exercise under section 10A as well as the source of the force of the award on publication derive from the statute
It is legitimate to regard such an arbitrator now as part of the methodology of the sovereign s dispensation of justice thus falling within the rainbow of statutory tribunals amenable to judicial review
i This observation made en passant by us is induced by the discussion at the bar and turns on the amendments to section 10A and cognate provisions like section 23 by Act XXXVI of 1964
Should the Court invoke this high prerogative under article 226 in the present case  That depends
We will examine the grounds on which the High Court has in the present case excised a portion of the award as illegal keeping in mind the settled rules governing judicial review of private arbitrator s awards
Suffice it to say an award under section 10A is not only not invulnerable but more sensitively susceptible to the writ lancet being a quasi statutory body s decision
Admittedly such an award can be upset if an apparent error of law stains its face
The distinction in this area between a private award and one under section 10A is fine but real
However it makes slight practical difference in the present case in other cases it may
The further grounds for invalidating an award need not be considered as enough unto the day is the evil thereof
2 Thus we arrive at a consideration of the appellants second submission perhaps the most significant in the case that the High Court had no legitimate justification to jettison the compensation portion of the award
Even here we may state that counsel for the appellants right at the outset mollified possible judicial apprehensions springing from striking workers being held liable for loss of management s profits during the strike period by the assurance that his clients were inclined to abandon realisation of the entire compensation even if this Court up held that part of the award in reversal of the judgment of the High Court a generous realism
He fought a battle for principle not pecunia
We record this welcome fact and proceed on that footing
The relevant law which is beyond controversy now has been clearly stated in Halsbury s Laws of England thus  Error of law on the face of award An arbitrator s award may be set aside for error of law appearing on the face of it though the jurisdiction is not lightly to be exercised
The jurisdiction is one that exists at common law independently of statute
In order to be a ground for setting aside the award an error in law on the face of the award must be such that there can be found in the award or in a document actually 19 incorporated with it some legal proposition which is the basis of the award and which is erroneous
 where the question referred for arbitration is a question of construction which is generally speaking a question of law the arbitrator s decision cannot be set aside only be cause the court would itself have come to a different conclusion but if it appears on the face of the award that the arbitrator has proceeded illegally as for instance by deciding on evidence which was not admissible or on principles of construction which the law do s not countenance there is error in law which may be ground for setting aside the award
para 623 p 334 Vol 2 Fourth Edn We adopt this as sound statement of the law
Not that English law binds us but that the jurisprudence of judicial review in this branch is substantially common for Indian and Anglo American systems and so Halsbury has considerable persuasive value
The wider emergence of common canons of judicial review is a welcome trend towards a one world public law
Indeed this Court has relied on the leading English decisions in several cases
We may content ourselves with adverting to Bungo Steel Furniture1 and to the unreported decision Babu Ram2
In simple terms the Court has to ask itself whether the arbitrator has not tied himself down to an obviously unsound legal proposition in reaching his verdict as appears from the face of the award
Bhargava J speaking for the majority in Bungo Steel1 stated the law It is now a well settled principle that if an arbitrator in deciding a dispute before him does not record his reasons and does not indicate the principles of law on which he has proceeded the award is not on that account vitiated
It is only when the arbitrator proceeds to give his reasons or to lay down principles on which he has arrived at his decisions that the Court is competent to examine whether he has proceeded contrary to law and is entitled to interfere if such error in law is apparent on the face of the award itself p 640 641 In Bharat Barrel  Drum Manufacturing Co 8 dealing with a private award and the conditions necessary for exercise of writ jurisdiction to correct an error of law apparent on the record did not lay down the law differently from what we have delineated
In one of the leading English cases Champsey Bhara  Co 4 followed in India Lord Dunedin defined error of law on the face of the award  as where the question of law necessarily arises on the face of the award or upon some paper accompanying and forming part of the award  and said that then only the error of law therein would warrant judicial correction
The Law Lord expressed himself lucently when he stated An error in law on the face of the award means in their Lordships  view that you can find in the award 
some legal 1 1967 1 SCR633
2 CA107 of 1966 decided on 5 12 68
3  4 50 IA 324
