Case: Paint Employees Union Vs. Kansai Nerolac Paints Limited

not possible for any one to contest the proposition that a wrong concession made by a party or its advocate on a statutory provision cannot bind them. However, in our opinion, facts of this case are different. We are not concerned here with merely a concession made by a counsel. The appellant union took a stand that under Section 25-O(5), the Specified Authority can review its order and also make a reference and that the Specified Authority had in fact reviewed its order on the basis of judgment of this court in Cable Corporations case which held the field at that time. We have already noted that this legal stand of the appellant union is reflected in its arguments filed before the Tribunal and in its affidavit-in-reply filed in this court. Thus the concession flows from the pleadings of the parties. The appellant union accepted the factual existence of a valid review order and thereafter sought to defend its stand on the basis of this courts judgment in Cable Corporations case. After the Supreme Court set aside this courts judgment in Cable Corporations case the appellant-Union is trying to contend that such statement was never made. In any case it is pertinent to note that in Commissioner of Endowments case (supra) the Supreme Court has observed that a party may resile from a concession of law but it cannot call in question the very fact of making the concession as recorded in the judgment. We may also mention that in Writ Petition No. 1794 of 2008 which is filed by the appellant union prior to the filing of this appeal, the appellant Union proceeded on the basis that there is a factual order of review. It only seeks to contend that the said order has been passed illegally. The conclusion is inevitable that the appellant union is adopting inconsistent stands and its conduct reflects on the credibility of its case.33. It is then submitted by Ms. Doshi that in Orissa Textiles case (supra) the Supreme Court found that the recast provision of Section 25-O after its amendment is constitutionally valid on various grounds including the ground as regards the provision specifically made for a review or a reference under Section 25-O (5). She submitted that by interpreting the order of the Specified Authority in the manner suggested by the respondent company, the workmen would be deprived of the said remedy which was found to be a necessary remedy by the Supreme Court.34. It is not possible to accept this argument. Undoubtedly the remedy of review or reference is a valuable remedy. But the legal position is clarified by the Supreme Court in Cable Corporations case (supra). The two remedies are alternative remedies. If review jurisdiction is exercised and review application is rejected then there can be no further order of reference. In this case there is no question of denial of remedy to the appellant union. The application of the appellant union has been considered by the Specified Authority and the Specified Authority has rejected it. The appellant union adopted the remedy available in law and the Specified Authority adjudicated the application. Once Specified Authority considers the application of the appellant union merely because the decision of the Specified Authority is against the appellant union it cannot contend that it was deprived of the valuable right of review. We have already concluded that the Specified Authority exercised its review jurisdiction and rejected the review application. The order of the Specified Authority cannot be interpreted in any other way. Any attempt made by us to interpret it differently would be doing violence to the law settled by the Supreme Court in Cable Corporations case (supra).35. Ms. Doshi submitted that in the reference made under Section 25-O(5) the Tribunal has in fact found that the reasons seeking permission to effect closure are neither genuine nor adequate and not in public interest. The Tribunal found that the termination orders issued to the workmen were illegal and that the workmen were entitled to wages and other benefits from 2/5/03 as they are deemed to have been continued in service. Ms. Doshi pointed out that the amount which the workmen are entitled to receive works out to approximately Rs.7.8 crores. Ms. Doshi submitted that while admitting the appeal this court has directed the respondent company to furnish security to the satisfaction of the Prothonotary & Senior Master of this court to protect the interest of the workmen. Learned counsel pointed out that the workmen are without job since 2003.36. Learned counsel further pointed out that after the rejection of the reference the respondent company has purported to effect the closure vide its notice dated 20/6/07 without prejudice to the earlier closure. Ms. Doshi submitted that when the reference was made this courts judgment in Cable Corporations case (supra) was holding the field and, therefore, the reference made in the light of that judgment was legal. Learned Counsel urged that it is necessary to adjudicate the legality and propriety of the award dated 5/5/07 made by the Tribunal on merits because in the proceedings initiated by the appellant union challenging the purported closure as per the notice dated 20/6/07 the legality and propriety of the closure effected in 2003 cannot be gone into by the Industrial Court.37. We are not impressed by this submission. The Tribunal made its award pursuant to the Specified Authoritys order dated 24/4/03. Once that order is found to be illegal, the award must fall to the ground. This is a settled legal position which cannot be overlooked. If the award goes, the consequences must follow. The argument that the reference order is in consonance with this courts judgment in Cable Corporations case which held the field at that time and, therefore, the reference is legally valid is fallacious. The legal position has been clarified by the Supreme Court now and what preceded the reference order must be examined in the light of the Supreme Courts judgment in Cable Corporations case (supra).

