IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.171 OF 2008 The Cosmos Co-operative Bank Ltd. formerly known as the Co-operative Bank of Ahmedabad Limited ...Petitioner Versus The General Federation Maharashtra State Bank Employees Federation ...Respondents ...... Mrs.Meena H.Doshi for Petitioner. Mr.A.V.Bukhari, Sr.Counsel with Mr.Burhan V.Bukhari & Mr.A.S.Peerzada for Respondents. ...... CORAM: A.M.KHANWILKAR, J. CORAM: A.M.KHANWILKAR, J. CORAM: A.M.KHANWILKAR, J. MARCH 11, 2008. MARCH 11, 2008. MARCH 11, 2008. P.C. P.C. P.C. 1. Heard Counsel for the parties. 2. Rule. Mr.B.V.Bukhari waives notice for Respondents. 3. Rule made returnable forthwith by consent and matter is heard for final disposal. : 2 : 4. This Petition takes exception to the Judgment and Order passed by the Presiding Officer, Central Government Industrial Tribunal-II, Mumbai dated November 5, 2007 below Exhibits 18 and 24 in Reference No.CGIT-II/68 of 2003. By the said order, the lower Court rejected the preliminary issue raised on behalf of the Petitioner about the jurisdiction of the Tribunal to try and decide the reference made by the Central Government, which according to the Petitioner was not the appropriate Government. Inasmuch as, the Petitioner being a Multi State Cooperative Society engaged in the business of Bank, the appropriate Government to make reference, for adjudication of the dispute between the Petitioner on the one hand and the workmen on the other, before Tribunal constituted by the State Government, would be the State Government. The Tribunal although opined that the stand taken on behalf of the Petitioner was supported by the decision of the Apex Court in the case of Bharat Co-operative Bank (Mumbai) Ltd. vs. Bharat Co-operative Bank (Mumbai) Ltd. vs. Bharat Co-operative Bank (Mumbai) Ltd. vs. Co-operative Bank Employees Union reported in Co-operative Bank Employees Union reported in Co-operative Bank Employees Union reported in 2007(3) Bom.C.R. 673 2007(3) Bom.C.R. 673 2007(3) Bom.C.R. 673, however, proceeded to hold : 3 : that the said decision cannot have retrospective application to the Notification issued by the Central Government. In that, the reference made by the Central Government on 8th October, 2003 for adjudication of the dispute before the Tribunal constituted by the Central Government, is in anterior point of time; whereas the Apex Court decided the case of Bharat Bank’s case (Supra) Bharat Bank’s case (Supra) Bharat Bank’s case (Supra) at a later point of time, for which reason, the said decision is of no avail. To support this view, the Tribunal has relied on the decision of the Bombay High Court in the case of Saudi Arabian Airlines Saudi Arabian Airlines Saudi Arabian Airlines vs. Shehnaz Mudbhatkal (Mrs.) & Ors. reported in vs. Shehnaz Mudbhatkal (Mrs.) & Ors. reported in vs. Shehnaz Mudbhatkal (Mrs.) & Ors. reported in 1999 (I) C.L.R. 205. 1999 (I) C.L.R. 205. 1999 (I) C.L.R. 205. The Tribunal has further opined that before the decision of the Apex Court in Bharat Bank’s case (supra) Bharat Bank’s case (supra) Bharat Bank’s case (supra), insofar as Cooperative Banks were concerned, the consistent view taken by the Courts was that the appropriate Government in respect of such Banks is the Central Government. The Tribunal also referred to the decision of the Gujarat High Court in the case of Indian Oil Corporation Ltd. vs. Mahendrabhai Indian Oil Corporation Ltd. vs. Mahendrabhai Indian Oil Corporation Ltd. vs. Mahendrabhai R.Patel reported in 1987 (54) FLR 490 R.Patel reported in 1987 (54) FLR 490 R.Patel reported in 1987 (54) FLR 490. : 4 : 5. Having regard to the opinion recorded by the Tribunal, the principal question that would arise for my consideration is: whether the decision of the Apex Court in Bharat Bank’s case Bharat Bank’s case Bharat Bank’s case (supra) (supra) (supra) will have only prospective application and not apply to the Notification issued by the Central Government in anterior point of time, such as in the case on hand. 6. Insofar as the question as to whether the appropriate Government in relation to the Cooperative Banks carrying on business in more than one State, is the Central Government or the State Government, that is no more res integra. The Apex Court in the case of Bharat Bank’s case (supra) Bharat Bank’s case (supra) Bharat Bank’s case (supra) has analysed the relevant provisions of the concerned enactment to conclude that the appropriate Government in relation to a Multi State Cooperative Bank carrying on business in more than one State, would be the concerned State Government. 