1 IN THE HIGH COURT OF BOMBAY AT GOA WRIT PETITION NO.143 OF 2010 Goa Shipyard Workers' Union, A Trade Union registered under the Trade Unions Act, 1926 having its Office at Velhos Building, Second Floor, Opp. Municipal Garden, Panaji, Goa represented through its General Secretary Shri John Paul Noronha. ........ Petitioner. V/s. 1. Union of India, represented through its Secretary for Labour, Ministry of Labour, Central Secretariat, New Delhi. 2. The Assistant Labour Commissioner (Central), Government of India, having his office at Dr. Mukund Building, Third Floor, Vasco-da-Gama, Goa. 3.M/s. Goa Shipyard Limited, a Company incorporated under the Companies Act, 1956 and a Government of India undertaking having its registered Office at Vadem, Vasco-da-Gama, Goa represented through its Chairman and Managing Director. ........ Respondents. Mr. A. V. Nigalye, Advocate for the petitioners. Mr. C. A. Ferreira, Asst. Solicitor General for respondents No.1 and 2. Mr. M. S. Bandodkar, Advocate for respondent No.3. 2 CORAM : A.S.OKA & F.M.REIS, JJ. Date of reserving the Judgment : 20th July, 2010 Date of pronouncing the Judgment : 5th August, 2010 J U D G M E N T :- (Per A.S. OKA, J.) 1. On 3rd May, 2010 notice for final disposal at the admission stage was issued. Rule. Respondents waive service. Taken up for hearing. 2. The challenge in this petition under Article 226 of the Constitution of India is to the communication dated 17th November, 2009 issued by the Desk Officer, Ministry of Labour, Government of India. By the said communication, the prayer made by the petitioner for referring industrial dispute for adjudication of the Industrial Tribunal in accordance with Section 12(5) of the Industrial Disputes Act, 1942 (hereinafter, referred to as “the said Act”) has been rejected. 3 The petitioner is a trade union of the workmen of the third respondent Goa Shipyard Limited. The petitioner claims that it represents a substantial number of workmen of the third respondent. 3 The third respondent is an undertaking of Government of India. It is stated that about 1000 workmen are employed by the third respondent. 4. According to the petitioner, the third respondent had signed wage settlements with its workmen from time to time. According to the petitioner, the last settlements expired on 31st December, 2006. On 29th January, 2007, the petitioner served a charter of demands to the third respondent, seeking revision of wages and other conditions of service. According to the petitioner, the third respondent represented that as per the guidelines of Government of India, the new settlements should be for a period of 10 years. On 14th August, 2008, the third respondent addressed a letter to the petitioner stating that periodicity would not be a roadblock. The third respondent informed that it has decided to delink five chapters of the charter of demands which did not deal with periodicity. According to the case of the petitioner, negotiations were held on delinking of charter of demands. According to the petitioner, a settlement under Section 12(3) of the said Act was signed between the petitioner and the third respondent on recruitment and promotion of the employees. The case of the petitioner is that the Central Government issued fresh 4 guidelines providing that the period of settlement in Public Sector Enterprises can be of less than 10 years, but not less than five years. According to the petitioner, the officers of the third respondent started unfair labour practice of pressurising the workers to resign from the petitioner union. They represented that if the workmen sign settlement for ten years with parallel union it will give them substantial benefits, which will be denied to the workmen who do not accept the settlement for 10 years. The petitioner sought intervention of the Assistant Labour Commissioner to resolve the dispute. On 11th September, 2009, the Assistant Labour Commissioner submitted a failure report to the Central Government. Thereafter, a settlement under Section 18(3) of the said Act was signed by the third respondent with the parallel union, namely Goa Shipyard Kamgar Sangh and the group which was separated from the petitioner. It is contended that the settlement which is to remain in force for 10 years is not binding on the petitioner as the same has been signed under Section 18(1) of the said Act. By the impugned communication dated 17th November, 2008, the first respondent rejected the prayer for reference. 