WP/4501/2010 : 1 : IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION WRIT PETITION NO.4501 OF 2010 ALONG WITH CIVIL APPLICATION NO.1573 OF 2010 The Cosmos Co-op. Bank Ltd. .. Petitioner V/s. Bank Karmachari Sangh .. Respondent Mr. Shekhar Naphade i/b. Mrs. Meena H. Doshi for the Petitioners. Mr. Nitin Kulkarni for the Respondents. CORAM :SMT. NISHITA MHATRE, J. RESERVED ON :29 TH JUNE, 2010. PRONOUNCED ON:26 TH JULY, 2010. P.C. : 1. Rule. Rule made returnable forthwith, by consent. 2. The Writ Petition challenges the Order below Exh. U-2 and U-8 dated 31st May, 2010, passed by the Industrial Court, Pune, in Complaint (ULP) No.140 of 2010. 3. The issue which arises in this Writ Petition is whether the Bombay Industrial Relations Act, 1946, (for short “the BIR Act”), and consequently the Maharashtra Recognition of Trade Unions and WP/4501/2010 : 2 : Prevention of Unfair Labour Practices Act, 1971, (for short “the MRTU & PULP Act”), govern the petitioner-Bank. In short, the petitioner-Bank contends that since it is now a Multi State Co- operative Bank, the provisions of the BIR Act no longer apply to it; as a corollary, the provisions of the MRTU & PULP Act would also not apply. Therefore, according to the petitioner-Bank the Industrial Court acting under the MRTU & PULP Act could not have passed the impugned order directing it to implement the Settlement, which was executed by it with the Cosmos Co-operative Bank Sevak Sangh. The issue as to whether the appropriate Government is the Central Government or the State Government in respect of Multi State Co-operative Banks has been decided by the Apex Court in the case of Bharat Co-operative Bank (Mumbai) Ltd. v. Co-operative Bank Employees Union, reported in (2007) 4 SCC 685. The Apex Court has held, by considering the provisions of the Industrial Disputes Act and the MRTU & PULP Act, that the appropriate Government would be the State Government insofar as Multi State Co-operative WP/4501/2010 : 3 : Banks are concerned. The learned Counsel for the petitioner-Bank in the present case submits that this judgement does not consider the provisions of the BIR Act and, therefore, it is necessary for this Court to decide the issue as to whether the provisions of the BIR Act and consequently the MRTU & PULP Act are applicable to the Multi State Co- operative Banks. 4. The Bombay Industrial Disputes Act, 1938, (for short “the BID Act”), was enacted by the Government of the erstwhile State of Bombay. Under Section 2(3), the provisions of the BID Act were made applicable to Banking Companies registered under any of the enactments relating to companies. At that point of time the Indian Companies Act, 1913, was the enactment in existence relating to companies. The definition of “company” in the Indian Companies Act included “Banking Companies”. The BID Act was replaced by the BIR Act. Section 2(3) of this Act provided that the Act would apply to the industries which were governed by the BID Act. An amendment was introduced to Section 2(3) of WP/4501/2010 : 4 : the BIR Act by the Amendment Act 55 of 1949. This proviso which was inserted stipulated that the provisions of the BIR Act would cease to apply to the Imperial Bank of India and any Banking Company as defined in Section 5 of the Banking Companies Act, 1949 having branches or other establishments in more than one State. The Indian Companies Act of 1913 was repealed and the Companies Act, 1956 was enacted. Similarly the Co-operative Societies Act of 1925 was replaced by the Maharashtra Co- operative Societies Act, 1960. 5. The Division Bench of this Court in the case of The Majoor Sahkari Bank Ltd. v. N.M. Majmudar, reported in (1955) 57 BLR 1097, examined whether a Co-operative Society doing banking business and registered under the enactments relating to companies was a Banking Company registered as contemplated by the notification issued by the Government of Mumbai under Section 2(3) of the BID Act. The Division Bench drew a distinction between incorporation of a company “under” an Indian Law and “by” an Indian Law. The Court held that there WP/4501/2010 : 5 : was no reason or principle why a Co-operative Society doing banking business should be treated on a different footing with regard to industrial law from other companies doing identical business. Thus the Division Bench, in no uncertain terms, held that a Co-operative Society doing banking business must be considered as a Banking Company and would be considered as such for the purposes of industrial law. 6. The Banking Regulation Act, 1949,Act was amended by the Amendment Act 23 of 1965. Part V was introduced into the Banking Regulation Act, 1949. By virtue of Section 56 which is contained in this Part, the provisions of the Banking Regulation Act, 1949, were made applicable to the Co-operative Societies as they apply to Banking Companies, with certain modifications. The references to “the Banking Companies” or “the Company” in the Act were to be construed as references to a Co-operative Bank. The definitions of “Co-operative Bank” and “Multi State Co-operative Bank” were inserted into the Act by this amendment. WP/4501/2010 : 6 : 7. In the case of Co-operative Bank Employees Union v. Saraswat Co-operative Bank Ltd., reported in 1983 (47) FLR 348, the issue arose as to whether Co-operative Banks having branches in more than one State were