Case Note & Summary
This matter arises from a long-standing industrial dispute between Nashik Workers Union ('the Union') and Hindustan Aeronautics Limited ('HAL'), a public sector undertaking. The Union represented about 127 individuals who had undergone apprenticeship training with HAL under the HAL Apprenticeship Scheme. After the training period, their engagements were terminated. The Union initially approached the Bombay High Court by way of Writ Petition No. 5445 of 1989 seeking reinstatement and permanency. During the hearing, HAL made a statement that the workmen would be given first preference in filling regular vacancies subject to qualifications. Based on this undertaking, the Union withdrew the writ petition on 9 February 1990. Subsequently, alleging non-compliance with the undertaking, the Union filed complaints (ULP Nos. 35, 36, 44 and 45 of 1990) under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 ('MRTU and PULP Act') before the Labour Court at Nashik. The Labour Court, by orders dated 8 August 1994 and 8 July 1997, directed reinstatement and grant of permanency benefits to the workmen. The Industrial Court confirmed these orders.
HAL challenged the Labour Court and Industrial Court orders by filing Writ Petition No. 3562 of 1997 in the Bombay High Court. By judgment dated 2 March 2001, a learned Single Judge allowed the writ petition, holding that the appropriate government for the dispute was the State Government, thus the MRTU and PULP Act complaints were maintainable. However, the Single Judge set aside the reinstatement and permanency orders on merits and directed HAL to offer regular appointments to the workmen as and when vacancies arose, provided they met the required qualifications.
The Union appealed in Letters Patent Appeal No. 144 of 2002, while HAL filed a cross-appeal (LPA No. 84 of 2006) challenging the finding on the appropriate government issue. A Division Bench of the High Court, by judgment dated 25 June 2009, allowed HAL's appeal, holding that the Central Government was the appropriate government, and therefore the MRTU and PULP Act complaints were not maintainable. Consequently, LPA No. 144 of 2002 filed by the Union was disposed of as having survived no longer.
The Union carried the matter to the Supreme Court in Civil Appeal Nos. 9332-9333 of 2010. The Supreme Court, by judgment dated 26 February 2016, set aside the Division Bench order of 25 June 2009 and revived LPA No. 144 of 2002, remanding it to the High Court for fresh adjudication on merits.
Upon remand, both parties requested the Division Bench to hear the main writ petition itself to avoid further remand. Accordingly, the court heard submissions on the issues raised in Writ Petition No. 3562 of 1997. HAL's arguments, as recorded in the judgment excerpt, focused on several grounds: (1) the complaints were barred by res judicata and principles analogous to Order 23 Rule 1 CPC because the Union had earlier withdrawn a writ petition on the same cause of action after obtaining an undertaking from HAL; (2) the individuals were trainees/apprentices under the HAL Apprenticeship Scheme and hence not 'workmen' under Section 2(s) of the Industrial Disputes Act, 1947; (3) their engagement was for a fixed term, and termination at the end of such term fell within the exception under Section 2(oo)(bb), not amounting to retrenchment; (4) only two out of the 127 persons were examined as witnesses, and there was no evidence on behalf of the remaining 125; (5) grant of reinstatement and permanency would amount to a back-door entry, contrary to the Constitution Bench decision in State of Karnataka v. Umadevi (2006) 4 SCC 1, especially as HAL's recruitments are governed by statutory rules; (6) the Labour Court ignored the absence of sanctioned vacancies and a recruitment ban circular dated 10 June 1989; and (7) the burden to prove non-employment for backwages was incorrectly placed on the employer. HAL also submitted that in compliance with the earlier undertaking and orders, 80 of the 127 had been regularly appointed, offers had been made to several others, and many had failed to qualify.
The judgment excerpt ends during the recording of submissions by HAL's senior counsel. The Union's arguments and the court's analysis, findings, and final decision are not available in the extracted text.
Issue of Consideration
(1) Whether the complaints under MRTU and PULP Act were barred by res judicata or principles analogous to Order 23 Rule 1 CPC; (2) Whether the workmen were 'workmen' under Section 2(s) of the Industrial Disputes Act; (3) Whether termination of fixed-term engagements fell under exception of Section 2(oo)(bb) and not retrenchment; (4) Whether relief could be granted to all 127 workmen based on evidence of only two; (5) Whether grant of reinstatement and permanency violated recruitment rules and Umadevi principle; (6) Whether vacancies existed or a recruitment ban was in effect; (7) Burden of proof regarding gainful employment and backwages.
Case Details
2018 LawText (BOM) (10) 112
Letters Patent Appeal No. 144 of 2002 in Writ Petition No. 3562 of 1997
Gayatri Singh, Senior Advocate with Ankit Kulkarni, Mini Mathews, Bhavana Mhatre instructed by Kranti L.C.; Sudhir Talsania, Senior Advocate with Vinod N. Tayade instructed by Piyush Shah
Hindustan Aeronautics Limited (HAL)
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Nature of Litigation
Industrial dispute involving complaints under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971, alleging unfair labour practices in terminating and not granting permanency to apprentice workers of a public sector undertaking.
