Cannanore Co-operative Milk Supply Union Ltd. vs The Labour Court and Others

Balagangadharan Nair, J.—Respondents 3 to 12 were workmen in the service of the Petitioner, the Cannanore Co-operative Milk Supply Union Ltd. They filed an application Ext. P-1 C.P. No. 5 of 1979--under Section 33C(2), Industrial Disputes Act before the 1st Respondent, the Labour Court, Kozhikode claiming the payment of certain amounts from the Petitioner. They stated that by virtue of an agreement dated 11th October 1974 between the Petitioner and the Cannanore Co-operative Milk Supply Society Ltd. The Society took over 13 employees of the Petitioner including Respondents 3 to 12 with effect from 1st November 1974. It was alleged that the Petitioner had not paid them the retrenchment compensation legally due to them for the period of their service or the security amounts or the Provident Fund amounts, even though the Petitioner had admitted the liability to pay them. They appended a schedule to the application specifying the sums variously due to them deducting the amounts which they owed to the Petitioner. The schedule listed the periods of their service, the retrenchment compensation, the security deposits and Provident Fund amounts (both with interest) and the sums owed by them. The Petitioner entered appearance before the 1st Respondent through counsel on 26th March 1979 which was the first hearing. After two further adjournments at the Petitioner''s instance to file the written statement the case came up on 11th July 1979. No written statement was filed and on 11th July 1979 the Petitioner''s counsel was also absent. The first Respondent declared the Petitioner ex parte and posted the case to 16th August 1979. The Respondents thereupon filed an affidavit in proof of their claims. The 1st Respondent accepted the affidavit and by its order Ext. P-2, dated 9th January 1980 allowed the application Ext. P-1. As the order Ext. P-2 remained unimplemented the 2nd Respondent, the District Labour Officer, Cannanore issued the Petitioner a notice Ext. P-3, dated 11th June 1980 to show cause why action should not be taken for recovering the amount u/s 33C(4) and for prosecution u/s 29. The Petitioner seeks to quash Ext. P-2.

Despite opportunities the Petitioner had not controverted the statements in Ext. P-1 before the 1st Respondent. The Petitioner could not reasonably plead lack of opportunity, for between 26th March 1979, the date of first hearing and 16th August 1979, when it was declared ex parte there were three occasions--with the first hearing there were four--for the Petitioner to prepare and submit the written statement of defence. I have therefore to accept the statements of fact in Ext. P-1 and decide the Original Petition on that footing.

The principal, in fact the only contention urged by counsel for the Petitioner was that the 1st Respondent had no jurisdiction to entertain Ext. P-1 and pass the order Ext. P-2 u/s 33C(2). This contention primarily involves the scope of Section 33C(2). The point is no longer res integra as it has been the subject of various decisions by the Supreme Court. In one of the early decisions Punjab National Bank Limited Vs. K. L. Kharbanda, , the Supreme Court held that the expression "benefit" in Section 33C(2) is of wide import and is not confined merely to nonmonetary benefit which could be converted in terms of money but is concerned with all kinds of benefits, whether monetary or non-monetary, to which a workman may be entitled, say for example under an award and that the subsection comes into play when the benefits have to be computed or calculated and there is a dispute as to the calculation or computation. It was also held that Section 33C is a provision in the nature of execution. In a subsequent case The Central Bank of India Ltd. Vs. P.S. Rajagopalan etc., the Supreme Court considered the scope of Section 33C in greater detail. After pointing out that Section 33C(2) is wider than Sub-section (1) the Court held that while the three categories of claims mentioned in Section 33C(1) fall u/s 33C(2) it is possible that claims not based on settlements, awards or made under the provisions of Chapter V A, may also be competent u/s 33C(2). The court illustrated some of the claims that might fall under Sub-section (2) and affirmed that Sub-section (2) was in the nature of an execution proceeding for enforcement of the individual benefits of the workmen. The scope of Sub-section (2) was again considered and the Central Bank''s case was noted in Bombay Gas Co. Ltd. Vs. Gopal Bhiva and Others, . In the State Bank of Bikaner and Jaipur v. Khandelwal 1968 (1) LL.J. 589, the Supreme Court while affirming the law as laid down in the earlier decisions on the scope of the function and power of a Labour Court u/s 33C(2) added that it should be made clear that a workman cannot put forward a claim in the application u/s 33C(2) in respect of a matter which is not based on an existing right and which can be approximately the subject-matter of an industrial dispute requiring a reference u/s 10 of the Act. The Petitioner has a contention based upon this observation and its validity can be considered below. In Central Inland Water Transport Corporation Limited Vs. The Workmen and Another, , the Court noted the earlier decisions and reaffirmed that the function of the Labour Court u/s 33C(2) was essentially in the nature of an execution proceeding. It however pointed out that while exercising the jurisdiction the Labour Court has got to be circumspect before it undertakes an investigation, reminding itself that any investigation it undertakes is, in a real sense incidental to its computation of a benefit under an existing right, which is its principal concern. Reference might also be made to a still later case Punjab Beverages Pvt. Ltd., Chandigarh Vs. Suresh Chand and Another, , where the Supreme Court, so far as relevant, repeated the execution nature of the powers under Sub-section (2).

While the existence of a right is a condition precedent to an application u/s 33C(2) the fact that it is denied or that the examination of the claim requires an enquiry into the existence of the right, does not exclude the jurisdiction of the Labour Court: The Central Bank of India Ltd. Vs. P.S. Rajagopalan etc., .

Counsel for the Petitioner did not dispute the nature of the jurisdiction of the Labour Court u/s 33C(2) as explained by these various decisions but he contended that the jurisdiction postulates the existence of a right under a settlement or award and as there was no such settlement or award in favour of the workmen the 1st Respondent had no jurisdiction to entertain Ext. P-1 and make the order Ext. P-2. But as pointed out by the Supreme Court Sub-section (2) of Section 33C is not confined to the enforcement of rights under awards and settlements nor is the power under Sub-section (2) taken away by the denial of the right or the necessity of an inquiry before enforcing the right. Ext. P-1 cannot be held to be incompetent on the more ground that it was not based upon an award or settlement. It was grounded upon rights pleaded by Respondents 3 to 12 under the Industrial Disputes Act, rights in the nature of retrenchment benefits and Provident Fund amount along with the return of deposits. Even if the deposits are left out, the claims in respect of retrenchment and Provident Fund were existing rights on the averments in Ext. P-1. Those averments, it might be repeated, were not challenged nor made the subject of issues before the 1st Respondent. On those facts Ext. P-1 was validly presented and the 1st Respondent had jurisdiction to entertain it and give the decision Ext. P-2. The Petitioner''s challenge against Ext. P-2 cannot be sustained.

I dismiss the Original Petition. In the circumstances, parties will bear their costs.