The role of the employer at stage of reference is only administrative and cannot quasi-judicial or judicial function: High Court of Delhi

16 IN THE HIGH COURT OF DELHI AT NEW DELHI Date of decision: 23rd July 2021 W.P.(C) 8235 2020 & CM APPL. 26694 2020 Through: Mr. Anuj Aggarwal Advocate. ..... Petitioner JUSTICE PRATHIBA M. SINGH GOVERNMENT OF INDIA & ORS. Through: Ms. Arti Bansal Advocate. ..... Respondents Prathiba M. Singh J.This hearing has been done through video conferencing. The Petitioner in the present petition has challenged the impugned order dated 10th June 2019 passed by the Section Officer Ministry of Labour Government of India by which it has been held that an industrial dispute of a contractual employee working with the Ministry of Labour is not covered under the Industrial Disputes Act 1947as the Ministry of Labour executing a sovereign function for the Union of India is not an “industry” under the ID Act. The reference moved by the Petitioner under Section 10 of the ID Act has been rejected by the Respondent in the following terms: “Sir Conciliation Report No. ALC III 8(95)17 I am directed to refer to the Failure of W.P.(C) 8235 2020 01 03 2018 from the ALC(Delhi) received in this Ministry on 31 01 2018 on the above mentioned subject and to say that prima facie this Ministry does not consider this dispute fit for adjudication for the following reasons: “Industrial dispute of a contractual employee working in the Ministry of Labour is not converted under ID Act as Ministry of Labour executing sovereign function for the Union of India is not an industry as defined under the ID Act 1947.” The brief background of the petition is that she was working as a sweeper peon etc. on daily wage basis from 12th May 2007 up to August 2014 in the Ministry of Labour and Employment Govt. of India located at Shram Sakti Bhawan Rafi Marg Delhi. She claimed to be performing her duties continuously and was an unskilled labourer in the Group D category. She claimed that her position was thereafter designated as MTS i.e. Multi Tasking Staff after implementation of the 6th Pay Commission and was merged with the Group C category. She claimed that the salary etc. were paid to her directly from the Social Security Division of the management. According to the Petitioner her services were terminated on 31st August 2014. Thereafter she filed a statement of claim before the Deputy Labour Commissionerfor being referred to the labour court under Section 10 of the ID Act. The prayer in the said statement of claim was for reinstatement with full back wages and continuity of service with consequential benefits. In the written statement filed before the Labour Commissioner the Ministry took a possession that it is executing a sovereign function with the Union of India and it does not constitute an “industry” under the ID Act. The conciliation proceedings also resulted in a failure and thereafter the impugned order came to passed on 10th June 2019. W.P.(C) 8235 2020 5. Mr. Anuj Aggarwal ld. Counsel appearing for the Petitioner submits that the issue at the time of reference under Section 10 of the ID Act is purely administrative. He submits that the legal question as to whether the Ministry of Labour would constitute an “industry” or not is not an issue which is to be determined at the stage of reference by the said Ministry itself. He submits that this is an issue which would have to be adjudicated upon on merits by the labour court. He thus relies upon the judgment of the Delhi High Court in All India and General Mazdoor Union v. GNCTD 106 2003) DLT 208 to urge that the Ministry cannot by itself decide on merits on question of reference under section 10 of ID Act and not refer the claim to a labour court by holding that the Ministry itself is not an “industry”. This according to him would be completely contrary to law as a determination of an administrative authority cannot result in the rejection of a claim. If the said issue as to whether the Ministry of Labour is an “industry” or not has to be considered it could have only been considered by the appropriate labour court and not by the Government at the time of making a reference to the labour court under section 10 of the ID Act. On the other hand Ms. Bansal ld. Counsel submits that as per the definition of an “industry” under section 2(j) of the ID Act the Ministry itself does not indulge in any manufacturing activity and hence it could not qualify to be an “industry” under the said Act. She accordingly defends the rejection of the reference by the ministry. Heard ld. counsels for the parties and perused the record. This Court has considered the definition of an “industry” under Section 2(j) of the ID Act and has also considered section 10 of the ID Act. W.P.(C) 8235 2020 A perusal of the said definition of “industry” under section 2(j) of the ID Act shows that the definition includes any kind of trade undertaking manufacture or industrial occupation. The role of the Ministry i.e. the employer at the stage of a reference under section 10 of the ID Act is merely refer the dispute to the concerned Court. However the rejection of this reference due to the reason given above is in effect an adjudication which cannot be permissible. Hence the determination as to whether the ministry is an industry or not is a legal question which would have to be decided by a judicial authority. This Court has perused the judgment in All India and General Mazdoor Union referred to by the Petitioner wherein it has been clearly held that the role of the employer at the stage of reference is only administrative and the referring Authority cannot exercise a quasi judicial or a judicial function. The relevant portion of the said judgment is set out below: 4. In my view the above order declining the reference for the aforesaid reasons is not sustainable because by the said order the Secretaryhas proceeded to adjudicate the plea as to whether the circuit House can be treated as an industry as per Section 2(j) of the Act. In my view the aforesaid finding adjudicating the dispute on merits between the parties can only be done by an adjudication under the Industrial Disputes Act and not at the stage of making a reference by the jurisdiction. The Labour Secretary has thus delved into a jurisdiction not vested with him in law. The plea whether the activities of Punjab Bhawan fall within the definition of Industry under S.2(j) of the Act is a plea which can only be raised and adjudicated in a Labour Court Industrial Tribunal. Secretary W.P.