20 proposition which is the basis of the award and which you can then say is erroneous Williams J in the case of Hodkinson vs Verne1 hit the nail on the head by using the telling test as firmly established viz where the question of law necessarily arises on the face of the award 
In this view the enquiry by the Court before venturing to interfere is to ascertain whether an erroneous legal proposition is the basis of the award
Nay still less
Does a question of law not even a proposition of law necessarily arise on the award followed by a flawsome finding explicit or visibly implicit Then the Court can correct
Tucker J in James Clark 2 formulates the law to mean that if the award were founded on a finding which admits of only one proposition of law as its foundation and that law is erroneous on its face the Court has the power and therefore the duty to set right
While the Judge cannot explore by changing subterranean routes or ferret out by delving deep what lies buried in the unspoken cerebration of the arbitrator and  interfere with the award on the discovery of an error of law by such adventure it is within his purview to look closely at the face of the award to discern the law on which the arbitrator has acted if it is transparent even translucent but lingering between the lines or merely wearing a verbal veil
If by such an intelligent inspection of the mien of the award which is an index of the mind of the author an error of law forming the basis of the verdict is directly disclosed the decision is liable to judicial demolition
In James Clark 2 the issue was posed with considerable clarity and nicety
If at its face value the award appears to be based on an erroneous finding of law alone it must fail
The clincher is that the factual conclusion involving a legal question must necessarily be wrong in point of law
Even though the award contains no statement of the legal proposition if the facts found raise a clear point of law which is erroneous on the face of it  the Court may rightly hold that an error of law on the face of the award exists and invalidates
Let us put the proposition more expressively and explicitly
What is important is a question of law arising on the face of the facts found and F its resolution ex facie of sub silentio
The arbitrator may not state the law as such
Even then such cute silence confers no greater or subtler immunity on the award than plain speech
The need for a speaking order where considerable numbers are affected in their substantial r t rights may well be a facet of natural justice or fair procedure although in this case we do not have to go so far
If as here you find an erroneous law as the necessary buckle between the facts found and the conclusions recorded the award bears its condemnation on its bosom
Not a reference in a narrative but a clear legal nexus between the facts and the finding
The law sets no premium on juggling with drafting the award or hiding the legal error by blanking out
The inscrutable face of the sphinx has no better title to invulnerability than a speaking face which is a candid index of the mind
We may by way aside express hopefully the view that a minimal judicialisation by statement laconic or lengthy of the essential law that guides the decision is not only reasonable and desirable but has over the ages been observed by arbitrators and quasi judicial tribunals as a norm of processual justice
We 1   2 19441 KB 566
21 do not dilate on this part of the argument as we are satisfied that be the test the deeply embedded rules to issue certiorari or the traditional grounds to set aside an arbitration award thin partition do their bounds divide  on the facts and circumstances of the present case
The decisive question now comes to the fore
Did the arbitrators commit an error of law on the face of the award in the expanded sense we have explained  The basic facts found by the arbitrators are beyond dispute and admit of a brief statement
We summarise the fact situation succinctly and fairly when we state that according to the arbitrators the strike in question was in violation of section 24 of the Act and therefore illegal
This illegal strike animated by inter union power struggle inflicted losses on the management by forced closure
The loss flowing from the strike was liable to be recompensed by award of damages
In this 2chain of reasoning is necessarily involved the question of law as to whether an illegal strike causing loss of profit is a delict justifying award of damages
The arbitrators held yes
We hold this to be an unhappy error of law loudly obtrusive on the face of the award
We may as well set out for the sake of assurance the simple steps in the logic of the arbitrators best expressed in their own words which we excerpt a It is argued that strike is a legitimate weapon in the hands of workmen for redressal of their grievances and if they are made liable for loss on account of strike then the basic idea of strike as a means for having the grievances redressed will be taken away
The fallacy in this argument is that it presupposes the strike not to be illegal and unjustified
In the pre sent case we found the strike to be otherwise
The workmen have got no right of getting their grievances redressed by resorting to illegal means which is an offence
b It has been argued that the claim for compensation is not an industrial dispute as defined in the 
Considering the issue of compensation in a water tight compartment the argument might appear to be attractive