7. However, Counsel appearing for both sides invited my attention to the legislative changes in relation to the provisions of The Bombay Industrial : 5 : Relations Act, 1946, Bombay Industrial Disputes Act, 1938, The Banking Regulation Act, 1949 as well as the Industrial Disputes Act, 1947 including the decisions which were being followed till recently to treat the Central Government as the appropriate Government. Reference was made to the case of Major Sahakari Bank Ltd. vs. M.N.Majumdar & Anr. Major Sahakari Bank Ltd. vs. M.N.Majumdar & Anr. Major Sahakari Bank Ltd. vs. M.N.Majumdar & Anr. reported in 1955 (II) I.L.J. 755, Cooperative Bank reported in 1955 (II) I.L.J. 755, Cooperative Bank reported in 1955 (II) I.L.J. 755, Cooperative Bank Employees’ Union vs. Saraswat Co-operative Bank Employees’ Union vs. Saraswat Co-operative Bank Employees’ Union vs. Saraswat Co-operative Bank Ltd. & Ors. reported in 1983 (47) F.L.R. 348. Ltd. & Ors. reported in 1983 (47) F.L.R. 348. Ltd. & Ors. reported in 1983 (47) F.L.R. 348. According to the Respondents, having regard to the legislative Scheme applicable in Maharashtra, the inevitable conclusion is that the appropriate Government in relation to Petitioner Bank though a Multi State Cooperative Society, would be the Central Government. The learned Counsel for the Respondent has filed elaborate written submission and was also at pains to persuade me to accept his contention relying on the decisions of our High Court referred to above, however, I am afraid, it is not possible to countenance his submission in view of the direct Judgment of the Apex Court on the point, in the case of Bharat Bank (supra) Bharat Bank (supra) Bharat Bank (supra). : 6 : 8. To get over this position, Counsel for the Respondents has supported the view taken by the Tribunal that the decision of the Apex Court in the case of Bharat Bank (supra) Bharat Bank (supra) Bharat Bank (supra) will be of no avail to the fact situation of the present case, inasmuch as the Notification issued by the Central Government referring the dispute for adjudication between the parties is in anterior point of time. According to the Respondents, no fault can be found with the view taken by the Tribunal that the decision of the Apex Court cannot be applied retrospectively to such Notification which was issued by the Central Government on the basis of the legal position obtaining at the relevant point of time. Learned Counsel has pressed into service reported decisions in the case of Indian Oil Corporation Ltd.(supra), Indian Oil Corporation Ltd.(supra), Indian Oil Corporation Ltd.(supra), Managing Director, ECIL Hyderabad vs. B.Karunakar Managing Director, ECIL Hyderabad vs. B.Karunakar Managing Director, ECIL Hyderabad vs. B.Karunakar reported in 1993 (II) C.L.R. 1129, Saudi Arabian reported in 1993 (II) C.L.R. 1129, Saudi Arabian reported in 1993 (II) C.L.R. 1129, Saudi Arabian Airlines (supra), P.V.George & Ors. vs. State of Airlines (supra), P.V.George & Ors. vs. State of Airlines (supra), P.V.George & Ors. vs. State of Kerala & Ors. reported in 2007 (3) SCC 557, Kerala & Ors. reported in 2007 (3) SCC 557, Kerala & Ors. reported in 2007 (3) SCC 557, Cooperative Bank Employees Union (supra) Cooperative Bank Employees Union (supra) Cooperative Bank Employees Union (supra). 9. On the other hand, Counsel for the Petitioner has pressed into service exposition in : 7 : the case of P.V.George (supra) P.V.George (supra) P.V.George (supra) to contend that the Tribunal committed manifest error in assuming that the decision of the Apex Court in Bharat Bank’s Bharat Bank’s Bharat Bank’s case (supra) case (supra) case (supra) can be applied only prospectively and not to the Notification issued in anterior point of time. 10. After having considered all these decisions, in my opinion, the Judgment of the Apex Court in P.V.George’s case (supra) P.V.George’s case (supra) P.V.George’s case (supra) would answer the controversy as to whether the decision in Bharat Bharat Bharat Bank’s case (supra) Bank’s case (supra) Bank’s case (supra) can be applied only prospectively and not to the Notification issued by the Central Government in anterior point of time. In the first place, it will have to be borne in mind that the decision in Bharat Bank’s case Bharat Bank’s case Bharat Bank’s case (supra) (supra) (supra) essentially interprets the relevant enactment and restates the legal position arising from those provisions from its inception. Besides, the Apex Court in the case of Bharat Bank’s case Bharat Bank’s case Bharat Bank’s case (supra) (supra) (supra) has not even remotely suggested that the principle stated in the said decision will have only prospective application. Moreover, it is common ground that the Apex Court has not expressly : 8 : pronounced that the legal position stated in Bharat Bharat Bharat Bank’s case (supra) Bank’s case (supra) Bank’s case (supra) will have prospective application only. Keeping this position in mind and applying the dictum in the case of P.V.George’s P.V.George’s P.V.George’s case (supra), case (supra), case (supra), I have no hesitation in negating the stand taken by the Respondents