Writ Petition Nos. 738 and 739 of 2015. Case: Chowgule Industries Pvt. Ltd. Vs Sakharam Gad and Ors.. High Court of Bombay (India)

Case NumberWrit Petition Nos. 738 and 739 of 2015
CounselFor Appellant: Atul Damle, Senior Advocate, Rajesh Kinnerkar and Pretam Talaulikar, Advocates and For Respondents: Bennet D'Costa, Senior Advocate and Ryan Menezes, Advocate
JudgesK. L. Wadane, J.
IssueConstitution of India - Article 227; Industrial Disputes Act, 1947 - Sections 10A, 12(3), 18, 18(3)
Judgement DateDecember 18, 2015
CourtHigh Court of Bombay (India)


K. L. Wadane, J.

  1. Heard Mr. Atul Damle, learned Senior Counsel appearing for the petitioner and Mr. Bennet D'Costa, learned Senior Counsel appearing for the respondent nos. 1 to 14 in Writ Petition No. 738/2015 and for respondent no. 1 in Writ Petition No. 739/2015.

  2. Rule made returnable forthwith.

  3. Heard by consent of the learned counsel appearing for the respective parties. Mr. R. Menezes, learned Counsel waives notice on behalf of the respondent nos 1 to 14 in Writ Petition No. 738/2015 and for the respondent no. 1 in Writ Petition no. 739/2015.


  4. The present petition is filed by the petitioner/ Employer under Article 227 of the Constitution of India and seeks to challenge the award dated 8.7.2015 passed by the Industrial Tribunal and Labour Court in Reference No. IT/10/2011 wherein benefits of settlement was directed to be made applicable to the workers.

  5. Parties are referred to as per their original status. The brief facts may be stated as follows:-

    In the claim settlement it is in short, the case of Party I/ workmen that the employer and the committee of Chowgule Industries Ltd. (Automobile Division) Workers Unity entered into a settlement dated 22.3.2005 which was signed under Section 12(3) read with Section 18(3) of the Industrial Disputes Act, 1947 ("the Act" for short). It is stated that as per this settlement, it was agreed that all the workmen will be paid variable Dearness Allowances ("VDA" for short) on the basis of the All India Consumer Price Index (Base 1960=100). The parties had also agreed for neutralization rate of Rs. 1.85 per point rise/fall from 870 to 1000 points and Rs. 1.95 per point rise/fall from 1001 and above. It is stated that this settlement covered all the workmen at that time and was operative from 1.7.2004 to 30.06.2008. It is stated that in May 2008, almost all permanent workmen employed at Sales and Services Centers of Party II joined Gomantak Mazdoor Sangh("GMS" for short) and this fact was communicated to Party II by GMS by letter dated 14.5.2008. It is stated that existing settlement was to expire on 30.6.2008 and the workmen submitted their Charter of Demand ("COD" for short) vide letter dated 10.6.2008. It is stated that matter of COD is pending before this Tribunal under Ref. No. IT/29/2009. It is stated that GMS then realized that the workers whose services has been confirmed subsequent to the settlement dated 22.3.2005 were not paid any VDA and therefore, GMS on behalf of these 14 workmen wrote a letter dated 6.7.2009 to Party II explaining the position and demanding that their VDA be paid. Correspondence was then exchanged between the parties and Dy. Labour Commissioner Panaji, however, finally the matter ended in failure. It is stated that the benefits of a settlement continue to flow even after its expiry and by virtue of Section 18 of the Act the benefits of a settlement are extended to all the workmen who have been confirmed in service subsequent to the settlement. It is therefore prayed to hold that the action of Party II in not paying VDA as per the settlement dated 22.3.2005 to the 14 workmen is illegal and unjustified and to order Party II to pay VDA as per this settlement from the respective date of joining of the 14 workmen mentioned in the order of reference.

  6. In defence, Party II has denied the case set up by Party I in the claim statement and has stated that Party I union has no locus standi to espouse the present demand and that the said demand cannot and do not constitute an Industrial Dispute. It is stated that the said demand is subject matter in Ref. IT/29/2009 and therefore, it is barred by res-judicata or principles analogous to res-judicata. It is stated that terms of reference are defective as it presupposes payment of VDA to certain class of employees who were not even parties to the said settlement. It is stated that Party II has complied with all its rights and obligations as per the said settlement dated 22.3.2005 and that they are aware that the benefits of the said settlement dated 22.3.2005 and that they are aware that the benefits of the said settlement continue even after termination or till replaced by a new settlement, Award or agreement. It is stated that the concerned 14 employees were not parties to the said settlement and also never extended any benefits of the said settlement. It is stated that the concerned persons cannot make a grievance of not being paid VDA, whether by settlement or otherwise when the service conditions agreed by them with the management did not comprise of the component of VDA. It is stated that instead of VDA the concerned employees are receiving incentives of monthly average amounting to Rs. 4000/- to 6500/- and from the day the concerned employees were engaged, the VDA was not a part and parcel of their remuneration and neither they were party or beneficiary to the settlement dated 22.3.2005. It is stated that the concerned employees were given benefits of mutually agreed terms and conditions and therefore they did not make any grievance regarding the same. It is stated that any additional burden if imposed on the company would have grave consequences for the industry in general and also a crippling effect on its financial capacity there by jeopardizing the very survival of the company in the highly competitive market. It is stated that the service conditions, mutually agreed with the concerned employees did not include payment of VDA. Thus, amongst the above and other objections...

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