But in our opinion in this case the claim for compensation by the company is a consequence flowing from an admitted industrial J dispute which in this case is whether the strike was illegal andor unjustified and as against the condition of service as laid down in the certified standing order on which point our finding has been against the workmen
 The award of the Tribunal in its totality is quite prolix the reasons stated in arguing out its conclusions many and thus it is just to state that in the present case the arbitrators two retired Judges of the Calcutta High Court have made a sufficiently speaking award both t on facts and on law
They have referred to the strike being illegal with specific reference to the provisions of the Act but faulted them selves in law by upholding a case for compensation as axiomatic necessarily based on a rule of common law ie English common law
The rule of common law thus necessarily arising on the face of the award is a clear question of law
22 What is this rule of common law Counsel for the appellants inevitably relied on the tort of conspiracy  and referred us to Moghul Steamship Co1 Allen vs Floor2 Quinn vs Leathem3 and Sorrel vs Smith 4
These decisions of the English Courts are a response to the societal requirements of the industrial civilisation of the 19th Century England
Trade and Industry on the laissez faire doctrine flourished and the law of torts was shaped to sene the economic interests of the trading and industrial community
Political philosophy and economic necessity of the dominant class animate legal theory
Naturally the British law in this area protected business from the operations of a combination of men including workers in certain circumstances
Whatever the merits of the norms violation of which constituted conspiracy  in English law it is a problem for creative Indian jurisprudence to consider detached from anglo phonic inclination how far a mere combination of men working for furthering certain objectives can be prohibited as a tort according to the Indian value system
Our Constitution guarantees the right to form associations not for gregarious pleasure but to fight effectively for the redressal of grievances
Our Constitution is sensitive to workers  rights
Our story of freedom and social emancipation led by the Father of the Nation has employed from the highest of motives combined action to resist evil and to right wrong even if it meant loss of business profits for the Liquor vendor the brothel keeper and the foreign cloth dealer
Without expatiating on these seminal factors we may observe that English history political theory and life style being different from Indian conditions replete with organised boycotts and mass satyagrahas we cannot incorporate English torts without any adaptation into Indian law
A tort transplant into a social organism is as complex and careful an operation as a heart transplant into an individual organism law being life s instrumentality and rejection of exotics being a natural tendency
Here judges are sociological surgeons
Let us examine conspiracy  in the English Law of Torts to see if even there it is possible to hold that an illegal strike per se spells the wrong
We may state that till recently it could not be said with any certainty that there was any such tort as conspiracy 
Salmond thought that there was not See Salmond Law of Torts
505 15 s Ed
It is interesting that in Edition of Salmond Mogul is linked up by the learned author with a capitalist economy
Be that as it may the common law of England today is more or less clear some rumblings notwithstanding
A combination wilfully to do an act causing damage to a man in his trade or other interests is unlawful and if damage in fact is caused is actionable as a conspiracy
To this there is an exception where the defendants  real and predominant purpose is to advance their own lawful interests in a matter in which they honestly believe that those interests would directly suffer if the action against the plaintiff was not taken
In truth the Crofter case has made section 1 1 1 2 3  4 23 of the Trade Disputes Act 1906 largely unnecessary for there will now be few conspiracies arising out of trade disputes which are not protected at common law
 pp 508 509 15th Edn Sweet  Maxwell emphasis ours The essence of actionable conspiracy is best brought out by Salmond The tort is unusual because it emphasises the purpose of the defendants rather than the results of their conduct p513 15th Edn Sweet  Maxwell emphasis ours Even when there are mixed motives liability will depend on ascertaining which is the predominant object or the true motive or the real purpose of the defendant
Mere combination or action even if it be by illegal strike may be far away from a conspiracy  in the sense of the law because in all such cases except in conceivably exceptional instances the object or motive is to advance the workers  interests or to steal a march over a rival union but never or rarely to destroy or damage the industry
It is difficult to fancy workers who live by working in the industry combining to kill the goose that lays the golden eggs
The inevitable by product of combination for cessation of work may be loss to the management but the obvious intendment of such a collective bargaining strategy is to force the employer to accept the demand of the workers for betterment of their lot or redressal of injustice not to inflict damage on the boss
In short it is far too recondite for an employer to urge that a strike albeit illegal was motivated by destruction of the industry