(C) 8235 2020 5. In Telco Convoy Drivers Mazdoor Sangh and MANU SC 0605 1989 : IILLJ 558 SC the Hon ble Supreme Court has held a follows: Though in considering the question of making a reference under Section 10(1) the government is entitled to form an opinion as to whether an industrial dispute "exists or is apprehended" but it is not entitled to adjudicate the dispute itself on merits. While exercising power under Section 10(1) of the Act the function of the appropriate government is an administrative function and not judicial or quasi judicial this administrative government cannot delve into the merits of the dispute and take upon itself the determination of the lis which would certainly be in excess of the power conferred on it by Section 10 of the Act." 6. The impugned order adjudicating the question of whether Punjab Bhawan activities were Industry thus clearly runs contrary to the position of law laid down in the aforesaid judgment which view has also been reiterated in Sharad Kumar Vs . Govt. of NCT of Deihi Ors. MANU SC 0313 2002 :8235 2020 8. In the aforesaid judgment in Telco Convoy Drivers Mazdoor Sangh and another Vs. State of Bihar and othersthe Hon ble Supreme Court also held as follows: In several instances this Court had to direct the government to make a reference under Section 10(1) when the government had declined to make such a reference and this Court was of the view that such a reference should have been made. See Sankari Cement Alai Thozhilalar Munnetra Sangam V. Government of Tamil Nadu Ram Avtar Sharma V. State of Haryana MP. Irrigation Karamchari Sangh V. State of M.P. Nirmal Singh V. State of Punjab." 10. Moreover the defence taken in the written statement that the function is sovereign in nature is also quite puzzling inasmuch as sovereign function cannot be stretched to employment of a sweeper or a peon in the Shram Sakti Bhawan where the Ministry of Labour is located. 11. Therefore the impugned order which upholds the defence of the Ministry that it is executing a sovereign function and hence the dispute need not be referred to a labour court is completely untenable. The same is accordingly set aside. 12. Accordingly the Secretary Ministry of Labour and Employment Government of India is directed to make a reference of the disputes raised by the Petitioner to the concerned labour court within a period of four weeks from today. 13. The petition is allowed in the above terms. It is made clear that the observations made in this order would not bind the labour court in any manner which would adjudicate the claim of the Petitioner and the defence taken if any on merits in accordance with law. W.P.(C) 8235 2020 14. The digitally signed copy of this order duly uploaded on the official website of the Delhi High Court www.delhihighcourt.nic.in shall be treated as the certified copy of the order for the purpose of ensuring compliance. No physical copy of orders shall be insisted by any authority entity or litigant. PRATHIBA M. SINGH JUDGE JULY 23 2021 W.P.(C) 8235 2020 

Summary: An employer cannot function in a judicial or a quasi-judicial function with respect to the regulation of its employees irrespective of whether the employer can be classified as an industry or not. This was held in the judgement passed by a single member bench of the High Court of Delhi consisting of Justice Prathiba M. Singh in the case of Sapna v The Government of India [W.P. (C) 8235/2020 &amp; CM Appl. 26694/2020] pronounced on 23rd July 2021. The petitioner, Sapna was working as a sweeper and a peon on daily wage basis for the Ministry of Labour and Employment, Government of India in Rafi Marg, Delhi since 12th May 2007. She was initially performing her duties continuously as an unskilled labourer in the Group-D category. However after the implementation of the 6th Pay Commission, she was classified as Multi-tasking staff and merged with the Group-C category.  On 31st August 2014, the petitioner’s services were terminated after which she filed a statement of claim before the Deputy Labour Commissioner to be referred to the labour court under Section 10 of the Industrial Disputes Act. The petitioner requested the court that she be reinstated  with the back wages and continuity of services. However the Ministry of Labour and Employment submitted that they were executing a sovereign function with the Union of India and could not be classifies as an Industry under the Industrial Disputes Act. The petitioner’s counsel cited the case of All India General Mazdoor Union v GNCTD [106 (2003) DLT 208] where the High Court of Delhi held that an administrative authority does not have the power to reject a claim  and that can only be done by the labour court under Section 10 of the Industrial Disputes Act. The court noted that it was irrelevant whether the Ministry of Labour or Employment was an industry or not as it was not a legal question related to the immediate case at hand. It was further held that the defence that Ministry was of sovereign nature could not be accepted since this sovereign function can anyhow not be stretched to the extent of employment of a sweeper or a peon.