Bank Employees Union vs Rajarshi Shahu Govt. Servants Co-Operative Bank Ltd., Kolhapur

REPORTABLE

IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 2328 OF 2021 [@ SPECIAL LEAVE PETITION (C) NO. 11668 OF 2016]

BANK EMPLOYEES UNION Appellant (s)

VERSUS

RAJARSHI SHAHU GOVT. SERVANTS CO-OPERATIVE BANK LTD., KOLHAPUR Respondent(s)

J U D G M E N T

R.F.NARIMAN, J.

1. Leave granted.

2. The short question that arises in this appeal is

as to whether the appellant – Registered Trade Union

- had locus to prefer an application to modify a

standing order that applies to the employees of the

respondent under Section 38(2) of The Maharashtra

Industrial Relations Act, 1946. The brief facts

necessary in order to dispose of this appeal are as

follows :-

The original standing order with which we are

concerned, and which stated the age of retirement of

the employees of the bank, reads as follows :-

“22(7) Every employee shall retire Signature Not Verified from service on attaining the age of Digitally signed by Jayant Kumar Arora Date: 2021.07.07 55 years, Extension not exceeding one 16:10:21 IST Reason:

year at a time or three years in all may be given at the discretion of the president.” 2

3. By two Agreements dated 11.01.2004 and 21.02.2010

which were settlements under Section 18(1) of the

Industrial Disputes Act entered into between the

respondent and its employees, it was agreed vide

Clause 16 of the 2004 settlement and Clause 15 of the

2010 settlement that the retirement age would now be

58 years. A reference was made under Section 73A of

The Bombay Industrial Relations Act (as it was then

styled) to the Industrial Court, which then made an

award in terms of the two settlements entered into.

This award was dated 10.03.2010. However, when it

was pointed out that formalities under the

Maharashtra Industrial Relations Act in modifying the

standing order 22(7) needed to be gone through in

order to implement the two settlements which

culminated in an award, the appellant – Registered

Union - filed an application on behalf of the

employees dated 26.04.2011 under Section 38(2) of the

said Act. Armed with the consent letter from various

other unions dated 04.09.2012, the application was

heard by the Additional Labour Commissioner. The

Additional Labour Commissioner, vide his order dated

25.10.2012, recorded as follows :-

“As the employees of the said Bank are also employed in other different 3

local areas of viz. Tasgaon, Kavathe Mahankal, Khanapur, Atpadi, Jath, Shirala, Walwa, Miraj, Palus, Kadegaon talukas and they are represented by Kolhapur District Bank Employees Union, Kolhapur which is the representative and approved union for Banking Industry for the abovesaid local areas, the said union’s views were obtained in accordance with the provisions of sec. 39 (1) of the Bombay Relations Act, 1946. The said union by their letter dated 04/09/2012 conveyed that they have no objection in the matter of settlement of alteration to the said Standing Order.

In accordance with the provisions of section 39 (1) of the Act, the management of the said Bank was requested to file their say in respect of the proposed alteration. The Bank by their communication dt. 19/03/2012 communicated their various objections objecting the union’s proposed alteration, but the management of the Bank could not refute the fact that they have made two settlements dated 11/01/2004 and 21/02/2010 wherein the management Bank has agreed to alter the retirement age of their employees from 55 to 58.

As both the parties i.e. the employees through their 4

representative unions, and also the management of the said Bank have

already mutually made the agreements to effect the change in retirement age, I find no difficulty to make the alteration to the Standing Order clause No. 22(7) which will read as under :-

Standing Order No. 22 (7) – Every employee shall retire from service on attaining the age of 58 years . Extension not exceeding one year at a time or three years in all may be given at the discretion of the President.”

4. However, an appeal was filed by the Bank in

November 2012 against the said order, in which

essentially one point was taken up, which was that

under Section 38(2) of the Maharashtra Industrial

Relations Act, only an employee, as defined under the

said Act, could apply to the Commissioner of Labour

for an alteration of a standing order and the

Registered Union, being separately defined, would

therefore have no locus to do the same. This appeal

was allowed by the Industrial Court, on a conspectus

of the provisions of the said Act, that the appellant

Union would have no locus to approach the

Commissioner of Labour under Section 38(2) of the

Maharashtra Industrial Relations Act, as only an 5

employee defined under the said Act would be allowed

to do so. In addition, the Industrial Court, being

troubled about the fact that, by its order, the bank

would be allowed to resile from the two settlements

entered into, the court’s conscience spoke out

thus :-

“10) No doubt, the Appellant Bank had executed an Agreement with the Opponent Union and in the said Agreement, it was decided to change the age of retirement from 55 years to 58 years. But, the Appellant Bank has made change in its Standing Orders by moving an application under Section 38(2) of The Bombay Industrial Relations Act, 1946. This act of the Appellant Bank shows the attitude of the Bank towards its employees. On the contrary, it was for the Appellant Bank to become a model employer by moving an application under Section 38(2) of the said Act for change in the age of retirement of its employees from 55 to 58 years and the same is not done. Undisputedly, the Agreement states about the change in the age of retirement that does not mean that the law has given right to the Union to file an application under Section 38(2) of The Bombay Industrial Relations Act, 1946.”

5. From this order, a writ petition was preferred by

the appellant. By the impugned Judgment dated 6

18.12.2014, after an exhaustive survey of the said

Act, it was found that the Industrial Court’s order

could not be interfered with, and, as a result, the

writ petition was dismissed.