Decision (1 = appeal accepted, 0 = rejected): 0

Explanation:
0[ds]20. It is now necessary to refer to the facts of this case. The appellant union has prayed in its application that the Specified Authority may review its order dated 27/3/03 granting permission to close down the Lower Parel unit or in the alternative it may refer the matter to the Industrial Tribunal. In the words of Ms. Doshi counsel appearing for the appellant union it is a consolidated application seeking a review or a reference under SectionMs. Doshi argued that in the case of a consolidated application the Specified Authority has to either say yes to one prayer and no to another prayer. She submitted that in this case the Specified Authority has decided to refer the case. There is no categoric rejection of the review application. It has decided to choose one option i.e. to refer the matter to the Industrial Tribunal. Ms. Doshi submitted that one cannot read one observation made by the Specified Authority in isolation thereby ignoring the final conclusion reached by it to refer the matter. Ms. Doshi submitted that while considering application under Sectionthe Specified Authority has to consider the same factors which it has to consider while deciding an application under Sectionseeking permission to close down an undertaking i.e. (a) whether the reasons are genuine (b) whether the reasons are adequate (c) whether granting permission is in general public interest and (d) other relevant factors. She submitted that in this case the Specified Authority has not categorically rejected the application. It has stated that it was of the opinion that judicial scrutiny is required and has referred the matter for adjudication. There is no finality to its order in the sense that the order indicates that the Specified Authority was of the opinion that since judicial scrutiny is required there is no need to review the order. Mr. Cama, learned counsel for the respondent company on the other hand relied on Cable Corporation case (supra) and submitted that the above argument of Ms. Doshi must be rejected in view thereof. Relying on the Supreme Courts judgment in National Insurance Co. Ltd. v. MastanAnr. (2006) 2 SCC 641  , Mr. Cama submitted that a party must in law elect one of the two available remedies. If it does not expressly elect in its application as to whether it seeks a review or a reference it runs the risk of the Government taking up the matter by way of a review and by rejection thereof precluding an order of reference.21. It is difficult to accept the submission of Ms. Doshi that since the application was a composite application, the Specified Authority has to say yes to one prayer and no to other. This view will run counter to the authoritative pronouncement of the Supreme Court in Cable Corporations case (supra). At the cost of repetition, it must be stated that in that judgment the Supreme Court has referred to its judgment in Fakir Mohd. (dead) by Lrs. v. Sita Rani, 2002 (1) SCC 741  , where it was held that the word or is normally disjunctive. The use of the word or in a statute manifests the legislative intention of the alternatives prescribed under law. The Supreme Court has observed that had the legislature intended that the reference could be made after the Specified Authority deals with the review power, it would have said so specifically by specific words. It could have provided for a direct reference. These observations of the Supreme Court make it clear that, if the Specified Authority exercises its review power it cannot make a reference. Now to ascertain whether the Specified Authoritys order is in consonance with the judgment of the Supreme Court in Cable Corporations case (supra) or not, it is necessary to quote the relevant paragraphs of the Specified Authoritys order dated 24/4/03. They read as under:"As regards various prayers made by the Applicant Union in the review and stay application, I have to state that there is no provision under Sectionof the Industrial Disputes Act, 1947 to grant such prayers, therefore, I am of the opinion that various prayers made by the Applicant Union cannot be granted. I am also of the opinion, that the Applicant Union has not made out a case for review of the order dated 27/3/2003."I have gone through the submissions made by both the parties in the instant matter and have come to the conclusion that the matter needs judicial scrutiny.Hence, I pass the following order:ORDERThe matter in the application dated 27/1/03 of M/s. Goodlas Nerolac Paints Ltd., Ganpatrao Kadam Marg, Lower Parel, Mumbai 400 013 under Sectionof the Industrial Disputes Act, 1947 seeking permission of closure of its Lower Parel Unit situated in the abovementioned address is hereby referred under Sectionof the said Act to the Industrial Tribunal, Mumbai consisting of Sou. S. V. Ayarekar."22. There is no dispute about the fact that the reference made by the Specified Authority in its order to various prayers made in the application and its observation that for those prayers there is no provision under Sectionof the said Act, relate to prayers regarding interim relief. The question is whether the sentence "I am also of the opinion, that the Applicant Union has not made out a case for review of the order dated 