Case: Moon Mills Ltd Vs. Industrial Court Bombay (M.R. Meher) &amp; Ors

an adjudicator under the Act, such an agreement cannot therefore, be directed to be enforced against the will of the appellant even under S. 114(2) inasmuch as by doing so the State Government would be going beyond the powers conferred on it by that section. The impugned notification, therefore, must be held to be bad inasmuch as it goes beyond the powers conferred on the State Government under S. 114(2) and must therefore, be struck down. " In our opinion, the present case falls directly within the ratio of the decision of this Court in Prakash Cotton Mills case (1962) 2 SCR 105: (AIR 1961 SC 977 ), and it follows, therefore, that the award of Mr. Bhat, dated April 25, 1958 is illegal and ultra vires and the decision of the Labour Court dated August 4, 1959 and of the Industrial Court, dated October 24, 1959 must be quashed by grant of a writ of certiorari. 6. On behalf of the respondents Mr. B. Sen, however, pointed out that the conduct of the appellant does not entitle it to the grant of a writ, because it has been guilty of acquiescence or delay. It was pointed out that the award of Mr. Bhat was given on April 25, 1958 but an application to the High Court for grant of a writ was made long after on November 16, 1959. We do not think there is any substance in this argument, because the second respondents had made an application, dated August 19, 1958 to the Labour Court for enforcement of the award and the appellant had contested that application by a Written Statement, dated September 15, 1958. The Labour Court allowed the application on August 4, 1959 and the appellant had preferred an appeal to the Industrial Court on August 31, 1959. The decision of the Industrial Court was given on October 24, 1959 and after the appeal was dismissed the appellant moved the High Court for grant of a writ on November 16, 1959. Mr. B. Sen then put forward the argument that the appellant itself had acted on the bonus agreement and on October 14, 1957 had issued a notice informing its workers that "pursuant to the award of the Industrial Court in terms of the agreement, dated March l, 1956 reached between the Millowners Association, Bombay, and the Rashtriya Mill Mazdoor Sangh, regarding payment of bonus would be paid to them at 4.8 per cent of the total basic earning during 1956". On October 27, 1956 the appellant and the Secretary of the second respondents signed a joint statement in which it was stated as follows : "Since it has not yet been possible to complete bonus calculations for all these years, it is hereby agreed between the Rashtriya Mill Mazdoor Sangh, Bombay, and the Moon Mills Ltd, Bombay, that under the Bonus Agreement the Moon Mills should pay a bonus at the rate of 4.8 per cent for each of the years 1953, 1954 and 1955 as a tentative payment." It was, therefore, contended that the appellant itself had agreed with the second respondents to pay bonus for 1953, 1954, 1955 and 1956 according to the terms of the bonus agreement. It was also pointed out that the appellant had not pressed its objection with regard to jurisdiction before the Labour Court or the Industrial Court. But it appears that the decision of this Court in Prakash Cotton Mills case, (1962) 2 SCR 105: (AIR 1961 SC 977 ), was given on February 16, 1961 after the decision of K. K. Desai, J. on July 1, 1960 and before the decision of the Letters Patent Bench on February 6, 1962. In the circumstances of this case, we do not consider that there is such acquiescence on the part of the appellant as to disentitle it to a grant of a writ under Art. 226 of the Constitution.It is true that the issue of a writ of certiorari is largely a matter of sound discretion. It is also true that the writ will not be granted if there is such negligence or omission on the part of the applicant to assert his right as, taken in conjunction with the lapse of time and other circumstances, causes prejudice to the adverse party. The principle is to a great extent, though not identical with, similar to the exercise of discretion in the Court of Chancery.The principle has been clearly stated by Sir Barnes Peacock in Lindsay Petroleum Co. v. Prosper Armstrong Hurd, Abram Farewell, and John Kemp, (1874) 5 PC 221 at p. 239, as follows:- "Now the doctrine of laches in Courts of Equity is not an arbitrary or a technical doctrine. Where it would be practically unjust to give a remedy, either because the party has, by his conduct, done that which might fairly be regarded as equivalent to a waiver of it, or where by his conduct and neglect he has, though perhaps not waiving that remedy, yet put the other party in a situation in which it would not be reasonable to place him if the remedy were afterwards to be asserted, in either of these cases, lapse of time and delay are most material. But in every case, if an argument against relief, which otherwise would be just, is founded upon mere delay, that delay of course not amounting to a bar by any statute of limitations, the validity of that defence must be tried upon principles substantially equitable. Two circumstances, always important in such cases, are, the length of the delay and the nature of the acts done during the interval, which might affect either party and cause a balance of justice or injustice in taking the one course or the other, so far as related to the remedy." In the present case, we are of opinion that there is no such negligence or laches or acquiescence on the part of the appellant as may disentitle it to the grant of a writ.