or for that matter the opinion recorded by the Tribunal in that behalf. It will be useful to advert to Paragraph 12 of the decision in the case of P.V.George P.V.George P.V.George (supra) (supra) (supra) which reproduces the contention of the Appellants therein. It was argued that the promotions were given to the Appellants on the basis of Law laid down by the Kerala High Court in Daniel and Ravindran’s case for which reason, the Law declared by the Full Bench subsequently in the year 2005 cannot be made applicable to them. This contention has been rejected by the Apex Court. In Paragraph 14, the Apex Court observed thus : "14. For the views we propose to take, it is not necessary for us to consider all the decisions relied upon by Mr.Rajan. The legal position as regards the applicability of doctrine of prospective overruling is no longer res integra. This Court in exercise of its jurisdiction under Article 32 or Article 142 of the Constitution of India may declare a law to : 9 : have a prospective effect. The Division Bench of the High Court may be correct in opining that having regard to the decision of this Court in Golak Nath v. State of Punjab the power of overruling is vested only in this Court and that too in constitutional matters, but the High Courts in exercise of their jurisdiction under Article 226 of the Constitution of India, even without applying the doctrine of prospective overruling, indisputably may grant a limited relief in exercise of their equity jurisdiction." . It will be also useful to refer to Paragraphs 19, 21, 25, 26 and 29 which read thus: "19. It may be true that when the doctrine of stare decisis is not adhered to, a change in the law may adversely affect the interest of the citizens. The doctrine of prospective overruling although is applied to overcome such a situation, but then it must be stated expressly. The power must be exercised in the clearest possible term. The decisions of this Court are clear pointer thereto". "21. The ratio laid down by this Court, as noticed hereinafter, categorically shows the effect of a decision which had not been directed to have a prospective operation. The legal position in clear and unequivocal term was stated by a Division Bench of this Court in M.A. Murthy v. State of Karnataka & Others [(2003) 7 SCC 517] in the following terms : (SCC pp.520-21, para 8) "8. The learned counsel for the appellant submitted that the approach of the High Court is erroneous as the law : 10 : declared by this Court is presumed to be the law at all times. Normally, the decision of this Court enunciating a principle of law is applicable to all cases irrespective of its stage of pendency because it is assumed that what is enunciated by the Supreme Court is, in fact, the law from inception. The doctrine of prospective over-ruling which is a feature of American jurisprudence is an exception to the normal principle of law, was imported and applied for the first time in L.C. Golak Nath and Ors. v. State of Punjab and Anr. In Managing Director, ECIL, Hyderabad and Ors., v. B. Karunakar and Ors., the view was adopted. Prospective over-ruling is a part of the principles of constitutional canon of interpretation and can be resorted to by this Court while superseding the law declared by it earlier. It is a device innovated to avoid reopening of settled issues, to prevent multiplicity of proceedings, and to avoid uncertainty and avoidable litigation. In other words, actions taken contrary to the law declared prior to the date of declaration are validated in larger public interest. The law as declared applies to future cases. (See Ashok Kumar Gupta v. State of U.P. and Baburam v. C.C. Jacob. It is for this Court to indicate as to whether the decision in question will operate prospectively. In other words, there shall be no prospective over-ruling, unless : 11 : it is so indicated in the particular decision. It is not open to be held that the decision in a particular case will be prospective in its application by application of the doctrine of prospective over-ruling. The doctrine of binding precedent helps in promoting certainty and consistency in judicial decisions and enables an organic development of the law besides providing assurance to the individual as to the consequences of transactions forming part of the daily affairs. That being the position, the High Court was in error by holding that the judgment which operated on the date of selection was operative and not the review judgment in Ashok Kumar Sharma’s case No. II. All the more so when the subsequent judgment is by way of Review of the first judgment in which case there are no judgments at all and the subsequent judgment rendered on review petitions is the one and only judgment rendered, effectively and for all purposes, the earlier decision having been erased by countenancing the review applications. The impugned