Case: I.T.C. Ltd. Workers Welfare Association and Anr Vs. The Management of I.T.C. Ltd. and Ors

3. The 1st appellant sought leave of this Court of file the SLP as it was not a party in the Writ Petition out of which this SLP arises. Leave has been granted by us. It may also be noticed that by an order of this Court dated 31.08.2001 on IA of 2001 the 2nd appellant herein, who was respondent No. 3 in SLP, has been transposed as petitioner in the SLP.4. At the outset, it may be stated that the present SLP was filed with a delay of 460 days. The delay in filing the SLP is sought to be explained in a very casual manner, the only ground stated being "paucity of funds" which on the face of it is as vague as it could be. In the normal course, we should have dismissed the I.A. for condonation of delay and rejected the SLP summarily. However, as arguments have been advanced at length on the merits and as the grievance of retired employees is being projected, we do not consider it appropriate to dismiss to SLP on the ground of delay. Hence, leave has been granted and appeal decided on merits.5. The following dispute between the Management of ITC Ltd. Basudevpur, Munger and their workmen represented by Munger Tobacco Manufacturing Union which is a recognised union was referred for adjudication by the Industrialto enforce Platinum Jubilee Scheme Pension Plan for the workers who retired from service on or after 24.8.1986 and to enforce other pension scheme for the workers retired before the 24.8.1996 and to give two types of benefits to both types of workers by the Management of I.T.C. Ltd., Basudeopur Munger is legal and justified? If not, whether the workers who retired before 24.8.1986 from I.T.C. Ltd. Basudeopur Munger are also entitled for the benefits under Platinum Jubilee Pensionlearned Presiding Officer answered the reference in favour of the Management and against the Union, having held that the workmen who retired before 24.8.1986 were not entitled to the benefits under the Platinum Jubilee Pension Scheme. By that scheme, the workmen who retired on or after the datewere made eligible to get life pension. It was the contention of thebefore the Tribunal and it is also the contention of the appellants that the benefits should be extended to all those workmen who retired during and after 1977 when the pension scheme was first introduced in this industrial establishment.6. To have a proper background of the dispute, it is necessary to refer briefly to the pension scheme prevalent prior to the introduction of the Platinum Jubilee Pension Scheme. A settlement entered into on 27.6.1997 paved the way for the introduction of pension scheme for the first time. It applied to the permanent workmen on the rolls of the company who retired on or after 1.6.1977. Under that scheme, the pension was payable for a period of 10 years. By a subsequent settlement dated 22.4.1982, though the period of drawal of pension remained the same, the formula was revised and the maximum pension payable was enhanced to Rs. 225/per month. This benefit under the settlement dated 22.4.1982 governed the workmen who were on the Companys pay roll on the date of signing of the settlement. On the eve of commemoration of platinum jubilee of ITC Ltd., the Management decided to introduce a scheme known as Platinum Jubilee Pension Scheme. Under this scheme, eligible workmen will get the pensionary benefits till their life time and on their demise, part of the benefits go the their nominees or legal heirs. In order to implement the pension scheme, a fund named "Platinum Jubilee Fund" was created under a trust deed dated 27.5.1987. As a follow up thereto, ITC Platinum Jubilee Pension Fund scheme Rules were framed in the year 1988. While so, pursuant to discussions and negotiations held in the course of conciliation proceedings, there was a settlement under Section 12(3) of Industrial Disputes Act on 10.4.1988. As it was agreed that the Platinum Jubilee Pension Scheme should be made part of the service conditions of employees, the following provisions were incorporated in the settlement datedSCHEMEIn supersession of clause 14 Part 1 read with Annexure VII of Memorandum of Settlement dated 28.4.82, the following Pension Scheme shall applyThe company has by a Deed of Trust dated 27.5.87 setup a Trust Fund entitled the ITC Platinum Jubilee Pension Fund for payment of pension to its workmen. With effect from the date of signing of this Memorandum of Settlement, all workmen on the rolls of the company as at 24th August, 1986 and thereafter will be eligible to become members of the aforesaid ITC Platinum Jubilee Pension Fund and will be eligible to receive benefits in accordance with the aforesaid Trust Deed and the ITC Platinum Jubilee Pension Fund rules. A copy of the said Trust Deed and Rules is attached herewith as Annexure XII.(ii) With effect from 1.4.88, the ITC Workmens Pension Fund Scheme as contained in clause 14, Part 1 and Annexure VII of the Memorandum of Settlement dated 28.4.82 will cease to be applicable to workmen on the rolls of the company as at 24.8.86 and therefore. It is expressly agreed and understood that such workmen will be governed only by the ITC Platinum Jubilee Pension Fund Deed and Rules.(iii) It is clarified that workmen who were on the rolls of the company prior to 24.8.86 and who are in receipt of pension under the ITC workmens Pension Scheme as contained in clause 14, Part 1 and Annexure VII of the Settlement dated 28.4.82 will continue to be governed by the rules of the ITC Workmens Pension Scheme. The ITC Platinum Jubilee Pension Fund Deed and Rules will not be applicable to them."