6. Mr. Colin Gonsalves, learned senior counsel

appearing on behalf of the appellant, has taken us

through the provisions of the Act in copious detail

and has argued that on merits, his client would

certainly have locus, particularly given Section 27A

of the said Act, which has not been viewed by the

impugned Judgment in its correct perspective. In any

event, he added that it would be preposterous to

allow a party to a settlement, who, in fact, ratifies

the aforesaid settlement, to resile therefrom at a

stage of Ministerial implementation. He, therefore,

submitted that the appeal made against the learned

Additional Labour Commissioner’s order to the

Industrial Tribunal ought to have been dismissed on

the ground that since either the employer or the

employee, or both, could have gone to the

Commissioner of Labour to implement the two

settlements entered into, it would not lie in the

mouth of the employer to now turn around and take up

a technical plea of locus when the employer itself

could and should have approached the Labour

Commissioner under Section 38 to implement the two 7

settlements solemnly arrived at between the parties.

7. Sh. Vinay Navare, learned senior counsel

appearing on behalf of the Bank, supported the

Judgment of the Bombay High Court and took us in

copious detail through the provisions of the Act and

the standing orders. According to him, once it is

seen that the definition of ‘Employee’ and

“representative Union” is different, and once it is

also seen that under various other provisions of the

Act, more particularly Section 42, an ‘employee’ and

a ‘representative union’ have both been referred to

separately, as opposed to Section 38 which speaks

only of an ‘employee’, obviously a representative

union would have no locus to move an application

under Section 38, and the Judgment under appeal ought

not to be disturbed at all. He, however, makes a

submission that in case this Court were not to accept

his submission, the matter could be sent back to the

Commissioner of Labour for a reconsideration on

merits after adding one or more employees, so as to

take care of the technical objection taken.

8. After hearing both the learned senior counsel

appearing for the parties at length, we do not

propose to disturb the impugned Judgment on merits. 8

Having regard to the facts of this case, it is clear

that the original standing order which mandated 55

years as the age of retirement, was changed by

consent of both employer and employees, to 58 years,

not just once, but twice, by means of Settlements of

2004 and 2010, solemnly entered into under Section

18(1) of the Industrial Disputes Act. Not only this,

these settlements were also sanctified by an award of

the Industrial Court dated 10th March, 2010.

Ultimately, as correctly argued by Mr. Gonsalves, the

Ministerial duty of implementing the settlement was

on both the employer and the employees. It so

happened that the appellant moved an application

before the Commissioner of Labour. The said

application could and should have been joined in by

the employer, and in this backdrop, it would be clear

that any technical objection as to a registered union

having no locus to file an application under Section

38(2) of the said Act, cannot be countenanced. We,

therefore, set aside the order that has been passed

by the Industrial Court, which was only based on the

locus standi of the appellant, and hold that the

Industrial Court ought to have given some teeth to

Paragraph 10 of its own Judgment and held that the

very appeal which was filed before it be dismissed

for the very good reason that the bank should not be

allowed at the stage of implementation of two 9

settlements (culminating in an award) solemnly

entered into between itself and its employees, to now

turn around and question the locus standi of the

appellant. On this narrow ground, therefore, this

appeal is allowed and the Judgment of the Industrial

Court dated 14th March, 2013 and, consequently, the

judgment of the High Court is set aside. We

reiterate that we are not, in any manner, disturbing

the High Court Judgment on merits, leaving the

question of law decided by it open. All consequential

benefits, as a result of this Judgment, to the

employees of the respondent, be given within a period

of six months from today.

Pending interlocutory application(s), if any,

is/are disposed of.

.......................J. [ ROHINTON FALI NARIMAN ]

.......................J. [ K.M. JOSEPH ]

.......................J. [ B. R. GAVAI ]

New Delhi;

JULY 06, 2021.

10

ITEM NO.10 Court 2 (Video Conferencing) SECTION IX

S U P R E M E C O U R T O F I N D I A RECORD OF PROCEEDINGS

Petition(s) for Special Leave to Appeal (C) No(s). 11668/2016

(Arising out of impugned final judgment and order dated 18-12-2014 in WP No. 6558/2013 passed by the High Court Of Judicature At Bombay)

BANK EMPLOYEES UNION Petitioner(s)

VERSUS

RAJARSHI SHAHU GOVT. SERVANTS CO-OPERATIVE BANK LTD., KOLHAPUR Respondent(s)

Date : 06-07-2021 This petition was called on for hearing today.

CORAM : HON'BLE MR. JUSTICE ROHINTON FALI NARIMAN HON'BLE MR. JUSTICE K.M. JOSEPH HON'BLE MR. JUSTICE B.R. GAVAI

For Petitioner(s) Mr. Colin Gonsalves, Sr. Adv.

Ms. Jane Cox, Adv.

Ms. Aparna Bhat, AOR Ms. Karishma Maria, Adv.

For Respondent(s) Mr. Vinay Navare, Sr. Adv.

Ms. Gwen Karthika, Adv.

Ms. Abha R. Sharma, AOR

UPON hearing the counsel the Court made the following O R D E R

Leave granted.

The appeal is allowed in terms of the signed reportable

Judgment.

Pending interlocutory application(s), if any, is/are disposed

of.

(JAYANT KUMAR ARORA) (NISHA TRIPATHI) COURT MASTER BRANCH OFFICER

(Signed reportable Judgment is placed on the file) 11