Case: The Textile Labour Association Ahmedabad Vs. The Labour Appellate Tribunal of India &amp; Others

1. There was a dispute between the Textile workers in Ahmedabad and the Millowners Association and in regard to those disputes and future disputes there was a submission in arbitration on53 respondent 2 company gave a notice to its workers to close down the second shift from3 the petitioners, who are the Textile Labour Association, wrote to respondent 2 company pointing out that the action that they sought to take was covered by the general submission made onand before closing down this shift they should have the matter adjudicated upon by the arbitrators. Respondent 2 company did not accept this contention of the petitioners and the second shift was closed down fromthat time an industrial dispute was pending before the Labour Appellate Tribunal and the petitioners made a complaint under S. 23, Industrial Disputes (Appellate Tribunal) Act, 1950, that respondent 2 company had dismissed its employees without the necessary permission of the Labour Appellate Tribunal under S. 22.This dispute between the petitioners and respondent 2 company was referred to arbitration onand the submission paper signed by the General Secretary of the Textile Labour Association and the Manager of respondent 2 company stated that the parties shall refer within a week the dispute involved in the present application to be arbitration of Sheth Shri Sakarlal Balabhai and Shri S.R. Vasavda under the terms of the arbitration agreement between the Millowners Association and the Textile Labour Association of Ahmedabad, and this was the reference to the general submission made onsubmission to arbitration was registered under S. 66, Bombay Industrial Relations Act, 1946, onand the dispute which was referred is the dispute regarding the closure of the second and third shifts to the arbitration of Vasadva and Sakarlal Balabhai. The arbitrators differed and the matter was referred to Mr. Divatia who acted as the Umpire, and Mr. Divatia gave his award onRespondent 2 company then applied to the Labour Court to set aside the award on the ground of legal misconduct on the part of Mr. Divatia.The Labour Court held that the application was not maintainable and dismissed the application. Respondent 2 company appealed to the Labour Appellate Tribunal. The Labour Appellate Tribunal took the view that the application was well founded, set aside the order of the Labour Court and remanded the matter to the Labour to dispose of the application of respondent 2 company on merits. The petitioners have now come before us on this petition.

Court's reasoning:
It is true that if we consider any provision of the Arbitration Act it would be necessary to inquire whether that particular provision is applicable looking to the scheme of the Bombay Industrial Relations Act 1946.If any provision is inconsistent with the scheme of the Bombay Industrial Relations Act, 1946, then the provision of the Arbitration Act to that extent would not be applicable. One salient fact which becomes immediately apparent is that Chapter XI does not provide for any machinery for setting aside an award. If an arbitrator is guilty of misconduct or if the award is otherwise invalid, there is nothing in Chapter XI which confers any right upon the aggrieved party to challenge the award.Mr. Buch does not suggest indeedhe cannot suggestthat an aggrieved party should be without a remedy, but his contention is that the remedy is to be found not within the four corners of the Arbitration Act, 1940, but outside theto the Arbitration Act, 1940, S. 30 lays down the grounds for setting aside an award and the award of Mr. Divatia has been challenged by respondent 2 company on one of the grounds mentioned in S. 30. Whether they succeed in making good that ground or not is another matter with which we are not concerned on this petition.Therefore, as far as S. 30 is concerned there is no reason why the provisions of S. 30 should not be made applicable to arbitration under Chapter XI, Bombay Industrial Relations Act, 1946.Buch may be right that when an award is made in an arbitration under Chapter XI, Bombay Industrial Relations Act, the award has to be filed not as provided by S. 14, Arbitration Act but as provided by S. 74, Bombay Industrial Relations Act.But that does not present any insurmountable difficulty with regard to an application to set aside anis perfectly true that under the Arbitration Act an award has got to be filed under S. 14 and it is only that Court in which the award has been filed or where the award may be filed that has jurisdiction to deal with the question of the validity of an award under S. 30. But S. 68 and that is the whole purpose of S. 68substitutes a Labour Court or an Industrial Court for the Civil Court which exercises jurisdiction with regard to awards under S. 31.The powers which are exercisable by a Civil Court are exercisable by a Labour Court and the Industrial Court, and it is difficult to understand why a Labour Court or an industrial Court cannot deal with the validity of an award in the same way as a Civil Court can under the provisions of the Arbitration Act. Obviously, the provisions of the Arbitration Act must be applied to the Bombay Industrial Relations Act mutatisis difficult to accept the contention that the Bombay Industrial Relations Act should have deprived an aggrieved party of the summary and more expeditious remedy of challenging an award by the procedure laid down in the Arbitration Act and should have driven the party to a Civil Court to have his right adjudicated upon. The whole object of Labour Legislation is to get quick decisions with regard to industrial disputes and it cannot be seriously suggested that Labour Legislature contemplated an award being challenged by the rather leisurely, expensive and slow method of a civil suit being filed with regard to the validity of theis not a case where the State refers the dispute to arbitration and the statutory provision itself constitutes an arbitration agreement. But even assuming that S. 46 applied, Mr. Buch has failed to satisfy us that there is anything in the provisions of the Arbitration Act with regard to the setting aside of an award which is inconsistent with the provisions contained in Chapter XI, Bombay Industrial Relationsis erroneous to suggest that the Labour Court was exercising its jurisdiction under S. 78 in dealing with the application made by respondent 2 company. The Labour Court was dealing with an application to set aside an award and the Labour Court would have no jurisdiction to entertain such an application to set aside an award and the Labour Court would have no jurisdiction to entertain such an application under S. 78 at all. Its jurisdiction springs from the provisions of S. 68.It is that section which confers jurisdiction upon the Labour Court to exercise the powers exercisable by a Civil Court under the Arbitration Act and the question that we have to consider is, when a Labour Court exercises the power of a Civil Court under the Arbitration Act under S. 68, whether an appeal lies and if so to which Court. The reason why respondent 2 company went to the Labour Court and not to the Industrial Court on this petition was that the subject matter of the reference to arbitration fell within the jurisdiction of the Labour Court under S. 78.But even though the subject matter of the reference might have fallen within the jurisdiction of the Labour Court under S. 78, the Labour Court was not dealing with that subject matter but was dealing with the question of the validity of the award under S. 68, and as far as the Bombay Industrial Relations Act is concerned there is no provision with regard to appeal from a decision of the Labour Court exercising its powers under S. 68.For that purpose we have really to turn to the Industrial Disputes (Appellate Tribunal) Act and under S. 2(c) an Industrial Tribunal is defined as in relation to other cases, where no appeal lies under any law referred to in(ii), any Court, board or other authority set up in any State under such law, and it is not disputed that under this definition the Labour Court under S. 68 would be an industrial tribunal and if the Industrial Court would be an industrial tribunal under S. 2 then an appeal is provided against the decision of the Industrial Court under S. 7 to the Appellate Tribunal and it is under this provision that the appeal was entertained by the Labour Appellate Tribunal.In our opinion, the appeal was rightly entertained and the Labour Appellate Tribunal had jurisdiction to entertain the appeal.