A scorched earth policy may in critical times of a war be reluctantly adopted by a people but such an imputed motive is largely imaginary in strike situations
However we are clear in our minds that if some individuals destroy the plant or damage the machinery wilfully to cause loss to the employer such individuals will be liable for the injury so caused
Sabotage is no weapon in workers  legal armoury
The leading case of Sorrel vs Smith supra emphasizes that a combination of two or more persons for the purpose of injuring a man in his trade is unlawful and if it results in damage to him is actionable
The real purpose of the combination is the crucial test between innocence and injury
It may well be that even where there is an offending object it may be difficult for a court to hold that there is a tort if one may read into the facts an equal anxiety for the defendants to promote their success which produces the plaintiff s extinction
There is a penumbral region as Lord Sumner pointed out in Sorrel Supra  How any definite line is to be drawn between acts whose real purpose is to advance the defendant s interests and acts whose real purpose is to injure the plaintiff in his trade is a thing which I feel at present beyond my power
 It is absolutely plain that the tort of conspiracy necessarily involves advertence to and affirmation of the object of the combination being the infliction of damage or distraction on the plaintiff
The strike 3 L390SCI76 24 may be illegal but if the object is to bring the employer to terms with the employees or to bully the rival trade union into submission there cannot be an actionable combination in tort
In the present case it is unfortunate that the arbitrators simply did not investigate or pass upon the object of the strike
If the strike is illegal the tort of conspiracy is made out appears to be the proposition of law writ tersely into the award
On the other hand it is freely conceded by counsel for the appellant that the object was inter union rivalry
There is thus a clear lapse in the law on the part of the arbitrators manifest
 on the face of the award
We have earlier referred to the need for a fresh look at conspiracy F as a tort when we bodily borrow the elements of English law and apply them to Indian law
It is as well that we notice that even in England considerable criticism is mounting on the confused state of 1 the law of conspiracy
JT Cameron has argued in 1965 Vol
28 Modern Law Review p 448 that experience has already shown that conspiracy is a hydra perfectly capable of growing two heads to replace an amputated one and the authorities contain material which could be used to impose liability in very wide and varied circumstances
It is time therefore to consider what form legislation should take and to urge that the proper answer is to remove the tort of conspiracy from the law altogether and with it the Rookes vs Barnard version of intimidation and to put in its place a different basis of liability
CONSPIRACY AND INTIMIDATION An Anti Meta physical Approach The author complains that the fundamental basis is unsatisfactory and uncertain and demands that a complete re writing of the principles on which the tort of conspiracy and intimidation is necessary
We may as well suggest that to silence possible mischief flowing from the confused state of the law and remembering how dangerous J it would be if long protracted but technically illegal strikes were to be followed by claims by managements for compensation for loss of profits a legislative reform and re statement of the law were under taken at a time when the State is anxious for industrial harmony consistent with workers  welfare This rather longish discussion has become necessary because the problem is serious and sensitive and the law is somewhat slippery even in England
We are convinced that the award is bad because the error of law is patent
The High Court has touched upon another fatal frailty in the ten ability of the award of compensation for the loss of profits flowing from the illegal strike
We express our concurrence with the High Court that the sole and whole foundation of the award of compensation by the arbitrators ignoring the casual reference to an ulterior  motive of inter union rivalry is squarely the illegality of the strike The workers went on strike claiming payment of bonus as crystalized 25 by the earlier settlement d2 10 1957
There thus arose an industrial dispute within section 2k of the Act
Since conciliation proceedings were pending the strike was ipso jure illegal sections 23 and 24
The consequence near or remote of this combined cessation of work caused loss to the management
Therefore the strikers were liable in damage to make good the loss
Such is the logic of the award
It is common case that the demands covered by the strike and the wages during the period of the strike constitute an industrial dispute within the sense of section 2k of the Act
Section 23 read with section 24 it is agreed by both sides make the strike in question illegal
An illegal strike  is a creation of the Act
As we have pointed out earlier the compensation claimed and awarded is a direct reparation for the loss of profits of the employer caused by the illegal strike
If so it is contended by the respondents the remedy for the illegal strike and its fall out has to be sought within the statute and not de hors it
