Case: Maharashtra General Kamgar Union Vs. Universal Dyeing & Printing Works & Another

ORAL JUDGMENTMajithia, J.The petitioner, Maharashtra General Kamgar Union, has challenged the order of the Industrial Court dated November 4,1992, passed in Complaint (ULP) No. 1659 of 1990, in this writ petition under Article 226 of the Constitution of India.2.The factual matrix is as under :-Respondent No.1 (hereinafter "the respondent"), at the relevant time, employed about 250 workmen. Some of these workmen were retrenched with effect from July 26, 1984 and some with effect from July 30, 1984. Those workmen challenged the action of the respondent in applications under Sections 78 and 79 read with Section 42(4) of the Bombay Industrial Relations Act, 1946. The contention of the workmen in substance was that the termination was illegal whereas the respondents contention was that the retrenchment was made after complying with the provisions of Section 25F of the Industrial Disputes Act.It was also contended by the respondent that the workmen did not issue to it approach notice before the applications. In the light of the pleas in the pleadings, the Labour Court framed the following issues :-"1) Do the applicants prove that they have been retrenched from the services illegally2) Does the Opponent prove that the retrenchment from the service was legally done"On Issue No.1 it was held that the workmen were legally retrenched from service. On Issue No.2 it was held that the workmen had not led positive and reliable evidence about the compliance of section 42(4) of the Bombay Industrial Relations Act. Since the issue was not proved by the workmen, it was answered in the negative and in favour of the respondent-company. The Labour Court dismissed these applications vide order dated July 29,1988. Aggrieved against this common order, the workmen filed appeals before the Industrial Court. The Industrial Court endorsed the conclusions arrived at by the Labour Court that the retrenchment was valid and was effected after complying with Section 23F of the Industrial Disputes Act (for short "the Act"). The appeals were dismissed vide order dated July 24, 1989. The judgment of the Industrial Court was challenged in this Court in Writ Petition No. 362 of 1990. The learned single Judge rejected the writ petition observing thus :-" Rejected.The two authorities below have recorded concurrent findings of facts, and the findings are correct.The workmen did not serve approach notice and therefore applications were not maintainable under B.I.R. Act. Even otherwise on merits the retrenchment was due to shortage of work and provisions of Section 25F are complied with."The decision of the Single Judge rejecting the writ petition was assailed in Appeal No. 1288 of 1990. The Division Bench of this Court dismissed the same observing thus :-"Hearing Counsel on either side and going through the impugned judgment of the Labour Court confirmed in appeal by the Industrial Court, the learned Single Judge was justified in dismissing the writ petition therefrom. The contention of learned Counsel that there was no issue before the Labour Court on the question of approach notice is too late to be urged in this appeal. Nothing prevented the appellants-petitioner from urging the said question in appeal. The question not urged in appeal. What is more, even in the writ petition the said question was not raised. It is too late in the day to permit the petitioners to raise this question in this appeal against the dismissal of the writ petition. The question was not raised in appeal from the Labour Courts judgment and not raised in the writ petition from the Industrial Courts judgment cannot be permitted to be raised for the first time in this appeal against the dismissal of the writ petition.2. The appeal thus fails and the same is dismissed."3.The petitioner, Maharashtra General Kamgar Union, which is espousing the cause of the workmen who had been unsuccessful before the Labour Court, Industrial Court, single Judge of this Court and Division Bench of this court, filed complaint (ULP) No.1659 of 1990 under items 5 and 9 of Schedule IV of the Maharashtra Recognition of Trade Unions & Prevention of Unfair Labour Practices Act, 1971 (for short "the MRTU & PULP Act"). In the complaint it was, inter alia, stated that the respondent-company had employed about 250 workmen in July 1984 and out of these workmen, the respondent-company terminated the services of 165 workmen on the purported ground of retrenchment. Out of these 165 workmen, around 142 workmen initiated proceedings under the Bombay Industrial Relation Act,1946. These applications met the fate as hereinbefore stated. The Union further stated that the respondent-company engaged itself in unfair labour practice from September 1989 and the unfair labour practice is still continuing. According to the union, the respondent started its manufacturing activities in September 1989 and employed 60 new workmen and at the time of filing the complaint there were 78 workmen, 36 were workmen who were earlier removed but were re-employed. Not giving employment to the remaining workmen has resulted in unfair labour practice. Along with the complaint, a list of workmen was also filed.4.The respondent-company controverted the pleas of the petitioner-union. The Industrial Court formulated the following points for consideration :-"(i) Does the complainant prove that there is sufficient cause for not filing the complaint in time, and therefore, the application for condonation of delay deserves to be granted(ii)Whether the complaint is barred by principle of res judicata, as similar kind of relief has already been claimed and rejected by the High Court, in Appeal No. 1288 of 1990"Point No.1 was answered in favour of the petitioner and point No. 2 was answered in favour of the respondent. The Industrial Court held that the remedy available under Section 25-H of the Act was rejected by the single Judge and that decision was upheld by the Division Bench. It will be useful to reproduced the conclusions of the Industrial Court which are as under :-"25. Section 59 of the MRTU & PULP Act, 1971 provides for a bar of proceeding under Bombay or Central Act.It is significant to note and remember that even though the remedy about the application of Section 25-H has been sought for by way of making grounds in the Writ Petition and in appeal, it has not been granted by the Honble Single Judge or Division Bench of the High Court. It cannot be said that the said grounds were not considered by the High Court, as no finding has been given by the Honble High Court. By implication it has to be presumed and treated that whatever has been stated in the Appeal grounds have been considered on merits and when the relief is not granted the grounds have been turned down.Consequently the logical position boils down to this that once the remedy claimed under section 25-H of I.D.Act has been turned down by the Honble Single Judge and Division Bench of the High Court, the question of filing the complaint under the provisions of MRTU & PULP Act, 1971 for similar