27/3/2003", should be read as rejection of the prayer for review or not. We have no doubt that when the Specified Authority expresses its opinion, that no case is made out for review, it exercises its jurisdiction to deal with the review application and rejects it. Merely because it does not categorically state that review application is rejected, it cannot be said that review application is not rejected. The opinion expressed by the Specified Authority is not worthless. The law contemplates that, if it expresses that in its opinion, no case for review is made out, the matter must end there. Once it expresses opinion, that no case for review is made out the application cannot be processed further. It is not possible to interpret this order to mean that the Specified Authority proceeded on the basis that since judicial scrutiny is required it need not review the order. In this case when the Specified Authority expresses that no case for review is made out, it is clear that it has applied its mind to the rival contentions which it has reproduced in detail and formed an opinion. It has dealt with the application. It has exercised its review jurisdiction and rejected it. The order is susceptible to no other inference.23. We must, however, record that in our opinion the doctrine of election has no application here and the reliance placed by Mr. Cama on National Insurance Cos case (supra) is totally misplaced. In that case the court was considering two remedies available to an injured workman to get compensation. He is entitled for compensation under the Workmens Compensation Act, 1923 and also under the Motor Vehicles Act, 1988. Under Section 167 of the Motor Vehicles Act, 1988 the aggrieved party has the option to elect either of them but not both. Observations of the Supreme Court will have to be read against the background of these facts. We are not concerned here with a provision akin to Section 167 of the Motor Vehicles Act, 1988. The said judgment has, therefore, no application to this case.24. It is pointed out by Mr. Cama that before the Tribunal, the appellant union had conceded that the Specified Authority had decided the review application on merits. This is recorded by the Tribunal in its order. In the impugned order learned Single Judge has also said so. Mr. Cama submitted that the appellant union is estopped from taking a contrary stand now.25. It is pertinent to note that in the statement of claim filed by the respondent company in the reference which was decided by the Industrial Tribunal pursuant to the Specified Authoritys order dated 24/4/03, the respondent company clearly stated that the Specified Authority had rejected the review application, however, in view of the mandatory provision of Sectionof the said Act, the Specified Authority had referred the matter of permission for closure to the Tribunal. Even in its written arguments filed before the Tribunal, the respondent company specifically raised this contention. It is significant to note that the appellant union in its written arguments filed before the Tribunal stated that scope of sectionis akin to the powers of the Tribunal under Section 10 of the said Act and as such the Tribunal would have the same powers under Sectionof the said Act. Reliance was placed by the appellant union on the judgment of this court in Cable Corporations case. Obviously it is on this basis that the Tribunal observed in its award dated 29/4/03 that it was not disputed that the Specified Authority decided the review application on merits.26. It is equally important to note that in the affidavit in reply dated 6/9/07 filed in Writ Petition No.1332 of 2007, the appellant Union has reiterated the same submission. Reliance is placed on this courts judgment in Cable Corporations case. The point to note is that in paragraph 21 of the Tribunals award, the Tribunal has recorded that it is not disputed that the Specified Authority decided the review application on merits. In paragraph 6(1) of the affidavit in reply there is a reference to the said paragraph 21. However, it is not stated that the appellant union had not disputed that the review application was decided on merits. On the contrary it is stated that the contention raised by the respondent company that after hearing the review application on merits, the Specified Authority has no power to make reference has been rejected by the Tribunal and this finding cannot be characterized as misdirection in law on the part of the Tribunal. It appears that after considering the pleadings, more particularly the affidavit in reply filed by the appellant union and after hearing learned counsel for the parties, learned Single Judge has observed in the impugned order that it was not disputed before the Tribunal that the Specified Authority has decided the review application on merits. In our opinion, there is strong basis for the above observation made by the Tribunal as well as by learned Single Judge.It is well settled that if a party feels that any statement made by him or his counsel has been wrongly recorded in the judgment it has to approach the same learned Judge to get the order corrected. In State of Maharashtra v. Ramdas Shrinivas Nayak, 1982 (2) SCC 463  , the Supreme Court dealt with this point. We may