Case: Pal Vrs Employees Welfare Association Vs. Premier Automobiles Limited & Another

P.C. The members of the appellant association who are ex-employees of the respondent company, voluntarily retired pursuant to the voluntary retirement scheme announced by the company. Under the said scheme, two options were given to the employees, what is known as "Pension Scheme 1A with full pension" and "Pension Scheme B with 1/3rd commutation and balance 2/3rd Pension". The employees resigned from the service in terms of voluntary retirement scheme. They have received payments as per the scheme and they are paid pension as per their option. It was stated in the letter of acceptance issued by the company that employees would cease to be employees in the company with effect from the date mentioned in the acceptance letter. It appears that the employees of the company who were represented by the Association of Engineering Workers, had submitted a charter of demand on 24th April 1991, the previous settlement having expired on 31st December, 1990. On 8th September 1994 the Union and the respondent company arrived at settlement in the course of conciliation proceedings. The said settlement was signed on 8th September 1994. Clause 19 thereof provides that the company shall pay certain additional payment ranging from Rs.26260 to Rs.38715 depending upon the length of service and said payment shall be payable to all permanent workmen who are on the rolls of the company as on the date of signing of the said settlement dated 8th September 1994. Thus, the said settlement was applicable to the workmen in employment as on 8th September, 1994.2.The appellant-association filed an application under S.33-C(2) of the Industrial Disputes Act, 1947 for grant of benefits under the settlement dated 8th September 1994. The claim of the appellant was based on clause 9 of the Voluntary Retirement Scheme, which reads as follows:"(9) Employees opting for VRS will also be eligible for pro-rata arrears payment for the period upto 27th January 1992 arising out of any settlement reached hereafter. Those separated under VRS before 27th January 1992 will also be eligible for this. However, this will have no effect on the lumpsum/ pension amount arrived at on the basis of the formula as mentioned under clause 3 of the Scheme."Relying upon the aforesaid clause 9 it was contended that while entering into settlement, the Association of Engineering Workers conveniently avoided benefits to the V.R.S. employees by inserting clause 16 into the said settlement thereby making the scheme applicable only to the existing employees i.e. employees who were in employment on 8th September, 1994. It was alleged that clause 16 of the said settlement dated 8th September, 1994, designed to defeat the rights of the members of the appellant and demanded that its members be paid additional payment as per the settlement. The Labour Court accepted the appellants claim and directed the management of the company to pay to the employees all the benefits under the settlement dated 8th September 1994. By the impugned order the learned Single Judge set aside the order of the Industrial Court and dismissed the application preferred by the applicant under S.33-C(2). 3.We have heard the learned counsel appearing for both the parties and perused the judgment of the learned single Judge. The real issue is whether the claim set up by the appellant could have been granted under S.33-C(2) of the Act. It is settled position of law that the power of the Labour Court under S.33-C(2) extends to interpretation of the award or settlement on which the workmens right rests, like the executing Courts power to interpret the decree for the purpose of execution, where the basis of the claim is referable to the award or settlement, but it does not extend to determination of the dispute of entitlement or the basis of the claim if there be no prior adjudication or recognition of the same by the employer. Where the very basis of the claim or the entitlement of the workman to a certain benefit is disputed, there being no earlier adjudication or recognition thereof by the employer, the dispute relating to entitlement is not incidental to the benefit claimed and is, therefore, clearly outside the scope of proceeding under S.33-C(2). The Labour Court has no jurisdiction to first decide the workmens entitlement and then proceed to compute the benefit so adjudicated on that basis in exercise of its power under S.33C(2) of the Act. (See Central Bank of India Ltd. & Ors. v. Rajagopalan (P.S.) & Ors. 1964 (3) SCR 140 and Municipal Corporation of Delhi v. Ganesh Razak & Anr. 1995 1 CLR 171). 4.In the instant case, the settlement dated 8th September 1994 on the basis of which claim has been preferred specifically and unambiguously provides that the benefits arising out of the settlement dated 8th September 1994, would be available to the workmen who were on the rolls of the Company as on 1st July 1994. Thus the settlement dated 8th September 1994 does not confer any right on the members of the appellant.As far as clause 9 of the Voluntary Retirement Scheme is concerned, it merely provides that in case there is settlement in the future, the employees opting V.R.S. will also be entitled to pro-rata arrears for the period upto 27th January 1992 arising out of such settlement. It is thus clear that there is no existing right in the employees to claim the additional amount in accordance with the settlement dated 8th September, 1994. The Labour Court had clearly exceeded jurisdiction in granting the claim of the association. The learned single Judge was therefore, justified in setting aside the said order of the Labour Court.

Decision reasoning: 0[ds]4.In the instant case, the settlement dated 8th September 1994 on the basis of which claim has been preferred specifically and unambiguously provides that the benefits arising out of the settlement dated 8th September 1994, would be available to the workmen who were on the rolls of the Company as on 1st July 1994. Thus the settlement dated 8th September 1994 does not confer any right on the members of the appellant.As far as clause 9 of the Voluntary Retirement Scheme is concerned, it merely provides that in case there is settlement in the future, the employees opting V.R.S. will also be entitled toarrears for the period upto 27th January 1992 arising out of such settlement. It is thus clear that there is no existing right in the employees to claim the additional amount in accordance with the settlement dated 8th September, 1994. The Labour Court had clearly exceeded jurisdiction in granting the claim of the association. The learned single Judge was therefore, justified in setting aside the said order of the Labour Court.