kind of relief does not arise. If such complaints are entertained by the courts of law, then there will be no end to the litigation and it will tantamount to prevail upon the relief already not granted by the Honble High Court.Therefore, even though the complainant is found to have succeeded in establishing a satisfactory cause for condonation of delay, the complainant seems to be quite unfortunate in convincing the court that the complaint is tenable, and there is no bar of principle of res judicata and bar of section 59 of the MRTU & PULP Act, 1971. Thus, though the complainant is winning on one front, he is losing one most important front about the tenability of the complaint itself. Hence, the complaint as such will have to be dismissed, being not tenable. ... ... ...These observations indicates that the Industrial Court opined that the plea covered by Section 25-H of the Act was raised, adjudicated upon and finally decided and, as the plea was finally decided, the decision in the earlier proceedings operates as res judicata in the instant proceedings.5.Before we deal with the legal question arising in this petition, it has become necessary to go backward. The workmen, whose cause is being expoused by the petitioner, were retrenched from service with effect from July 26, 1984 and July 30, 1984. The retrenchment orders/notices were challenged under section 78 of the Bombay Industrial Relations Act. The only question which was raised and adjudicated upon was whether the retrenchment had been ordered after following due process of law. The Labour Court and the Industrial Court upheld the contention of the management that the retrenchment was ordered after complying with the provisions of Sections 25-F of the Act. Before the single Judge of this Court, it was agitated by the workmen that the plea whether approach notice was given or not was never put in issue. The learned Judges constituting the Division Bench observed that this question cannot be gone into in appeal arising in writ proceedings. No other question was agitated in this Court. This Court only answered the question that was raised before it that the retrenchment was made after complying with the provisions of Section 25-F of the Act. The plea which has been raised in these proceedings is that the respondent-company started its manufacturing activities in September 1989 and that it had employed 78 workmen and out of these 78 workmen, 36 workmen are those who were retrenched earlier and they were given employment. The petitioner says : not giving employment to the other workmen who were retrenched on identical grounds as those who have been taken back in service, amounts to victimization. The plea of the petitioner as unfolded in the complaint is squarely based on Section 25-H of the Act which reads thus :-"25H. Re-employment of retrenched workmen. Where any workmen are retrenched, and the employer proposes to take into his employ any persons, he shall in such manner as may be prescribed, give an opportunity to the retrenched workmen who are citizens of India to offer themselves for re-employment, and such retrenched workmen who offer themselves for re-employment shall have preference over other persons."The opportunity as enjoined by this section has to be given to the retrenched workmen after the employer decides to proceed with his manufacturing activities. The case of the respondent has throughout been that in view of the recession in the market, it curtailed its manufacturing activities and that reduction in manufacturing activities necessitated retrenchment of the employees. Once the company decides to recommence its manufacturing activities and to give employment to persons, the condition precedent as enjoined under Section 25-H has to be complied with. It cannot be disputed that this plea was not available to the workmen in 1984 when the retrenchment orders/notices were issued. It became available to them only after the manufacturing activities were started in September 1989. What was in issue in the earlier proceedings was whether the retrenchment was valid and not whether the retrenched workmen have to be offered employment as envisaged by Section 25-H of the Act. In order to attract the plea of res judicata, it is necessary to establish that the matter was in issue in the former proceedings and the matter must have been in issue directly and substantially. A matter cannot be said to be directly or substantially in issue in a suit or lis unless it was alleged by one party and denied or admitted, either expressly or by necessary implication, by the other. It is not enough that the matter was alleged by one party. The word `substantial means of importance and value. A matter is substantially in issue if it is of importance and value for the purpose of decision of the main proceedings. The question raised in the instant proceedings was not even remotely raised before the Labour Court or the Industrial Court or this Court in the earlier proceedings. The conclusion arrived at by the Industrial Court that the decision in the earlier proceedings operates as res judicata is not only illegal but factually incorrect.

Decision reasoning: 1[ds]The opportunity as enjoined by this section has to be given to the retrenched workmen after the employer decides to proceed with his manufacturing activities. The case of the respondent has throughout been that in view of the recession in the market, it curtailed its manufacturing activities and that reduction in manufacturing activities necessitated retrenchment of the employees. Once the company decides to recommence its manufacturing activities and to give employment to persons, the condition precedent as enjoined under Sectionhas to be complied with. It cannot be disputed that this plea was not available to the workmen in 1984 when the retrenchment orders/notices were issued. It became available to them only after the manufacturing activities were started in September 1989. What was in issue in the earlier proceedings was whether the retrenchment was valid and not whether the retrenched workmen have to be offered employment as envisaged by Sectionof the Act. In order to attract the plea of res judicata, it is necessary to establish that the matter was in issue in the former proceedings and the matter must have been in issue directly and substantially. A matter cannot be said to be directly or substantially in issue in a suit or lis unless it was alleged by one party and denied or admitted, either expressly or by necessary implication, by the other. It is not enough that the matter was alleged by one party. The word `substantial means of importance and value. A matter is substantially in issue if it is of importance and value for the purpose of decision of the main proceedings. The question raised in the instant proceedings was not even remotely raised before the Labour Court or the Industrial Court or this Court in the earlier proceedings. The conclusion arrived at by the Industrial Court that the decision in the earlier proceedings operates as res judicata is not only illegal but factually incorrect.