quote the relevant observation of the Supreme Court."If a party thinks that the happening in court have been wrongly recorded in a judgment, it is incumbent upon the party, while the matter is still fresh in the minds of the judges, to call the attention of the very judges who have made the record to the fact that the statement made with regard to his conduct was a statement that had been made in error (per Lord Buckmaster in Madhu Sudan Chowdhri v. Chandrabati Chowdhrain). That is the only way to have the record corrected. If no such step is taken, the matter must necessarily end there. Of course a party may resile and an appellate court may permit him in rare and appropriate cases to resile from a concession on the ground that the concession was made on a wrong appreciation of the law and had led to gross injustice; but he may not call in question the very fact of making the concession as recorded in the judgment."29. The above judgment was followed by the Supreme Court in Commissioner of EndowmentsOrs. v. Vithal RaoOrs., (2005) 4 SCC 120.   It was, therefore, necessary for learned counsel for the appellant union to approach learned Single Judge and get the order corrected. In fact we asked Ms. Doshi whether she wanted to approach learned Single Judge in this connection. However there was no positive response from her. In our opinion, this stand taken by the appellant union makes a dent in its case.In view of the law laid down by the Supreme Court in the above judgments, it is not possible for any one to contest the proposition that a wrong concession made by a party or its advocate on a statutory provision cannot bind them. However, in our opinion, facts of this case are different. We are not concerned here with merely a concession made by a counsel. The appellant union took a stand that under Sectionthe Specified Authority can review its order and also make a reference and that the Specified Authority had in fact reviewed its order on the basis of judgment of this court in Cable Corporations case which held the field at that time. We have already noted that this legal stand of the appellant union is reflected in its arguments filed before the Tribunal and in itsfiled in this court. Thus the concession flows from the pleadings of the parties. The appellant union accepted the factual existence of a valid review order and thereafter sought to defend its stand on the basis of this courts judgment in Cable Corporations case. After the Supreme Court set aside this courts judgment in Cable Corporations case theis trying to contend that such statement was never made. In any case it is pertinent to note that in Commissioner of Endowments case (supra) the Supreme Court has observed that a party may resile from a concession of law but it cannot call in question the very fact of making the concession as recorded in the judgment. We may also mention that in Writ Petition No. 1794 of 2008 which is filed by the appellant union prior to the filing of this appeal, the appellant Union proceeded on the basis that there is a factual order of review. It only seeks to contend that the said order has been passed illegally. The conclusion is inevitable that the appellant union is adopting inconsistent stands and its conduct reflects on the credibility of its case.It is not possible to accept this argument. Undoubtedly the remedy of review or reference is a valuable remedy. But the legal position is clarified by the Supreme Court in Cable Corporations case (supra). The two remedies are alternative remedies. If review jurisdiction is exercised and review application is rejected then there can be no further order of reference. In this case there is no question of denial of remedy to the appellant union. The application of the appellant union has been considered by the Specified Authority and the Specified Authority has rejected it. The appellant union adopted the remedy available in law and the Specified Authority adjudicated the application. Once Specified Authority considers the application of the appellant union merely because the decision of the Specified Authority is against the appellant union it cannot contend that it was deprived of the valuable right of review. We have already concluded that the Specified Authority exercised its review jurisdiction and rejected the review application. The order of the Specified Authority cannot be interpreted in any other way. Any attempt made by us to interpret it differently would be doing violence to the law settled by the Supreme Court in Cable Corporations case (supra).We are not impressed by this submission. The Tribunal made its award pursuant to the Specified Authoritys order dated 24/4/03. Once that order is found to be illegal, the award must fall to the ground. This is a settled legal position which cannot be overlooked. If the award goes, the consequences must follow. The argument that the reference order is in consonance with this courts judgment in Cable Corporations case which held the field at that time and, therefore, the reference is legally valid is fallacious. The legal position has been clarified by the Supreme Court now and what preceded the reference order must be examined in the light of the Supreme Courts judgment in Cable Corporations case (supra).