1 24 wp 3160.11.doc IN THE HIGH COURT OF JUDICATURE AT BOMBAY CIVIL APPELLATE JURISDICTION K WRIT PETITION NO. 3160 OF 2011 Mr. Dilip Vishnu Kadam & Ors. .. Petitioners Vs. The Chairman & Anr. .. Respondents Mr. Nitin A Kulkarni for the Petitioners. Mr. Avinash Ram Belge for Respondents. CORAM: K.K. TATED, J. DATE : 2ND AUGUST, 2011 P.C. 1. Heard the learned counsel for the parties. 2. Rule. 3. By consent, rule made returnable forthwith. 4. By this Petition under Articles 226 and 227 of the Constitution of India, the Petitioners – employees challenge the order dated 26th August, 2010 passed by the learned Member, Industrial Court, Satara, allowing the Respondents – employer’s Revision Application (ULP) Nos. 43, 44 and 45 of 2009 setting aside the common order dated 2 24 wp 3160.11.doc 23rd November, 2009 passed by the Labour Court below Exhibit 39, 41 and 42 in Complaints (ULP) Nos. 41 of 2007, 42 of 2007 and 48 of 2007 and thereby the Industrial Court rejected the suspension allowance granted by the learned Labour Court, Satara to the Petitioners. 5. It is the case of the Petitioners that on 7th October, 2001 the Respondent – employer issued show cause notice and thereafter, suspended the Petitioners, after following due process of law i.e. holding enquiry. The Respondent – employer terminated the Petitioners’ services by order dated 7th June, 2007. Being aggrieved by the said termination order dated 7th June, 2007, the Petitioners approached the Labour Court and filed Complaints under Maharashtra Recognition of Trade Union & Unfair Labour Practices Act, 1971. In those Complaints, Petitioners preferred Interim Application Exhibit 2. Said Application was allowed by the Labour Court on 9th October, 2007. Being aggrieved by the interim order dated 9th October, 2007, the Respondents - employers preferred Revision Applications before the Industrial Court. The said Revision was dismissed by the Appellate Court by order dated 29th September, 2008. Being aggrieved by the said order the Respondents – employers 3 24 wp 3160.11.doc preferred three Writ Petitions being Nos. 7425 of 2008, 7426 of 2008 and 7427 of 2008 in this court. Those Writ Petitions were disposed of by consent order which reads as under: “(i) The impugned order of the Labour Court dated 9.10.2007 and the order of the Industrial Court dated 29.09.2008 are hereby set aside. The matters are remanded back to the Labour Court for trial of Complaint (ULP) Nos.43 of 2007, 41 of 2007 and 42 of 2007, respectively, afresh from the stage of deposition of the Karkhana for proving the alleged misconduct of the respondents. All points are left open. The Labour Court shall decide the matters as expeditiously as possible and, in any case, not later than one year from the next date. (ii) Rule made absolute in the aforesaid terms.” 6. During the pendency of the Complaint, Petitioners filed Application dated 8th September, 2009 for suspension allowance. The said Application was allowed by the Labour Court by the order dated 23rd November, 2009 directing the Respondents – employer to pay suspension allowances to the Petitioners from the date of Application i.e. 8th September, 2009. Being aggrieved by the said order of the Labour Court, the Respondents – employers preferred three Revision Applications before the Industrial Court. Those Revision Applications were allowed by the Industrial Court on 26th August, 2010 setting 4 24 wp 3160.11.doc aside the order passed by the Labour Court. The Industrial Court held that Petitioners – original employees were not entitled to suspension allowance during the pendency of the Complaint as the same was not granted by this Hon’ble Court at the time of disposing the Writ Petition Nos. 7425 of 2008 and connected matters. The learned counsel appearing on behalf of the Petitioners submits that the Industrial Court erred in coming to the conclusion that the Petitioners were not entitled to suspension allowance during the pendency of the Complaint because at the time of disposing of three Writ Petitions, the High Court did not grant any liberty to the Petitioners to make such Application. He further submits that the Industrial Court erred in coming to the conclusion that the enquiry was not pending and therefore, the Petitioners were not entitled to any subsistence allowance as per law. The learned counsel appearing on behalf of the Petitioners submits that the Industrial Court erred in coming to the conclusion that the subsistence allowance can be granted only when the suspension is illegal. He submits that in the present case, the Labour Court as well as the High Court in the above mentioned three Writ Petitions directed the Respondents – employer to lead evidence in respect of fairness of enquiry and therefore, the Petitioners are entitled to suspension allowance. In support of these contentions, he 5 24 wp 3160.11.doc relies on the judgment in the matter of Tata Consulting Engineers, Mumbai vs. Dilip P. Pandit & Anr. reported in 2004 I CLR 44. In that case, the High Court held that even if the enquiry is over and the same is challenged before the Labour Court then also the employees are entitled to subsistence allowance. He relies on para 5 of the said judgment which reads thus: “5. The Division Bench, in the unreported decision relied upon by the Petitioners, while dealing with the issue relating to claim of subsistence allowance during the pendency of the proceedings for approval under Section 33 (2) (b) of the said Act, has clearly held thus:- “Broadly the cases in the Tribunal could be categorised in three categories. As far as the first category of cases is concerned, they are cases in which a workman is dismissed for