covered by the provisions of the BIR Act. A learned Single Judge of this Court (Pendse, J.) held that they were not. It has been held that cooperative banks being banking companies are excluded from the applicability of the Act because of the proviso to sub section 3 of section 2 of the B.I.R. Act. In this case Pendse, J. considered the submission of the Union that the proviso to sub- section 3 of Section 2 should be strictly construed. After analysing the legislative history of the BIR Act and referring to the judgement of the Division Bench in the case of The Majoor Sahkari Bank Ltd. v. N.M. Majmudar (supra), the learned judge held that the effect of the amendment of the Banking Regulation Act, 1949, was to include the Co-operative Banks within the scope of the definition of “Banking Company” under Section 5 of that Act. The expression “Banking Company” used in WP/4501/2010 : 7 : the proviso would cover Co-operative Banks having branches in more than one State and, therefore, it was concluded that the provisions of the BIR Act are not applicable to Co-operative Banks having branches in more than one State. As noted by Pendse, J., the disputes between the Multi State Co-operative Banks and their employees would be regulated by the provisions of the Industrial Disputes Act. 8. As mentioned earlier in the case of Bharat Co- operative Bank (Mumbai) Ltd. v. Co-operative Bank Employees Union (supra), the Supreme Court has laid down the ratio that the appropriate Government for Multi State Co-operative Banks would be the State Government in which the Bank is located. Thus, reading the judgements in the case Bharat Co- operative Bank (Mumbai) Ltd. v. Co-operative Bank Employees Union (supra) and in the case of Co- operative Bank Employees Union v. Saraswat Co- operative Bank Ltd.(supra), harmoniously, the inescapable conclusion is that although the appropriate Government is the State Government, the WP/4501/2010 : 8 : provisions of the BIR Act would no longer apply to the Multi State Co-operative Banks in view of the proviso to Section 2(3) of the BIR Act. 9. The issue as to whether the appropriate Government is the State Government or the Central Government in relation to the petitioner-Bank has already been decided by a learned Single Judge of this Court (Khanwilkar, J.) in the case of Cosmos Co-operative Bank Ltd. v. General Federation Maharashtra State Bank Employees Federation, reported in 2008 (6) Bom.C.R. 877.It has been held that the State Government is the appropriate Government. 10. However the complaint in the present case has been filed under the provisions of the MRTU & PULP Act. The respondent-Union is an approved and representative union under the BIR Act for the Pune District. It has filed the complaint alleging that the petitioner-Bank has committed unfair labour practices under Item 5 of Schedule II read with Items 9 and 10 of the M.R.T.U. and P.U.L.P. Act. WP/4501/2010 : 9 : According to the respondent-Union the petitioner- Bank was negotiating with and attempting to arrive at a settlement with another Union, namely, the Cosmos Co-operative Bank Sevak Sangh. It was pleaded, inter alia, that it had refused to hold negotiations with the respondent-Union in respect of the charter of demands submitted by it. Interim relief was also sought by the respondent-Union, restraining the petitioner-Bank from signing any settlement with the other Union. By the impugned order the Industrial Court has directed the petitioner-Bank not to implement the settlement signed by it with the Cosmos Co-operative Bank Sevak Sangh pending the Complaint. 11. There can be no doubt that the Industrial Court acting under the MRTU & PULP Act is empowered to decide the complaint. Although the BIR Act is not applicable to the petitioner-Bank, the provisions of the Industrial Disputes Act are applicable. The appropriate Government being the State Government the provisions of the MRTU & PULP Act would also be applicable. Once I have held that the BIR Act is WP/4501/2010 : 10 : not applicable, then the interim order passed by the Industrial Court in the present case cannot be upheld. This is more so since the respondent-Union is a representative union for a particular local area. There is nothing on record to suggest that it is a recognized Union under the MRTU & PULP Act. A Union which is a representative Union under the BIR Act does not ipso facto acquire the status of a recognised Union under the MRTU & PULP Act. In these circumstances, the order of the Industrial Court cannot be sustained. 12. The Order below Exh. U-2 and U-8 dated 31st May, 2010, passed by the Industrial Court, Pune, in Complaint (ULP) No.140 of 2010 is, therefore, quashed and set aside. 13. An affidavit has been filed by Shri Machindranath Ganesh Ursekar, the Managing Director of the petitioner-Bank, in which he has undertaken that the petitioner-Bank will pay the benefits under the Settlement dated 16th May, 2010 to all workmen without insisting on an undertaking being WP/4501/2010 : 11 : given by them in the proforma annexed to the Settlement, without prejudice to the rights and contentions of the petitioner-Bank, the provisions of the BIR Act did not apply. This undertaking is accepted. 14. The Writ Petition is allowed accordingly. 15. In view of the above, the Civil Application No.1573 of 2010 pending in the Writ Petition is disposed of.