Page 1 Reportable

IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL No. 1389 OF 2015

(Arising out of SLP(C) No.33509/2011)

Oshiar Prasad and Others Appellant(s)

VERSUS

The Employers in relation to

Management of Sudamdih

Coal Washery of M/s BCCL,

Dhanbad, Jharkhand Respondent(s)

J U D G M E N T

Abhay Manohar Sapre, J.

1.Leave granted.

2.This civil appeal is filed by the unsuccessful

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Page 2 writ petitioners against the judgment and order

dated 17.06.2011 passed by the High Court of

Jharkhand at Ranchi in L.P.A. No. 447 of 2009

which arises out of the order dated 03.09.2009

passed by the learned single Judge of the High

Court in C.W.J.C. No. 616 of 1999(R).

3.By impugned judgment, the Division Bench

dismissed the appellants’ intra court appeal and

upheld the order of the writ court, which had

dismissed the appellants’ writ petition and in

consequence upheld the award dated 21.12.1998

passed by the Labour Court in Reference Case No.

75 of 1995.

4.In order to appreciate the controversy

involved in this appeal, it is necessary to set out

the facts in detail.

5.The respondent - M/s Bharat Coking Coal Ltd

(hereinafter referred to as “the BCCL”) is a

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Page 3 Government of India undertaking. It is engaged in

the business of manufacture and sale of various

kinds of coal. It has a colliery at Dhanbad,

Jharkhand known as "Sudamdih Coal Washery”.

6.On 24.07.1974, the BCCL invited tenders for

construction of Washery on Turnkey basis for

running the colliery. The contract was awarded to

one Company - M/s MC Nelly, Bharat Engineering

Company Ltd. (hereinafter referred to as “the

Contractor"). An agreement was accordingly

executed between the BCCL and the Contractor on

29.01.1976. Since the execution of the work was

to be done on turnkey basis, the Contractor was

required to do every thing to make the Washery

operational. The work included the complete

design of the Washery, supply of materials

required for construction of plant, building,

installation of machinery, all kinds of construction

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Page 4 of the structures of Washery etc.

7.Pursuant to the contract, the Contractor

started the work in 1977 by employing several

skilled and unskilled workers and completed the

same by December 1979. After completion of the

work, the Contractor terminated the employment

of all the workers and offered them retrenchment

compensation as per the provisions of Section 25

of Industrial Disputes Act, 1947 (in short “the Act”)

except 39 skilled workers, who were retained to

look after the maintenance work of Washery after

it was made operationalized. These 39 workers

continued to work. After retaining their services

for about one year, the Management terminated

the services of these 39 employees in January,

1981. These 39 employees raised a dispute

demanding their absorption and continuation in

service with the BCCL. Since their demands were

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Page 5 not accepted, a reference was made under Section

10 of the Act to Industrial Tribunal No. 3 Dhanbad

vide Reference Case No. 58 of 1981 to answer the

following question:

“Whether the management of Sudamdih

Coal Washery of M/s Bharat Coking Coal

Ltd., P.O. Sudamdih, Dist. Dhanbad are

justified in not absorbing Sarvashri

Gorakh Sharma and 38 others as their

regular employees? If not, to what relief

are the said workmen entitled?”

8.The Industrial Tribunal by its award dated

03.03.1983 answered the reference in workers’

favour and directed that 39 workers be absorbed

by the BCCL in their employment as their regular

employees and they be given all such

consequential benefits to which they were entitled

to claim due to their regularization in the services

of BCCL. The BCCL did not challenge the award

and implemented the directions by absorbing and

regularizing these 39 workers in their

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Page 6 employment.

9.It may be mentioned that five workers

(including the appellants herein), who claimed to

be working in the same project, filed Title Suit No.

51/1980 against the BCCL in the Court of Munsif

2

nd

Dhanbad under Order I Rule 11 of the Code of

Civil Procedure, 1908 for declaration that they are

entitled to continue in their services under the

BCCL and prayed that their services be absorbed

and regularized in the services of BCCL with all

consequential benefits. They also prayed for an

injunction restraining the BCCL from terminating

their services pending civil suit.