misconduct after due inquiry and on scrutiny by the Labour Court or the Tribunal, as the case may be, also the inquiry is found to be valid. In such cases, there would be no justification for providing payment of subsistence allowance to the workman concerned. The mandate of the statute is to complete the proceedings within a period of three months. If in every case application for interim order is filed and on that application considerable amount of time is spent both the High Court, the legislative mandate or early hearing of the application would be 6 24 wp 3160.11.doc completely defeated. In such cases, the Tribunal would be justified in taking up the main application for approval for hearing. But there are cases in which either the domestic inquiry held by the management is set aside on the ground that it was defective or there was only a facade of an inquiry or there was no inquiry at all. But for the procedure evolved by the decisions of the Court in the interest of speedy finalisation of the cases in which the workmen were dismissed from service, by requiring the Labour Court or the Tribunal itself to hold a de novo inquiry, the position would have been, the moment it is established that the domestic inquiry is invalid or there was no domestic inquiry at all, the penalty imposed would have had to be set aside, but without prejudice to the right of the management to hold a de novo inquiry. In that situation, during the period of de novo inquiry, the management may be asked to give subsistence allowance to the workmen concerned in accordance with the Standing Orders or the rules regulating the condition of service. It is because of the procedure, namely, the holding of domestic inquiry by the Labour Court/Tribunal itself, evolved by the decision of the Court, it has resulted in this situation viz., even as the order of dismissal remains undisturbed, a de novo inquiry is held to find out as to whether dismissal was justified or not. We are of the opinion that if de novo inquiry is ordered to justify the order of dismissal and the matter has been unduly protracted for no fault of the workmen, the Tribunal would be justified in awarding subsistence allowance to the workman in appropriate cases. We, however, 7 24 wp 3160.11.doc hasten to add that the grant of interim relief is not a matter of course and the exercise of such power should be used sparingly and only in deserving cases.” 7. He also relied on the judgment in the matter of Mysore Cements Limited vs. B.R. Siddaramaiah and another, reported in 1985 Vol. 67 FJR 136. In that case, the Karnataka High Court held that whether the workman is guilty or not has to be inquired into de novo by the Tribunal means situation is equal to the pendency of a de novo inquiry against a civil servant during which period he is deemed to have continued under the suspension and becomes entitled to receive the subsistence allowance. 8. In that case the Karnataka High Court held thus: “The learned counsel for the petitioner contended that there was no justification for granting interim relief. It is on record that on a preliminary issue, the Tribunal by its order dated 12th July, 1984 (annexure-F), held that the domestic inquiry held by the management was invalid. Once the domestic inquiry is held invalid, the Industrial Tribunal is required to held a fresh inquiry. In other words, whether the workman is guilty or not has to be inquired into de novo by the Tribunal. The situation, therefore, is equal to the pendency of a de novo 8 24 wp 3160.11.doc inquiry against a civil servant during which period he is deemed to have continued under suspension and becomes entitled to receive subsistence allowance. Therefore, the awarding of interim relief which is really in the nature of granting subsistence allowance payable during the pendency of the inquiry is justified after the domestic inquiry is set aside. Section 10A, recently introduced into the Industrial Employment (Standing Orders) Act, 1946, reads: “10A. Payment of subsistence allowance. - (1) Where any workman is suspended by the employer pending investigation or inquiry into complaints or charges of misconduct against him, the employer shall pay to such workman subsistence allowance - (a) at the rate of fifty per cent of the wages which the workman was entitled to immediately preceding the date of such suspension, for the first ninety days of suspension; and (b) at the rate of seventy-five per cent of such wages for the remaining period of suspension if the delay in the completion of disciplinary proceedings against such workman is not directly attributable to the conduct of such workman. (2) If any dispute arises regarding the subsistence allowances payable to a workman under sub-section (1), the workman or the employer concerned may refer the dispute to the Labour Court, constituted under the Industrial Disputes Act, 1947 (14 of 1947), within the local limits of whose jurisdiction the 9 24 wp 3160.11.doc industrial establishment wherein such workman is employed is situate and the Labour Court to which the dispute is so referred shall, after giving the parties an opportunity of being heard, decide the dispute and such decision shall be final and binding on the parties. (3) Notwithstanding anything contained in the foregoing provisions of this section, where provisions relating to payment of subsistence allowance under any other law for the time being in force in any State are more beneficial than the provisions of this section, the provisions of such other law shall be applicable to the payment of subsistence allowances in that State. This section incorporates an uniform law governing the payment to subsistence