Case Note & Summary
The petitioners, M/s. Fomento Resorts & Hotels Ltd. and its hotel establishment Cidade de Goa, challenged an order dated 13.03.2012 passed by the Industrial Tribunal-cum-Labour Court-1, Goa. The Tribunal had rejected a preliminary issue raised by the petitioners that no appropriate notice under Section 19(2) of the Industrial Disputes Act, 1947 was served on them to terminate a settlement. The settlement between the petitioners and the respondent workmen, represented by the Cidade de Goa Hotel Employee's Union, was valid until 31.01.2008. The respondents served a notice dated 01.11.2007, received by the petitioners on 07.11.2007, purporting to terminate the settlement. The petitioners argued that under Section 19(2), a two-month notice is mandatory, and since the notice period expired on 07.01.2008, before the settlement's expiry on 31.01.2008, the notice was ineffective. The respondents contended that they had shown intention to terminate. The court, relying on Supreme Court judgments in Management of Bangalore Woollen Cotton and Silk Mills Co. Ltd. v. Workmen (AIR 1968 SC 585) and M/s. Shukla Manseta Industries Pvt. Ltd. v. The Workmen (AIR 1977 SC 2246), held that a notice served during the subsistence of a settlement is invalid and cannot terminate it before its agreed expiry. The court allowed the petition, set aside the impugned order, and directed the Tribunal to decide the preliminary issue in favor of the petitioners.
Headnote
A) Industrial Law - Settlement Termination - Notice under Section 19(2) of Industrial Disputes Act, 1947 - Validity of notice served during subsistence of settlement - The issue was whether a notice of termination served on 07.11.2007, with two months' period expiring on 07.01.2008, could terminate a settlement valid until 31.01.2008 - The Court held that such notice is ineffective as the settlement continues to be binding until its expiry date, and the notice cannot operate to terminate it prematurely - The impugned order rejecting the preliminary issue was set aside (Paras 2-5).
Issue of Consideration
Whether a notice under Section 19(2) of the Industrial Disputes Act, 1947 served during the subsistence of a settlement is valid to terminate the settlement before its expiry date
Final Decision
The petition is allowed. The impugned order dated 13.03.2012 passed by the Industrial Tribunal is set aside. The Tribunal is directed to decide the preliminary issue in favor of the petitioners.
Law Points
- Section 19(2) of Industrial Disputes Act
- 1947 requires two months' notice to terminate settlement
- notice served during subsistence of settlement is invalid
- settlement remains binding until expiry of agreed period
Case Details
2012 LawText (BOM) (06) 116
WRIT PETITION NO. 329 OF 2012
Mr. J. E. Coelho Pereira, Senior Advocate with Mr. Abhijit A. S. Dessai, Advocate for the Petitioners; Shri Shivraj Goakar, Advocate for the Respondents
M/s. Fomento Resorts & Hotels Ltd. and M/s. Cidade de Goa
Workmen represented by Cidade de Goa Hotel Employee's Union and Presiding Officer, Industrial Tribunal-cum-Labour Court-1
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Nature of Litigation
Writ petition challenging order of Industrial Tribunal rejecting preliminary issue regarding validity of notice under Section 19(2) of Industrial Disputes Act, 1947
Remedy Sought
Petitioners sought to set aside the impugned order and have the preliminary issue decided in their favor
Filing Reason
Petitioners contended that no valid notice under Section 19(2) was served to terminate the settlement
Previous Decisions
Industrial Tribunal rejected the preliminary issue raised by petitioners on 13.03.2012
Issues
Whether a notice under Section 19(2) of the Industrial Disputes Act, 1947 served during the subsistence of a settlement is valid to terminate the settlement before its expiry date
Submissions/Arguments
Petitioners argued that under Section 19(2), two months' notice is mandatory; notice received on 07.11.2007 expired on 07.01.2008, before settlement expiry on 31.01.2008, hence ineffective
Respondents contended that they had shown intention to terminate the settlement under Section 19(2)
Ratio Decidendi
A notice under Section 19(2) of the Industrial Disputes Act, 1947 served during the subsistence of a settlement is invalid and cannot terminate the settlement before its agreed expiry date; the settlement remains binding until its expiry.
Judgment Excerpts
The above Petition challenges the Order dated 13.03.2012 passed by the learned Industrial Tribunal whereby the preliminary issue raised by the Petitioners to the effect that no appropriate notice under Section 19(2) of Industrial Disputes Act, 1947, served on the Petitioners to terminate the settlement came to be rejected.
Learned Senior Counsel further pointed out that the settlement arrived at between the Petitioners and the Union/Respondents, was for a period ending 31.01.2008.
In support of his submissions, learned Senior Counsel has relied upon the Judgments of the Apex Court reported in AIR 1968 S. C. 585 in the case of Management of the Bangalore Woollen Cotton and Silk Mills Co. Ltd. vs. Workmen and anr. and AIR 1977 S. C. 2246 in the case of M/s. Shukla Manseta Industries Pvt. Ltd., vs. The Workmen employed under it.
Procedural History
The Industrial Tribunal rejected the preliminary issue on 13.03.2012. The petitioners filed Writ Petition No. 329 of 2012 in the High Court of Bombay at Goa challenging that order. The High Court heard the matter on 14.06.2012 and allowed the petition.
Acts & Sections
- Industrial Disputes Act, 1947: Section 19(2)