10.The Trial Court, however, on contest declined

to grant the temporary injunction to the plaintiffs.

It is not in dispute that during the pendency of the

suit, the services of these workers were

discontinued. They were, therefore, no more in the

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Page 7 employment.

11. By judgment and decree dated 27.05.1983,

the trial Court decreed the suit and held that the

plaintiff's are entitled to continue in services of

BCCL.

12.Felt aggrieved, the BCCL filed Title Appeal

No. 71 of 1983 before the Appellate Court. The

Appellate Court by judgment and order dated

16.12.1986 dismissed the appeal and confirmed

the judgment and decree of the Trial Court.

13.The BCCL pursued the matter further and

filed an appeal being Second Appeal No.23 of

1987(R) before the High Court. The High Court, by

judgment and order dated 05.03.1993 allowed the

Second Appeal and set aside the judgment and

decree of the two Courts which had decreed the

plaintiffs’ suit. It was held that the suit was not

maintainable in the light of provisions of Labour

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Page 8 laws.

14.Against the aforesaid judgment, the plaintiffs

(workers) filed Special Leave Petition being Special

Leave Petition (C) No. 4495 of 1994 before this

Court. By order dated 14.11.1994, this Court,

after granting leave, dismissed the appeal (C.A.

No.8403/1994) with a liberty to the

plaintiffs/appellants to approach the Industrial

Tribunal for claiming any appropriate relief, if so

advised.

15.It is with this background, the plaintiffs (five

workers) approached the Central Government

under Section 10 of the Act and also on behalf of

as many as 150 workers espousing their cause in

representative capacity for their absorption and

regularization and prayed for making an industrial

reference to the Industrial Tribunal for its

adjudication. The Government acceded to their

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Page 9 request and accordingly made the following

reference to the Industrial Tribunal to adjudicate:

“Whether the management of Sudamdih

Coal Washery of M/s Bharat Coking Coal

Ltd., P.O. Sudamdih, Dist. Dhanbad are

justified in not absorbing Ainuel Haque

and 150 others (as in the list annexed) as

their regular employees? If not, to what

reliefs are the said workmen entitled?”

16.The Industrial Tribunal by award dated

21.12.1998 answered the reference against the

workers. It was held that they were not entitled to

seek their absorption in the Services of BCCL as

their regular employees. The workers, felt

aggrieved, filed C.W.J.C.No. 616 of 1999(R) before

the High Court. The learned single Judge by orders

dated 03.09.2009 dismissed the writ petition and

upheld the award passed by the Tribunal. The

workers pursued the matter and filed intra Court

appeal being L.P.A. No. 447 of 2009. The Division

Bench by impugned judgment dismissed the

appeal finding no fault in the award. Challenging

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Page 10 the said order, the workers filed this appeal by

way of special leave before this Court.

17.While assailing the legality and correctness of

the impugned judgment, Mr. R.P. Bhatt, learned

Senior Counsel for the appellants mainly urged

two points. His first submission was that the

Courts below erred in not answering the reference

in favour of the appellants and thereby Courts

below erred in not granting them the relief for

which the reference was made. His second

submission was that since the identical reference

(Reference Case No.58/1981) made at the

instance of 39 workers alike the appellants was

answered in workers’ favour vide award dated

03.03.1983, a fortiori, the present reference being

identical in nature should also have been

answered in favour of the appellants to maintain

the parity. In other words, the submission was that

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Page 11 if one set of workers got the benefit earlier in point

of time from the Court, the other set of workers

similarly placed too should have been granted the

same benefits. In the alternative, learned Senior

Counsel urged that in any event, the appellants

were not paid any retrenchment compensation, for

which otherwise they were entitled to get from the

Contractor or/and BCCL as per the provisions of

Section 25 of the Act read with the provisions of

Contract Labour Prohibition and Regulation Act,

1970 and hence to this extent, this Court can still

direct either Contractor or the BCCL or both, as the

case may be, to pay the retrenchment

compensation to the appellants.