allowance to a workman of an industry during the pendency of a domestic inquiry against him. Therefore, in every case, after the domestic inquiry is set aside and an inquiry into the truthfulness of the charges levelled against the workman is required to be held by the Labour Court/Tribunal, it could, if the workman concerned was not gainfully employed elsewhere, grant an interim relief. In doing so, the quantum of subsistence allowance fixed in section 10-A provides the guidelines. Further, even if the workman is found to be gainfully employed, but is earning a smaller amount, it is reasonable to direct payment of an amount as interim relief which, together with the amount the workman is earning, is approximately equal to the rate prescribed in section 10A.” 10 24 wp 3160.11.doc 9. On the basis of these authorities, the learned counsel appearing on behalf of the Petitioners submits that the impugned order passed by the Industrial Court is liable to be set aside. 10. On the other hand, the learned counsel appearing on behalf of Respondents – employer vehemently opposed the present Petition. He submits that the Industrial Court rightly held that at the time of disposing three Writ Petitions by consent, the High Court has not granted any liberty to the Petitioners to make application for subsistence allowances. He further submits that under section 10-A of the Industrial Employment (Standing Orders) Act, 1946, unless and until there is a relationship of employer and employee, employee is not entitled to any subsistence allowances. He further submits that the enquiry against the Petitioner was already complete and they were suspended by order dated 7th June, 2007; therefore, as on today, there is no relationship of employer and employee between the Petitioners and Respondents. Therefore, the decision of the Industrial Court in Revision Applications are according to law and no interference is required in the present Writ Petition. He further submits that the authorities cited by the learned counsel appearing on behalf of the Petitioners in the matter of Tata Consulting 11 24 wp 3160.11.doc Engineers, Mumbai (supra) and Mysore Cements Limited (supra) are relating to the proceeding under section 33 (2) of the Industrial Disputes Act, 1947. Therefore, both the authorities are not applicable in the present case. 11. I have perused impugned order passed by the Industrial Court, the order passed by the Labour Court dated 26th August, 2010 and the Application filed by the Petitioners for subsistence allowance during the pendency of the matter. It is to be noted that the Industrial Court allowed Respondents’ Revision Application on the ground that it cannot be said at this stage that the suspension of Petitioners is legal or illegal. Paragraph 21 of the said judgment of the Industrial Court reads thus: “21. The very significant aspect of this case is that the Respondent No.1 are terminated due to misconduct. They challenged the enquiry held by Enquiry Officer. At this stage it is not decided whether the charges levelled against Respondent No.1 are legal, proper and correct. Therefore, it cannot be said at this stage that the suspension of the Respondent No.1 is legal or illegal. The misconduct of the Respondent No.1 is not proved till today. Therefore, it cannot be said that his suspension is illegal. Therefore, at this stage the Respondent No.1 are not 12 24 wp 3160.11.doc entitled to get suspension allowance. The main cases of the misconduct are pending in learned Labour Court. Satara.” 12. On bare reading of paragraph 21 of the said judgment, it is clear that the Industrial Court erred in coming to the conclusion that Petitioners are not entitled to suspension allowance only on the ground that it is not decided whether the charges levelled against the Petitioners are legal, proper and correct. It is to be noted that though this court in Writ Petition no. 7425 of 2008 with connected matters by order dated 19th January, 2009 directed the Labour Court to decide the Complaints (ULP) No.43 of 2007, 41 of 2007 and 42 of 2007 within one year. Those are still pending till today. From the copy of Roznama produced by the Petitioners in the Complaints before the Labour Court for the period from 4th July, 2007 till 28th September, 2010, it is clear that the Respondents – employer are every time postponing the hearing and final disposal of the said Complaints on one or other grounds. Apart from that this court by order dated 19th January, 2009 directed Labour Court to decide the respective Complaints afresh from the stage of deposition of the Respondent - Karkhana for proving the alleged misconduct of the Petitioners. Therefore, the Petitioners could make Applications for subsistence allowance as held 13 24 wp 3160.11.doc by our High Court in the matter of Tata Consulting Engineers, Mumbai (supra) and Karnataka High Court in the matter of Mysore Cements Limited (supra). The objections raised by the learned counsel appearing on behalf of Respondents about the maintainability of Petitioners’ Application for subsistence allowance, in view of section 10-A of the Industrial Employment (Standing Orders) Act, 1946, is not tenable because our High Court as well as Karnataka High Court in the above mentioned authorities categorically held that Employee can make an Application for subsistence allowances even during the pendency of litigation before the Labour Court. 13.In view of above mentioned facts and circumstances, Writ Petition is allowed. 14.The impugned order passed by the learned Member, Industrial Court, Satara, in Revision (ULP) No.43 of 2009, 44 of 2009 and 45 of 2009 is set aside. 15.No order as to costs. (K.K. TATED, J.)