5. Learned Counsel appearing for the petitioner submitted 5 that during the course of conciliation proceedings the third respondent stated that out of 980 workmen, the petitioner by submitting a list had claimed that it had membership of 692 members. The third respondent stated that out of 692 members, 41 members are no longer in service and 422 have been separated from the Petitioner union. He pointed out that even taking the case of the third respondent as correct, there were still 230 workmen with the petitioner. He pointed out that the request for reference has been rejected only on the ground that the Memorandum of Settlement dated 28th August, 2009 has been signed by majority of the workmen. The learned Counsel appearing for the petitioner relied upon a decision of the Apex Court in the case of Indian Oxygen Ltd., vs. The Workmen employed by M/s. Indian Oxygen Ltd., (1979 LAB. I.C. 585). He submitted that even if a dispute is raised by the workmen who are in minority, that is no ground to hold that the dispute raised is not an industrial dispute. He submitted that the ground given in the impugned communication was wholly irrelevant and, therefore, a reference ought to have been made. 6. The learned Counsel appearing for the third respondent invited attention of the Court to the communication dated 26th May, 6 2010 issued by the Desk Officer of the Government of India, Ministry of Labour in which it is stated that out of 980 workmen, 964 have accepted the settlement dated 28th August, 2009. He submitted that virtually 99 % of the workmen have signed the said settlement. He invited attention of the Court to some of the documents annexed to the affidavit-in-reply to show that majority of workmen have signed the settlement. He relied upon a decision of the Apex Court in the case of The Nedungadi Bank Ltd. vs. K.P. Madhavankutty and ors., [2000(84) FLR 673]. He submitted that the object of reference sought only at the instance of only 12 workmen will be destructive to the industrial peace, as 99 % of the workmen have accepted the settlement and the reference at the instance of the petitioner will defeat the very object and purpose of the Act. He placed reliance on a decision of the Division Bench of this Court in the case of Pune Labour Union vs. State of Maharashtra and ors., (2010 (2) L.L.N. 503). He submitted that the reason that practically 99 % of the workmen have accepted the settlement is a good ground to decline the prayer for making a reference. He submitted that as the reason given for refusal of the reference is sufficient, no interference is called for. 7 7. We have carefully considered the submissions. In the impugned communication dated 17th November, 2009, the first respondent has observed thus : “ The management has signed a memorandum of settlement on 28/08/2009, with Goa Shipyard Kamgar Sangh, for revision of wages with effect from 01/01/2007 to 31/12/2016 and the terms of this settlement are reported to have been accepted by the majority of the workmen. As the management has entered into a settlement with a majority union on the same subject, and as it has been accepted by a majority of the workmen, the demand raised by the claimant union, in such circumstances, cannot be construed as an industrial dispute.” (emphasis added) It is pertinent to note that only reason given in the communication is that the management has entered into a settlement with a majority union and the settlement has been accepted by a majority of workmen. Only on this ground it is stated that the demand raised by the petitioner cannot be construed as an industrial dispute. 8. It will be necessary to note the stand taken by the third respondent during the conciliation proceedings on 8th July, 2009. In 8 the minutes of conciliation proceedings, it is recorded thus : “ During the conciliation proceedings today management agreed to give proposal for 10 years, provided GSWU give revised charter for 10 years. Management also explained that GSL has 980 workmen and GSWU had submitted list of 692 members out of 41 have retired/left GSL and 424 have separated from the Union. Thus in the Yard there are around 750 workers who are appearingly not members of GSWU. Other Unions and separated workers want 10 years settlement for which they have submitted revised charter to the management. ALC was requested to advise GSWU to submit their charter of demand for 10 years but ALC did not prefer to advise GSWU to revise their charter. The point of view which management is having in mind is that based on the charter of 5 years, 10 years proposal cannot be given.” Taking the stand as correct, out of 692 members, 465 members were not with the petitioner. Thus, 227 workmen continued with the petitioner. It is pertinent to note that the impugned communication does not record that 98% or 99 % of the workmen have signed the settlement. The present petition was filed on 18th February, 2010. The stand that 98 % of the workmen have signed the settlement is taken by the first 9 respondent for the first time in its communication dated 26th May, 2010. The said communication is issued on the basis of a letter written by a Member of Parliament. The said communication reads thus : “ I am directed to refer to the Failure of Conciliation Report No.VA-8(3)/09-10 dated 29/03/2010 from the ALC (Goa) received in this Ministry on 09/04/2010 on the above mentioned subject and to say that prima facie, this Ministry does not consider this dispute fit for adjudication for the following reasons : “Management of Goa Shipyard Ltd. has already Signed a memorandum of settlement under Sec-2(P) of the I.D. Act-1947 on 28/08/2009 with Goa Shipyard Kamgar Sangh/Wage Negotiation Committee and the term and condition of the said settlement has been accepted by 964 employees out of 980, which is 98.36 % of the employees constituting majority workers.” 