Remedy Sought
The Union sought reinstatement and permanency benefits for about 127 workmen. HAL challenged the jurisdiction and merits of the complaints.
Filing Reason
Following withdrawal of an earlier writ petition where HAL undertook to give preference in regular appointments, the Union filed complaints under the MRTU and PULP Act alleging non-compliance and illegal termination.
Previous Decisions
Labour Court and Industrial Court granted reinstatement and permanency. Single Judge of High Court set aside those orders on merits and directed regular appointments as vacancies arise. Division Bench held complaints not maintainable due to appropriate government issue, but Supreme Court remanded for fresh adjudication on merits.
Issues
Whether complaints under MRTU and PULP Act were barred by res judicata, estoppel, or principles analogous to Order 23 Rule 1 CPC due to earlier withdrawal of writ petition.
Whether the workmen were 'workmen' under Section 2(s) of the Industrial Disputes Act, 1947, given their engagement as apprentices/trainees under the HAL Apprenticeship Scheme.
Whether termination of fixed-term engagements fell within the exception under Section 2(oo)(bb) of the Industrial Disputes Act and thus did not constitute retrenchment requiring compliance with Sections 25F/25N.
Whether the Labour Court could grant relief to all 127 workmen on the basis of evidence of only two among them.
Whether grant of reinstatement and permanency violated statutory recruitment rules and the principle against back-door entry as laid down in State of Karnataka v. Umadevi.
Whether there were sufficient vacancies or posts to accommodate the 127 workmen, especially in view of a recruitment ban circular.
On whom lies the burden of proving that workmen were gainfully employed during pendency of proceedings, and whether backwages could be awarded absent such proof.
Submissions/Arguments
HAL argued that the complaints were barred by res judicata and estoppel because the Union had earlier withdrawn a writ petition on the same cause of action after HAL gave an undertaking to give preference in regular appointments, and the Union later filed contempt petitions based on that undertaking.
HAL contended that the individuals were trainees/apprentices under the HAL Apprenticeship Scheme and not 'workmen' under Section 2(s) of the Industrial Disputes Act, depriving the Labour Court of jurisdiction.
HAL submitted that the engagement letters stipulated fixed terms, and termination at the end of such term fell within the exception of Section 2(oo)(bb), not amounting to retrenchment.
HAL argued that only two out of the 127 persons were examined as witnesses, and there was no evidence on behalf of the remaining 125, making the relief granted to them perverse.
HAL relied on Umadevi (2006) to contend that directing reinstatement and permanency would amount to a back-door entry, bypassing statutory recruitment rules applicable to HAL as a public sector undertaking.
HAL pointed out the absence of sanctioned vacancies and a recruitment ban circular dated 10 June 1989, arguing that the Labour Court ignored this reality.
HAL submitted that the burden to prove that workmen were not gainfully employed for award of backwages lay on the workmen themselves, and the Labour Court erred in placing the onus on the employer, especially when only two had stepped into the witness box.
Judgment Excerpts
The Union instituted Civil Appeal Nos.9332-9333 of 2010 before the Apex Court, which were allowed by the judgment and order dated 26th February 2016 and the judgment and order dated 25th June 2009 passed in LPA No. 84 of 2006 was set aside.
HAL is a public sector undertaking and recruitments at HAL are governed by its own Recruitment Rules and Policies.
The Labour Court has incorrectly stated the legal position that the onus is always upon the employer to prove that the workmen are not gainfully employed during the pendency of the proceedings.
Procedural History
Complaints (ULP) Nos. 35, 36, 44 and 45 of 1990 filed by Nashik Workers Union before Labour Court. Labour Court passed orders on 8 August 1994 and 8 July 1997 granting reinstatement and permanency. Industrial Court confirmed these orders. HAL filed Writ Petition No. 3562 of 1997 in Bombay High Court. Single Judge by judgment dated 2 March 2001 allowed the writ petition, setting aside the Labour Court/Industrial Court orders and directing HAL to offer regular appointments as vacancies arise. Union filed LPA No. 144 of 2002, HAL filed LPA No. 84 of 2006. Division Bench on 25 June 2009 allowed LPA No. 84 of 2006, holding Central Government was appropriate government and complaints not maintainable, and disposed of LPA No. 144 of 2002. Supreme Court in Civil Appeal Nos. 9332-9333 of 2010 on 26 February 2016 set aside the Division Bench order and remanded LPA No. 144 of 2002. Upon remand, both parties consented to hearing the main writ petition. Arguments heard on 15 October 2018; judgment reserved.
Acts & Sections
- Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971:
- Industrial Disputes Act, 1947: 2(s), 2(oo)(bb), 25F, 25N
- Code of Civil Procedure, 1908: Order 23 Rule 1