If this stand of the workers is right the remedy indicated in section 26 of the Act viz prosecution for starting and continuing an illegal strike is the designated statutory remedy
No other relief outside the Act can be claimed on general principles of jurisprudence
The result is that the relief of compensation by proceedings in arbitration is contrary to law and bad
The Premier Automobiles Case1 settles the legal issue involved in the above argument
The industrial Disputes Act is a comprehensive and self contained Code so far as it speaks and the enforcement of rights created thereby can only be through the procedure laid down therein
Neither the civil court nor any other Tribunal or body can award relief
Untwalia J speaking for an unanimous court has n Premier Automobiles Supra observed The object of the Act as its preamble indicates is to make provision for the investigation and settlement of industrial disputes which means adjudication of such disputes also
The Act envisages collective bargaining contracts between Union representing the workmen and the management a matter which is outside the realm of the common law or the Indian law of Contract After sketching the scheme of the Act the learned Judge stated the law thus 
the Civil Court will have no jurisdiction to try and adjudicate upon an industrial dispute if it concerned enforcement of certain right or liability created only under the Act      In Deo vs Bridges 1831 1B and Ad 847 2 1898 AC 387 at p 859 are the famous and of quoted words of Lord Tenterden CJ saying where an Act creates an obligation and enforces the performance in a specified manner we take it to be a general rule that performance cannot be enforced in any other 1  26 Barraclough vs Brown  Ors1 decided by the House of Lords is telling particularly Lord Watson s statement of the law at p 622 The right and the remedy are given uno flatu and one cannot be dissociated from the other
 In short the enforcement of a right or obligation under the Act must be by a remedy provided uno flatu in the statute
To sum up in the language of the Premier Automobiles Ltd Supra If the industrial dispute relates to the enforcement of a right or an obligation created under the Act then the only  remedy available to the suitor is to get an adjudication under the Act
 Since the Act which creates rights and remedies has to be considered as one homogeneous whole it has to be regarded uno flatu in one breath as it were
On this doctrinal basis the remedy for the illegal strike a concept which is the creature not of the common law but of section 24 of the Act has to be sought exclusively in section 26 of the Act
The claim for compensation and the award thereof in arbitral proceedings is invalid on its face on its face  we say because this jurisdictional point has been considered by the arbitrators and decided by committing an ex facie legal error
It was argued and with force in our view that the question of compensation by workers to the management was wholly extraneous to the Act and therefore outside the jurisdiction of a voluntary reference of industrial dispute under section 10 A While we are not called upon to pronounce conclusively on the contention since we have ex pressed our concurrence with the High Court on other grounds we rest content with briefly sketching the reasoning and its apparent tenability
The scheme of the Act if we may silhouette it is to codify the law bearing on industrial dispute
The jurisdictional essence of proceedings under the Act is the presence of an industrial dispute 
Strikes and lock outs stem from such disputes
l he machinery for settlement of such disputes at various stages is provided for by the act
The statutory imprimatur is given to settlement and awards and norms of discipline during the pendency of proceedings are set down in the Act
The proscriptions stipulated as for example the prohibition of a strike are followed by penalties if breached
Summary procedures for adjudication as to whether conditions of service etc
 of employees have been changed during the s pendency of proceedings special provision for recovery of money due to workers from employers and other related regulations are also written into the Act
Against this backdrop we have to see whether a claim by an employer from his workmen of compensation 
consequent on any conduct of theirs comes within the purview of the Act
Suffice it to say that a reference to arbitration under section 10 A is restricted to existing or apprehended industrial disputes
Be it noted that we are not concerned with a private arbitration but a statutory one governed by the  deriving its validity enforceability and protective mantle during the pendency of the proceedings from 10 A No industrial dispute no valid arbitral 1 27 reference
Once we grasp this truth the rest of the logic is simple
What is the industrial dispute in the present case Everything that overflows such disputes spills into areas where the arbitrator deriving authority under section 10 A has no jurisdiction
The consent of the parties cannot create arbitral jurisdiction under the Act
In this perspective the claim for compensation can be a lawful subject for arbitration only if it can be accommodated by the definition of industrial dispute  in s2 k 
Undoubtedly this expression must receive a wide coll notation calculated as it is to produce industrial peace
Indeed the legislation substitutes for free bargaining between the parties a binding award but what disputes or differences fall within the scope of the Act This matter fell for the consideration of the Federal Court in Western India Automobile Association1