Court's reasoning:
14. In answering the reference the industrial adjudicator has to keep in the forefront of his mind the settlement reached under Section 12(3) of the Industrial Disputes Act. Once it is found that the terms of the settlement operate in respect of the dispute raised before it, it is not open to the Industrial Tribunal to ignore the settlement or even belittle its effect by applying its mind independent of the settlement unless the settlement is found to be contrary to the mandatory provisions of the Act or unless it is found that there isto the norms by which the settlement could be subjected to limited judicial scrutiny. This is infact the approach of the Tribunal in the instant case. The High Court which examined the issue from a different angle as well was, in our view, justified in affirming the award of the Tribunal.Admittedly, the settlement arrived at in the instant case was in the course of conciliation proceedings and therefore it carries a presumption that it is just and fair. It becomes binding on all the parties to the dispute as well as the other workmen in the establishment to which the disputed relates and all other persons who may be subsequently employed in that establishment. An individual employee cannot seek to wriggle out of the settlement merely because it does not suit him.Having noted that the only objectionable feature of the settlement as found by the Tribunal was reduction of dearness allowance from cent per to 85 per cent, it was held that, that part of the settlement cannot be held to be invalid or inoperative. This proposition laid down in Herbertsons case was reiterated in K.C.P. Ltd. case (supra), approvingly citing the said decision. The passages in Herbertsons case were quoted in extenso and approved by thebench in TELCO case (supra) as well.22. What follows from a conspectus of these decisions is that a settlement which is a product of collective bargaining is entitled to due weight and consideration, more so when a settlement is arrived at in the course of conciliation proceedings. The settlement can only be ignored in exceptional circumstances viz. if it is demonstrably unjust, unfair or the result of mala fides such as corrupt motives on the part of those who were instrumental in effecting the settlement. The apart, the settlement has to be judged as a whole, taking an overall view. The various terms and clauses of settlement cannot be examined in piecemeal and in vacuum.23. Viewed in the light of these principles, it cannot be said that the settlement in the present case which is otherwise valid and just suffers from any legal infirmity merely for the reasons that one of the clauses in the settlement extends the benefits of life pension scheme only of the employees retiring after a particular date i.e. 24.8.1986. Exclusion of workmen retiring before that date is no ground to characterise the settlement an unjust or unfair. Of course, the allegations of mala fides such as corrupt motives have not been levelled against anyone and that aspect becomes irrelevantpresent case is one where Article 14 cannot be applied as the respondent is not State or other Authority. On this, there is practically no dispute. If so, the approach should be as we indicated earlier; that is to say, whether the settlement can be said to be unjust, unfair or vitiated by mala fides. No mala fides is imputed to anyone. What remains to be consideration is whether it is fair and just, viewed from a broader angle and taking a holistic view of the matter. It is true that certain considerations germane to Article 14 may also be germane while deciding the issue whether the settlement is just and fair. But, it does not follow that the doctrine of classification and the principles associated with it should be projected wholesale into the process of consideration of justness and fairness of the settlement. There may be some overlapping and there may be some facets which apply in common to determine the crucial issue whether the settlement on the whole is just and fair, but that is not to say that the settlement is liable to be tested on the touchstone of Article 14, more so when it has no application in the instant case. Keeping this distinction in mind and considering the grounds of attack on the particular clause of settlement, we are unable to hold that it is vulnerable to challenge on anygrounds. The facts on record do not establish that the settlement which was reached was palpably unjust or unfair from the point of the entire body of workmen. The preponderence of circumstances and the material on record do not in our view displace the presumption attached to the settlement arrived at in the course ofour view, conferment of such additional benefit to workmen who retired after the date of platinum jubilee celebration and before the date of culmination of settlement, far from making it unjust or irrational, tantamounts to extending benefit to some more workmen who would not have got it otherwise, if the decision was implemented prospectively. Apparently, such decision was taken to arrive at an amicable settlement and to comply with the demands of the workmen to the extent feasible and practicable. The argument that either all the retired employees should be given the benefit or none at all cannot cut ice if the principles of collective bargaining and justness of the settlement viewed as a whole is kept in view. There is nothing which is palpably unjust or irrational in giving the benefit only to those who retired during and after the platinum jubilee year. Though there was some dispute as to the correctness of the date on which the platinum jubilee falls, on material has been placed before us excepting the date of incorporation of the Company to establish the version of the appellants in this regard. Picking up that date by going a little backwards from the date of settlement cannot be regarded as a whimsical or arbitrary step, more so when it was down with the consent of large majority of workmen. The Tribunal while adjudicating the dispute and the High Court while exercising its jurisdiction under Art. 226/227 should be circumspect and cautious in disturbing the terms of settlement founded on collective bargaining and conciliation. The adjudicator or industrial dispute could not have directed the benefit to be extended to all the retired employees by substituting its own views to those reflected in the settlement, on an application of the usual principles governing industrial adjudication.26. Another factor to be taken into account is that the recognised union of workmen which espoused the cause of the retired employees and contested the issue before the Industrial Tribunal did not pursue the matter further obviously because the felt that in the larger interests of maintaining industrial harmony and peace, the matter should be left off at that state. A member of that recognised union had taken up the issue before the High Court.