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CASE NO.:

Appeal (civil) 5555 of 1999

PETITIONER:

M/S NATIONAL TEXTILE CORPORATION (APKKM) LIMITED.

Vs.

RESPONDENT:

SREE YELLAMMA COTTON, WOOLLEN AND SILK MILLS STAFF ASSOCIATION

DATE OF JUDGMENT: 18/01/2001

BENCH:

S.V.Patil, S.R.Babu

JUDGMENT:

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RAJENDRA BABU, J. :

The employees of the appellant-Corporation fall into

three categories and they are (i) technical persons and

Supervisors, (ii) ministerial staff and (iii) workmen. As

regards the second category of employees a settlement was

entered into on 3.9.1979 which was to be effective for a

period of five years from 1.10.78. The said settlement also

provided that the ministerial staff shall not make any claim

or demand for the revision of any of the terms and

conditions covered by the settlement or make any demand

involving additional financial burden on the mills subject

however to clause 5 of the settlement and a provision was

also made for dearness allowance which would be in force for

a period of three years from 1.10.1978. With regard to

third category of employees the appellants entered into two

settlements as a result of which workers agreed to work on

seven-day-a-week- working system from 16.11.1980 thereby the

weekly holiday stood changed and in addition certain

increases in emoluments have been provided to them. The

second category of employees-ministerial staff raised an

industrial dispute which was referred by the Government of

Karnataka on the following two questions :

(1) whether the appellant is justified in changing the

weekly holidays of the staff members with effect from

16.11.1980? (2) Are the employees in the second category

justified in demanding 4 per cent increase in emoluments and

payment of Rs. 52.20 per staff member per month at par with

the mill workers?

The Labour Court answered both the questions in the

affirmative and made an award that the increased emoluments

to the second category of workmen will become payable from

1.10.1983. The correctness of the said award was challenged

in a writ petition filed by the appellant. The learned

Single Judge of the High Court, while deciding the writ

petition held that the settlement dated 3.9.1979 which

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became effective from 1.10.78 having been acted upon and

during the subsistence of the settlement, the reference

could not have been made and, moreover, the parity claimed

in the emoluments to be paid to the workmen and the

ministerial staff forming separate categories cannot be

drawn and, therefore, enhancing the remuneration from

1.10.1983 is untenable and allowed the writ petition by

setting aside the award made by the Labour Court and

rejecting the reference made by the Government. On an

appeal, the Division Bench of the High Court reversed the

decision of the learned Single Judge and restored the award

made by the Labour Court. Hence this appeal.

The view of the learned Single Judge is commended for

acceptance by the learned counsel for the appellants.

Undoubtedly, the legal position is that during the

subsistence of a settlement it is not open to any of the

parties to raise a dispute. A settlement once entered into

between the parties shall be operative until the same is

terminated as provided in Section 19 of the Industrial

Disputes Act, 1947 [hereinafter referred to as the Act].

The object of such a provision is to ensure that once a

settlement is entered into then industrial peace prevails

according cordialities between the parties during the period

agreed upon. The same position should continue by extension

of the settlement by operation of law. There is an option

given to either party to terminate the settlement and such a

course having not been adopted in the present case the

dispute could not have been raised by the parties. But in

an appropriate case Government may make a reference under

the Act on the ground that since the time settlement was

entered into there has been material change in the

circumstances. In the present case, the Labour Court

noticed such a situation arising as a result of the second

settlement entered into with the workmen that is the third

category of employees. In the original settlement between

the parties there has been no provision of working the mills

all seven days in a week nor was any provision made in

regard higher emolument applicable to either class of

workmen. The Labour Court noticed that a gardner who had

been categorised as a member of the staff coming under

category two could get less emoluments than his helper who

comes under category three and, therefore, in those special

circumstances in view of the change in the working

conditions the Labour Court gave relief to the employees

coming under second category but from a date on the expiry

of the agreed settlement entered into by the parties,

namely, 1.10.1983. Section 19 of the Act limits the

variation of settlement but if there has been any material

change in the circumstances available in the establishment

of an employer certainly such a situation can not be ignored

altogether to state that settlement alone should be adhered

to whatever be the situation. If such a settlement cannot

be worked out in a congenial atmosphere between the workmen

and the employer it will be difficult to maintain industrial

peace and these aspects are to be borne in mind by the

Labour Court. We do not think that such considerations

would be altogether irrelevant in giving the relief as

sought for by the respondents and to deny the same on the

short ground of reference not being maintainable.

Secondly, on the question whether there should be

parity in payment between the employees working in the

establishment in different categories, ultimately what

decides the matter is a sense of fairness in providing

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different scales of pay. If, as stated earlier, a gardner

was to get less emoluments by treating him under category

two, his helper were to receive higher emoluments in view of

the second settlement entered into with category three to

which Helper belongs, the whole system smacks of

arbitrariness and unfair treatment of different categories

of employees. What has to be seen ultimately is whether the

emoluments that are paid to the second category of employees

become unfair in view of increase in the emoluments given to

other classes of employees. By bearing in mind the

increased work load and the nature of employment the Labour

Court took the view that similar increase should be there in

the emoluments. We do not think, such reasoning is

unjustifiable. Therefore, in the special features of this

case the learned Single Judge of the High Court ought not to

have interfered with the order made by the Labour Court.

Therefore, the Division Bench was justified in setting aside

the order made by the learned Single Judge for the reasons

stated by us. We find good reasons to maintain the award

made by the Labour Court in reversal of the decision of the

learned Single Judge in the writ petition.

For the aforesaid reasons, this appeal stands

dismissed. However, in the circumstances of the case there

shall be no order as to costs.