judgments of the High Court are, therefore, set, aside." "25. In service matters, this Court on a number of occasions have passed orders on equitable consideration. But the same would not mean that whenever a law is declared, it will have an effect only because it has taken a different view from the earlier one. In those cases it is categorically stated that it would have : 12 : prospective operation." "26. We are not oblivious that in Union of India v. Madras Telephone SC & ST Social Welfare Association [2006) 9 SCALE 626], this Court observed that where the rights had been determined in favour of some employees in a duly constituted proceeding, which determination had attained finality, a subsequent judgment of a Court or Tribunal taking a contrary view would not adversely affect the applicants in whose cases the orders had attained finality." "29. Moreover, the judgment of the Full Bench has attained finality. The special leave petition has been dismissed. The subsequent Division Bench, therefore, could not have said as to whether the law declared by the Full Bench would have a prospective operation or not. The law declared by a court will have a retrospective effect if not otherwise stated to be so specifically. The Full Bench having not said so, the subsequent Division Bench did not have the jurisdiction in that behalf." (emphasis supplied) 11. It is thus well established position that the Law declared by the Apex Court will have retrospective effect, if not otherwise stated to be so specifically in the said decision itself. Keeping in mind the said legal position, it is not open to the Respondent to contend to the contrary. The view so taken by the Tribunal, therefore, is manifestly wrong and cannot be sustained. : 13 : 12. Much emphasis has been placed by the Tribunal on the observations in the case of Saudi Saudi Saudi Arabian Airlines (supra). Arabian Airlines (supra). Arabian Airlines (supra). However, what has been overlooked is that the said decision deals with the change brought about by legislative amendment. Indeed, such change will be governed by the concerned amending Act as well as the provisions of the General Clauses Act. However, that analogy will be inapposite in respect of Judgment of the Court which interprets relevant provisions and restates the position obtaining on account of the legal provisions from its inception. 13. Insofar as the decision in the case of Managing Director, ECIL Hyderabad (supra) Managing Director, ECIL Hyderabad (supra) Managing Director, ECIL Hyderabad (supra) is concerned, the said decision has been adverted to by the Apex Court in its recent decision in P.V.George’s case (supra) P.V.George’s case (supra) P.V.George’s case (supra) in Para 21. Insofar as the other decisions pressed into service on behalf of the Respondents, the same deal with the view which prevailed in relation to the appropriate Government of a Banking Company and a Cooperative Society engaged in banking business. As aforesaid, : 14 : after the recent decision of the Apex Court in Bharat Bank’s case (supra) Bharat Bank’s case (supra) Bharat Bank’s case (supra), it is unnecessary to burden this Judgment with the said aspect. Suffice it to observe that insofar as the case of Major Major Major Sahakari Bank Ltd. (supra) Sahakari Bank Ltd. (supra) Sahakari Bank Ltd. (supra), the Court was not called upon to consider the case of a Cooperative Bank having branches in more than one State. The exposition in the said decision, therefore, will have to be confined to the situation where the Cooperative Bank does not have branches in more than one State. Insofar as Cooperative Banks having branches in more than one State are not governed by the provisions of Bombay Industrial Relations Act after 1949 by virtue of the proviso introduced by the amending Act of 1949. Significantly, the Banking Regulation Act (earlier known as Banking Companies Act) was also brought into force in the year 1949. Till 1965, Cooperative Societies were not governed by the Banking Regulation Act, however, on account of the amendment made in terms of Act No.3 of 1965, which came into force from 1st March 1966, introducing amendment to Section 56 and Section 3 of the said Act, which provided that the provisions of the Act : 15 : would not apply to certain Cooperative Societies enumerated therein except in manner and to the extent specified in the Act. 14. I find substance in the stand taken on behalf of the Petitioner that insofar as the case of Cooperative Bank Employees Union (supra) Cooperative Bank Employees Union (supra) Cooperative Bank Employees Union (supra), this Court was not called upon to consider the efficacy of Section 2(bb) of the said Act. That question has now been answered by the Apex Court in Bharat Bharat Bharat Bank’s case (supra) Bank’s case (supra) Bank’s case (supra) which unambiguously expounds that insofar as Multi State Cooperative Banks are concerned, the appropriate Government would be the concerned State Government having regard to Section 2(bb) of the Industrial Disputes Act. 15. A priori, the view taken by the Tribunal that the decision of the Apex Court in the matter of Bharat Bank’s (supra) Bharat Bank’s (supra) Bharat Bank’s (supra) would apply only prospectively and not to the Notification issued in the present case, will have to be stated to be rejected. 