18.In Contra, learned Counsel for the

respondent-BCCL supported the impugned order

and contended that no case is made out by the

appellants to interfere in the impugned order and

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Page 12 hence the appeal merits dismissal.

19.Having heard the learned counsel for the

parties and on perusal of the record of the case,

we find no merit in the main submissions of the

appellants but find substance in the alternative

submission.

20.Before we examine the factual matrix of the

case in hand, we consider it apposite to take note

of law laid down by this Court regarding the

powers of the appropriate Government in making

reference under Section 10 of the Act and the

jurisdiction of the Tribunal while answering the

reference. Indeed it is well settled and remains no

more res integra.

21.One of the questions which fell for

consideration by this Court in Delhi Cloth and

General Mills Co. Ltd. vs. The Workmen and

Others (AIR 1967 SC 469) was that what are the

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Page 13 powers of the appropriate Government while

making a reference and the scope and jurisdiction

of Industrial Tribunal under Section 10 of the Act.

22.Justice Mitter, speaking for the Bench, held

as under:

“(8) ……Under S. 10(1)(d) of the Act, it is

open to the appropriate Government when

it is of opinion that any industrial dispute

exists to make an order in writing referring

"the dispute or any matter appearing to be

connected with, or relevant to the dispute,

…..to a Tribunal for adjudication" under s.

10(4)

"where in an order referring an industrial

dispute to a Labour Court, Tribunal or

National Tribunal under this section or in a

subsequent order, the appropriate

Government has specified the points of

dispute for adjudication, the Labour Court

or the Tribunal or the National Tribunal, as

the case may be, shall confine its

adjudication to those points and matters

incidental thereto."

(9) From the above it therefore appears

that while it is open to the appropriate

Government to refer the dispute or any

matter appearing to be connected

therewith for adjudication, the Tribunal

must confine its adjudication to the points

of dispute referred and matters incidental

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Page 14 thereto. In other words, the Tribunal is not

free to enlarge the scope of the dispute

referred to it but must confine its attention

to the points specifically mentioned and

anything which is incidental thereto. The

word 'incidental' means according to

Webster's New World Dictionary :

"happening or likely to happen as a result

of or in connection with something more

important; being an incident; casual;

hence, secondary or minor, but usually

associated :"

"Something incidental to a dispute" must

therefore mean something happening as a

result of or in connection with the dispute

or associated with the dispute. The dispute

is the fundamental thing while something

incidental thereto is an adjunct to it.

Something incidental, therefore, cannot

cut at the root of the main thing to which it

is an adjunct to it…..”

23.The same issue came up for consideration

before three Judge Bench in a case reported in

Pottery Mazdoor Panchayat vs. Perfect

Pottery Co. Ltd. and Another, (1979) 3 SCC

762. Justice Y.V. Chandrachud - the learned Chief

Justice speaking for the Court laid down the

following proposition of law:

“10. Two questions were argued before

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Page 15 the High Court: Firstly, whether the

tribunals had jurisdiction to question the

propriety or justification of the closure

and secondly, whether they had

jurisdiction to go into the question of

retrenchment compensation. The High

Court has held on the first question that

the jurisdiction of the Tribunal in

industrial disputes is limited to the points

specifically referred for its adjudication

and to matters incidental thereto and

that the Tribunal cannot go beyond the

terms of the reference made to it. On the

second question the High Court has

accepted the respondent’s contention

that the question of retrenchment

compensation has to be decided under

Section 33-C(2) of the Central Act.

11. Having heard a closely thought out

argument made by Mr. Gupta on behalf of

the appellant, we are of the opinion that

the High Court is right in its view on the

first question. The very terms of the

references show that the point of dispute

between the parties was not the fact of

the closure of its business by the

respondent but the propriety and

justification of the respondent’s decision

to close down the business. That is why

the references were expressed to say

whether the proposed closure of the

business was proper and justified. In

other words, by the references, the

Tribunals were not called upon by the

Government to adjudicate upon the

question as to whether there was in fact a

closure of business or whether under the

pretence of closing the business the

workers were locked out by the

management. The references being

limited to the narrow question as to

whether the closure was proper and

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Page 16 justified, the Tribunals by the very terms

of the references, had no jurisdiction to

go behind the fact of closure and inquire

into the question whether the business

was in fact closed down by the

management.”