Without launching on a long discussion we may state that compensation for loss of business is not a dispute or difference between employers and workmen which is connected with the employment or non employment or the terms of employment or with the conditions of labour of any person 
We are unable to imagine a tort liability or compensation claim based on loss of business being regarded as an industrial dispute as defined in the Act having regard to the language used the setting and purpose of the statute and the industrial flavour of the dispute as one between the management and workmen
In this context we are strengthened in our conclusion by the provisions of section 33C which provides for speedy recovery of money due to a workman from an employer under a settlement or an award but not for the converse case of money due to an employer from workmen
There is no provision in the Act which contemplates a claim for money by an employer from the workmen
And indeed it may be a little startling to find such a provision having regard to workmen being the weaker section and Part IV of the Constitution being loaded in their favour
The new light shed by the benign clauses of Part IV must illumine even pre Independence statutes in the interpretative process
As yet and hopefully claims by employers against workmen on ground of tortious liability have not found a place in the pharmacopoeia of Indian Industrial Law
However as earlier stated we do not pronounce finally as it is not necessary
There was argument at the bar that the High Court was in error in relying on section 18 of the to rebuff the claim for compensation
We have listened to the arguments of Shri BC Ghosh in support of the view of the High Court understood on a wider basis
Nevertheless we do not wish to rest our judgment on that ground
Counsel for the appellants cited some decisions to show that an award falling outside the orbit of the Indian Arbitration Act can be enforced by action in court
We do not think the problem so posed arises in the instant case
We dismiss the appeal but in the circumstances there will be no order as to costs
PHP Appeal dismissed
1 1949 I L L J 245


Summary:
During the year 1948 the respondent workmen working with both the appellants went on illegal strike on account of Trade Union rivalry
The workmen were not paid wages for the strike period and the appellants lost their profit during the period
The employers and the workmen entered into an agreement during the pendency of the conciliation proceedings and referred the claims of workmen for salaries during the strike period and the claims of the employers for compensation for loss due to the strike to the joint arbitration of two retired High Court Judges and one retired Member of a Labour Appellate Tribunal under section 10 A of the 
The arbitrator delivered their award and held that the workmen participating in the strike were not entitled to wages for the strike period
The arbitrators however awarded huge compensation to the employers against the workmen for the losses incurred by the employers during the strike period
The workmen challenged the award as illegal and void by filing two writ petitions in the High Court
The High Court upheld that part of the award which directed that the workmen participating in tho strike were not entitled to wages
The High Court however quashed the part of the award which directed payment of compensation by the workers to the management
In appeal by Special Leave under Article 136 the appellants contended 1
The award under section 10 A of the Act savours of a private arbitration and is not amenable to correction under Article 226 of the Constitution
The award of compensation by the arbitrators suffers from no vice which can be regarded as recognised grounds for the High Court interference
 HELD 1 The expansive and extraordinary powers of the High Court under Article 226 as wide as the amplitude of the language used indicates and so can affect any person even a private individual and be available for any other purpose even one for which another remedy may exist
The insertion of Article 2261A reiterates that writ power can be exercised against any person by reference to the residence of such person
It is one thing to affirm the jurisdiction and another to authorise free exercise
This Court has spelt out wise and clear restraints on the use of this extraordinary remedy and High Courts will not go beyond those wholesome inhibitions except where the monstrosity of the situation or other exceptional circumstances cry for timely judicial interdict or mandate
17C E 2
An arbitrator exercising powers under section 10A can bind even those who are not parties to the reference or agreement and the whole exercise under section 10A as well as the source of the force of the award on publication derive from the statute
It is legitimate to regard such an arbitrator now as part of the methodology of the sovereign s dispensation of justice thus falling within the rainbow of statutory tribunals amenable to judicial review
The award in the present case is not beyond the legal reach of Article 226
18B C 13 3
The answer to the question whether the High Court should have exercised its powers under Article 226 in the present case will depend upon whether the arbitrator has tied himself down to obviously unsound legal proposition in reaching his verdict appearing from the face of the award