16. Counsel for the Respondents lastly submits : 16 : that if the Court was to reverse the decision of the Tribunal, may consider exercising discretionary powers to do substantial justice between the parties and issue necessary directions to transfer the reference pending before the Central Government Industrial Tribunal constituted by the Central Government to the State Government Industrial Tribunal constituted by the State Government to be proceeded further from the stage of filing of pleadings. According to the Respondents, the dispute raised by the Respondents pertains to 59 employees who were illegally retrenched by the erstwhile Cooperative Bank of Ahmedabad Limited while working at their Mumbai Branches, which Bank has since merged with the Petitioner Bank. According to the Respondents, the dispute was taken in conciliation before the Regional Labour Commissioner appointed by the Central Government and on failure of conciliation, the Central Government referred the Industrial Dispute for adjudication to the Central Government Industrial Tribunal under reference order dated 8th October 2003 directing passing of Award within a period of three months. It is submitted that inspite of such : 17 : peremptory directions, the Respondents are still waiting for justice. Keeping that in mind, contends learned Counsel for the Respondent, the Respondents should not be relegated to a situation of making fresh application to the appropriate authority of State Government for conciliation and upon failure of conciliation requiring the State Government to refer the dispute for adjudication to the Tribunal. All this would take further time, which is avoidable. Inasmuch as, there can be no two opinions that there exists a dispute and there is no possibility of conciliation which was already attempted once and failed. The Respondents, therefore, submits that instead of relegating the Respondents to such a situation, this Court in exercise of its discretionary powers, issue appropriate directions so that the reference proceedings would now proceed from the stage of filing of pleadings before the State Government Industrial Tribunal. He submits that this course will not cause any prejudice to the Petitioner or any other party. In support of this submission, Counsel for the Respondents has pressed into service decision of the Apex Court in the case of : 18 : Gujarat Steel Tubes Ltd., etc. etc. vs. Gujarat Gujarat Steel Tubes Ltd., etc. etc. vs. Gujarat Gujarat Steel Tubes Ltd., etc. etc. vs. Gujarat Steel Tubes Mazdoor Sabha & Ors. reported in 1980 Steel Tubes Mazdoor Sabha & Ors. reported in 1980 Steel Tubes Mazdoor Sabha & Ors. reported in 1980 Lab.I.C. 1004 Lab.I.C. 1004 Lab.I.C. 1004 and another decision of the Apex Court in the case of P.V.George (supra) P.V.George (supra) P.V.George (supra), in particular para 14 thereof. Reliance is also placed on the decision of the Apex Court in the case of Employees State Insurance Corporation & Employees State Insurance Corporation & Employees State Insurance Corporation & Anr. vs. Jardine Henderson Staff Association & Anr. vs. Jardine Henderson Staff Association & Anr. vs. Jardine Henderson Staff Association & Ors. reported in 2006 (6) S.C.C. 581 Ors. reported in 2006 (6) S.C.C. 581 Ors. reported in 2006 (6) S.C.C. 581 in particular, Paragraphs 59 and 63 thereof. 17. The abovesaid argument of the Respondents, though attractive, cannot be accepted. Inasmuch as, the Petitioner has rightly pressed into service exposition of the Apex Court in the case of Rashtriya Chemicals & Fertilisers Ltd. & Anr. vs. Rashtriya Chemicals & Fertilisers Ltd. & Anr. vs. Rashtriya Chemicals & Fertilisers Ltd. & Anr. vs. General Employees’ Association & Ors. reported in General Employees’ Association & Ors. reported in General Employees’ Association & Ors. reported in 2007 (113) FLR 972 2007 (113) FLR 972 2007 (113) FLR 972 which restates the consistent view that the High Court will not straightaway direct the appropriate Government to refer the dispute. If the submission made on behalf of the Respondents was to be accepted, inevitably, this Court would be directing the State Government to make reference in relation to the dispute for : 19 : adjudication to the State Government Industrial Tribunal constituted by the State Government. Besides, the analogy of requiring the Plaintiff to present the Plaint before the Court of competent jurisdiction,