24.The abovesaid principle of law has been

consistently reiterated in M/s Firestone Tyre &

Rubber Co. of India (P) Ltd. vs. The Workmen

Empoloyed, represented by Firestone Tyre

employees’ Union AIR 1981 SC 1626, National

Engineering Industries Ltd. vs. State of

Rajasthan & Ors., (2000) 1 SCC 371, Mukand

Ltd. vs. Mukand Staff & Officers’ Association ,

(2004) 10 SCC 460 and State Bank of Bikaner

& Jaipur vs. Om Prakash Sharma , (2006) 5 SCC

123.

25.It is thus clear that the appropriate

Government is empowered to make a reference

under Section 10 of the Act only when "Industrial

dispute exists" or “is apprehended between the

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Page 17 parties”. Similarly, it is also clear that the Tribunal

while answering the reference has to confine its

inquiry to the question(s) referred and has no

jurisdiction to travel beyond the question(s) or/and

the terms of the reference while answering the

reference. A fortiori, no inquiry can be made on

those questions, which are not specifically referred

to the Tribunal while answering the reference.

26.Coming now to the facts of this case, it is an

admitted case that the services of the appellants

and those at whose instance the reference was

made were terminated long back prior to making

of the reference. These workers were, therefore,

not in the services of either Contractor or/and

BCCL on the date of making the reference in

question. Therefore, there was no industrial

dispute that "existed" or "apprehended" in relation

to appellants’ absorption in the services of the

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Page 18 BCCL on the date of making the reference.

27.Indeed a dispute regarding the appellants’

absorption was capable of being referred to in

reference for adjudication, had the appellants

been in the services of Contractor or/and BCCL.

But as said above, since the appellants’ services

were discontinued or/and retrenched (whether

rightly or wrongly) long back, the question of their

absorption or regularization in the services of

BCCL, as claimed by them, did not arise and nor

this issue could have been gone into on its merits

for the reason that it was not legally possible to

give any direction to absorb/regularize the

appellants so long as they were not in the

employment.

28.It is a settled principle of law that absorption

and regularization in the service can be claimed

or/and granted only when the contract of

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Page 19 employment subsists and is in force inter se

employee and employer. Once it comes to an end

either by efflux of time or as per the terms of the

Contract of employment or by its termination by

the employer, then in such event, the relationship

of employee and employer comes to an end and

no longer subsists except for the limited purpose

to examine the legality and correctness of its

termination.

29.In our considered opinion, the only industrial

dispute, which existed for being referred to the

Industrial Tribunal for adjudication was in relation

to termination of appellants’ employment and -

whether it was legal or not? It is an admitted fact

that it was not referred to the Tribunal and,

therefore, it attained finality against the

appellants.

30.In our considered opinion, therefore, the

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Page 20 reference, even if made to examine the issue of

absorption of the appellants in the services of

BCCL, the same was misconceived.

31.Apart from this infirmity noticed in this case,

we have also not been able to find any parity in

the facts of the earlier reference (R.C.No.58/81)

and the case in hand. As noted above, the earlier

reference was made to decide the absorption of 39

workers in the BCCL. This could be made because

they were in the service. So far as the present

case is concerned, the appellants were not in

service.

32.It can safely be noted that merely because

the workers in both the references were working in

one project by itself was not enough to give them

any right to claim parity with the claim of others.

So long as, the parity was not proved on all the

relevant issues arising in the case, no worker

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Page 21 whether individual or collectively was entitled to

claim the relief only on the basis of similarity in

the status qua employer.

33.In the light of foregoing discussion, we are of

the considered opinion that the reference made to

examine the issue of appellants’ absorption qua

the BCCL was incapable of being referred to on the

said question and in any event, it was incapable

of being answered in favour of the appellants.