The arbitrator may not state the law such even then such cute silence confers no greater or subtler immunity on the award than plain speech
The need for speaking order where considerable numbers are affected in their substantial rights may well be a facet of natural justice or fair procedure although in this case we do not have to go so far
The law sets no premium on juggling with drafting the award or hiding the legal error by balancing out
The inscrutable face of the sphinx has no better title to invulnerability than a speaking face which is a candid index of the mind
19D 20F H 4
According to the arbitrators the strike was illegal being in violation of section 24 of the Act
the illegal strike was animated by inter union power struggle and that it inflicted loss on the management by forced closure and that the loss flowing from the strike was liable to be recompensed by award of damages
In this chain of reasoning the question of law whether an illegal strike causing loss of profit justifies award of damages is necessarily involved
The arbitrator held in the affirmative and according to us it is an unhappy error of law
In the present case the arbitrators have made a sufficiently speaking award both on facts and on law
After coming to the conclusion that the strike was illegal they held that compensation necessarily follows based on the rule of English common law
The English cases laying down the rule of common law were a response to the requirement of Industrial civilization of the 19th Century England
Trade and industry on the laissez faire doctrine flourished and the law of torts was shaped to serve the economic interests of the trading and industrial community
Whatever the merits of the norms violation of which constituted conspiracy  in English Law it is a problem for creative Indian Jurisprudence to consider how far a mere combination of men working for furthering certain objective can be prohibited as a tort according to the Indian value system
Our constitution guarantees the right to form associations not for gregarious pleasure but to fight effectively for the redressal of grievances
Our constitution is sensitive to workers rights
English history political theory and life style being different from Indian conditions where the Father of the Nation organised boycotts and mass satyagrahas we cannot incorporate English conditions without any adaptation into Indian Law
21B C 22A B C D 5
Even in England till recently it could not be said with any certainty that there was any such tort as conspiracy
The tort is unusual because it emphasizes the purpose of the defendants rather than the result of their conduct
Even when there are mixed motives liability will depend on ascertaining which is the predominant object of the true motive or the real purpose of the defendant
The motive of an illegal strike may be to advance the workers  interest or steal a march over a rival union but never or rarely to destroy or damage the industry
However if some individuals destroy the plant and machinery willfully to cause loss to the employer such individuals will be liable for the injury so caused
Sabotage is no weapon in workers  legal armoury
It is absolutely plain that the tort of conspiracy necessarily involves advertence to the object of the combination being the infliction of damage on The plaintiff
The strike may be illegal but if the object is to bring the employer to terms with the employees or to bully the rival trade union into submission there cannot be an actionable combination in tort
In the present case the arbitrators did not investigate the object of the strike
The arbitrators assumed that if the strike is illegal the tort of conspiracy is made out
The counsel for the appellants fairly conceded that the object of the strike was inter union rivalry
There is thus a clear lapse in the law on the part of the arbitrators manifest on the face of the award
22F 231B C E H  24A B 6
It is common case that the demand for the wages during the strike period constitutes an industrial Dispute within section 2k of the Act
It is agreed by both the sides that section 23 read with section 24 makes the strike in question illegal
An illegal strike is the creation of the statute and the remedy for the illegal strike and its fall out has to be sought within the statute and not de hors 14 it
No other relief outside the Act can be claimed on general principles of jurisprudence
The case of Premier Automobiles followed
25 B C 7
The enforcement of a right or obligation under the Act must be by a remedy provided in the Statute
The right of the management to claim compensation is not provided by the Act and therefore the arbitrators Committed an ex facie legal error
The consent of the parties cannot create arbitral jurisdiction under the 
The claim for compensation cannot be a lawful subject for arbitration because it is not covered within the definition of Industrial Disputes in section 2k
We are unable to imagine a tort of liability or compensation based on loss of business being regarded as an industrial dispute as defined in the Act
Section 33 provides for speedy recovery of money due to a workman from an employer under a settlement or award
It does not provide for recovery of money by the employer from the workman
Obviously because the workman belongs to the weaker section
Claims by employers against the workmen on grounds of tortious liability have not found a place in the pharmacopeia of Indian Industrial Law
26 D 27A C D E