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

Explanation:
1[ds]We are unable to accept the argument of the respondents as correct. It was held by the majority judgment of this Court- in Prakash Cotton Mills case, (1962) 1 SCR 105  : (AIR 1961 SC 977  ), that the notification, dated July 31, 1956 was beyond the powers of the State Government under S. 114(2) of the Act, because there are three limitations on the State Governments power enacted under that sub-section: (1)It is limited by the subject-matter of the agreement or settlement, submission or award sought to be extended, (2) it has to be in conformity with the Industrial Law laid down by the Full Bench of the Industrial Court and also by any decision of this Court, and (3) the State Governments power to make a direction under that section is co-terminus with the power of an adjudicator and the State cannot do what an adjudicator cannot do under the Act. At p. 112 of the Report, (SCR): (at p. 979 of AIR), Wanchoo, J., speaking for the Court stated as follows:"The contention on behalf of the appellant is that it would not be open to an Industrial Court to grant bonus when profit was not adequate to meet all prior charges or where there was an actual loss and, therefore, when the impugned notification made it possible for grant of bonus even in these cases (for prima facie the appellant had made losses upto 1955), it directed something which even an Industrial Court could not do. In consequence, it is urged that the notification inasmuch as it makes this possible is beyond the powers conferred on the State Government under S. 114(2) because it allows something to be done which even an Industrial Court could not allow. Reliance in this connection is placed on the decision of this Court in New Manekchowk Spinning Co. Ltd. v. Textile Labour Association, (1961) 3 SCR 1  : (AIR 1961 SC 867  ). In that case this Court was considering a similar agreement relating to Ahmedabad. The Industrial Court had imposed that agreement after its expiry for one year on the mills in spite of their contention that they were not bound to pay any bonus for the years in dispute in view of the law laid down by this Court in The Associated Cement Companies Ltd. v. The Workmen, 1959 SCR 925  : (AIR 1959 SC 967  ). After examining the terms of the agreement then in dispute this Court came to the conclusion that in view of the law laid down in the Associated Cement Companies, case, the Industrial Court had no jurisdiction to impose that agreement on the mills. It further held that an agreement of that kind could only continue by consent of parties and could not be enforced by industrial adjudication against the will of any of the parties. The agreement in the present case directed to be enforced by the impugned notification is similar in terms and as held in The New Maneckchowks case, it could not be enforced by industrial adjudication against the will of any of the parties. The power of the State Government under Section 114(2) being co-terminus with the power of an adjudicator under the Act, such an agreement cannot therefore, be directed to be enforced against the will of the appellant even under S. 114(2) inasmuch as by doing so the State Government would be going beyond the powers conferred on it by that section. The impugned notification, therefore, must be held to be bad inasmuch as it goes beyond the powers conferred on the State Government under S. 114(2) and must therefore, be struck down. "In our opinion, the present case falls directly within the ratio of the decision of this Court in Prakash Cotton Mills case (1962) 2 SCR 105: (AIR 1961 SC 977  ), and it follows, therefore, that the award of Mr. Bhat, dated April 25, 1958 is illegal and ultra vires and the decision of the Labour Court dated August 4, 1959 and of the Industrial Court, dated October 24, 1959 must be quashed by grant of a writ of certiorariWe do not think there is any substance in this argument, because the second respondents had made an application, dated August 19, 1958 to the Labour Court for enforcement of the award and the appellant had contested that application by a Written Statement, dated September 15, 1958. The Labour Court allowed the application on August 4, 1959 and the appellant had preferred an appeal to the Industrial Court on August 31, 1959. The decision of the Industrial Court was given on October 24, 1959 and after the appeal was dismissed the appellant moved the High Court for grant of a writ on November 16, 1959But it appears that the decision of this Court in Prakash Cotton Mills case, (1962) 2 SCR 105: (AIR 1961 SC 977  ), was given on February 16, 1961 after the decision of K. K. Desai, J. on July 1, 1960 and before the decision of the Letters Patent Bench on February 6, 1962. In the circumstances of this case, we do not consider that there is such acquiescence on the part of the appellant as to disentitle it to a grant of a writ under Art. 226 of the Constitution.It is true that the issue of a writ of certiorari is largely a matter of sound discretion. It is also true that the writ will not be granted if there is such negligence or omission on the part of the applicant to assert his right as, taken in conjunction with the lapse of time and other circumstances, causes prejudice to the adverse partyThe principle has been clearly stated by Sir Barnes Peacock in Lindsay Petroleum Co. v. Prosper Armstrong Hurd, Abram Farewell, and John Kemp, (1874) 5 PC 221 at p. 239, as follows:"Now the doctrine of laches in Courts of Equity is not an arbitrary or a technical doctrine. Where it would be practically unjust to give a remedy, either because the party has, by his conduct, done that which might fairly be regarded as equivalent to a waiver of it, or where by his conduct and neglect he has, though perhaps not waiving that remedy, yet put the other party in a situation in which it would not be reasonable to place him if the remedy were afterwards to be asserted, in either of these cases, lapse of time and delay are most material. But in every case, if an argument against relief, which otherwise would be just, is founded upon mere delay, that delay of course not amounting to a bar by any statute of limitations, the validity of that defence must be tried upon principles substantially equitable. Two circumstances, always important in such cases, are, the length of the delay and the nature of the acts done during the interval, which might affect either party and cause a balance of justice or injustice in taking the one course or the other, so far as related to the remedy."In the present case, we are of opinion that there is no such negligence or laches or acquiescence on the part of the appellant as may disentitle it to the grant of a writ.