34.That apart, when three Courts, despite this

infirmity, went into the facts and held that the

appellants were not entitled to claim any

absorption in the services qua the BCCL, then in

our considered opinion, they were right in holding

so and we do not find any good ground to go into

the factual issues de novo in our appellate

jurisdiction. The factual findings recorded by the

three Courts are binding on this Court.

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Page 22 35.We, therefore, find no ground to set aside the

impugned order and accordingly uphold the same.

36.This takes us to the next question as to

whether the appellants are entitled to claim the

relief of payment of retrenchment compensation.

Having given our anxious consideration to this

issue, we are of the considered view that having

regard to the peculiar facts of this case and the

reasons, which we have set out hereinbelow, we

are inclined to hold that the appellants are entitled

to claim the retrenchment compensation from the

Contractor/BCCL.

37.It is for the reason that firstly, the respondent

in their written statement filed before the Tribunal

have offered to pay the retrenchment

compensation to all such workers in accordance

with the provisions of Section 25F of the Act.

Secondly, no documents were filed by the

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Page 23 respondent to show that any such compensation

was paid to the appellants or to any worker till

date by the respondent and lastly, more than

three decades have passed and yet the issues of

absorption, and/or payment of compensation has

not attained finality.

38.Indeed, in similar circumstances, this Court in

the case of Pottery Mazdoor Panchayat’s case

(supra) had directed payment of retrenchment

compensation to the workers and made the

following pertinent observations in the concluding

paras:

“17. It is unnecessary to consider the

second question as regards the payment

of retrenchment compensation and we

will, therefore, express no opinion as to

whether the Tribunals had jurisdiction to

go into that question. Happily, the parties

have arrived at a settlement on that

question under which, the respondent

agrees to fix within a period of six months

from today the retrenchment

compensation payable to the retrenched

workers in accordance with the provisions

of Section 25FFF of the Central Act,

namely, the Industrial Disputes Act, 1947,

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Page 24 without the aid of the proviso to that

section. After the retrenchment

compensation is so fixed, a copy of the

decision fixing the compensation payable

to each of the worker will be sent by the

respondent to the appellant Union. The

workers or their legal representatives, as

the case may be, will then be entitled to

receive the retrenchment compensation

from the respondent, which agrees to pay

the same to them. The respondent will be

entitled to set off of the amounts of

retrenchment compensation already paid

to the workers against the amounts found

due to them under this settlement. On

receiving the retrenchment compensation

the workers concerned shall withdraw the

applications, if any, filed by them for

relief in that behalf.

18. We would only like to add that the

compensation which will be paid to the

workers will be without prejudice to their

right, if any, to get employment from the

respondent in the new business as and

when occasion arises.”

39.Following the course adopted by this Court in

Pottery Mazdoor Panchayat (supra), we direct

the Industrial Tribunal to verify the case of the

appellants (150 or so) for deciding each worker’s

claim for payment of retrenchment compensation

to him/her as per the provisions of Section 25F of

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Page 25 the Act and accordingly he/she be paid

retrenchment compensation. In case any worker

has expired then his/her compensation amount be

paid to his/her legal representative after making

proper verification of the case.

40.We, however, make it clear that the

respondent would not raise any objection about

the maintainability of workers’ claim nor would

raise any objection on merits before the Tribunal

and the inquiry would only confine to determine

the quantum of retrenchment compensation

payable to each worker.

41.The appellants and respondents would

appear before the Tribunal on 16.02.2015 and file

necessary documents to enable the Tribunal to

verify the claim of each worker for determining the

quantum of compensation. The Tribunal would

issue notice to the Contractor to enable them to

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Page 26 participate in the proceedings in the light of

provisions of Contract Labour Prohibition and

Regulation Act, 1970. The appellants and all such

workers can be represented through recognized

Union before the Tribunal.

42.The entire exercise should be completed and

payment be made to the workers within six

months.

43.With these directions, the appeal stands

disposed of.

…………… .….

……...................................J.

[FAKKIR MOHAMED IBRAHIM KALIFULLA]

……… ..

………………..................................J.

[ABHAY MANOHAR SAPRE]

New Delhi;

February 02, 2015.

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