9. The communication which is impugned in this writ petition makes a reference to settlement dated 28th August, 2009, but it does not record that 98.36 % of the employees have accepted the settlement. It merely states that the settlement has been accepted by a majority of workmen. It is not clear as to on what basis 10 communication dated 26th May, 2010 has been issued. Going by record of the conciliation proceedings and what is stated in the impugned communication, at the highest what can be said is that majority of workmen are no longer supporting the petitioner. The Union of India has not placed any material on record of this petition to show that there was material as of 17th November, 2009 to come to the conclusion that 98.36 % of the employees have accepted the settlement. Merely because the petitioner has no support of majority, it is no ground to deny a prayer for making reference. In the case of Indian Oxygen Ltd. (supra), in paragraph 10, the Apex Court stated thus : “.10. Section 4-K of the U.P. Act provides that where the State Government is of opinion that any industrial dispute exists or is apprehended, it may refer the dispute or any matter appearing to be connected with, or relevant to, the dispute to a Tribunal. Clause (1) of Section 2 of that Act defines an industrial dispute to mean, inter alia, any dispute or difference between employers and workmen which is connected with the terms of their employment. The expression “workmen” has been defined in clause (z) of Section 2 to mean, speaking generally, “any person” employed in any industry in the capacity mentioned therein. There is nothing in the Act to require that the dispute or 11 difference should be raised by all the workmen of the industry, or by everyone of them, or even by a majority of them. It is enough if the controversy is between the employer on the one side and workmen on the other. So also, there is nothing in the Act to require that the workmen raising the controversy should form a majority of the employees. The reason appears to be that where it is found that the controversy affects, or will affect, the interest of workmen as a class, the law envisages that, in the interest of industrial peace, it should be examined and decided in one of the modes provided by it. An individual dispute cannot however be said to be an industrial dispute unless of course the other workmen associate themselves with it. No hard and fast rule can possibly be laid down in such circumstances to decide when and by how many workmen an industrial dispute can be raised within the meaning of the Act, or whether a minority union, or even an unrecognised union, can raise an industrial dispute. It is enough if there is a potential cause of disharmony which is likely to endanger industrial peace and a substantial number of workmen raise a dispute about it, for then it is permissible to take the view that it is an industrial dispute within the meaning of clause (1) of Section 2 of the U.P. Act, and to refer it for adjudication to a Tribunal. Reference in this connection may be made 12 to the Tribunal’s finding of fact that although the Karamchari Union was not a recognised union and it was not a member of the Federal Union, it had a “substantial number of workmen of the concern as its members”. We have no doubt therefore that the State Government rightly took the view that the controversy raised by the Karamchari Union was an industrial dispute.” (emphasis added) 10. In absence of any material placed on record by the Union Of India, it is not possible to accept the contention of the third respondent that as on 17th November, 2009, 98.36 % of the employees had accepted the settlement. The impugned communication does not refer to 98.36% support to the settlement. The proceedings of conciliation show that more than 200 workmen continued to be with the petitioner. Thus, the very basis adopted for rejecting the reference as stated in the letter dated 17th November, 2009 is completely erroneous and irrelevant. The fact that a demand is made by workmen in minority is no ground by itself to reject prayer for reference. The decisions relied upon by the learned Counsel appearing for the third respondent will not help the third respondent, as the only ground on which the reference is declined is that the 13 settlement has been accepted by a majority of the workmen. 11. Hence, the petition must succeed and we pass the following order : The petition is allowed. Rule is made absolute in terms of prayer clauses (a) and (b). There shall be no order as to costs. A.S. OKA, J. F.M. REIS, J. ssm.