# Union Carbide India Ltd. & Ors v. State Of U.P. & Ors

- **Citation:** (2016) 5 ILRA 1470
- **Court:** High Court of Judicature at Allahabad
- **Decided:** 2016-05-27
- **Bench:** Ritu Raj Awasthi
- **Source:** https://unisonlegal.in/judgment/allahabad-high-court/union-carbide-india-ltd-ors-v-state-of-u-p-ors-43777
- **Pages:** 15

## Text

_Characters 0–39,935 of 48,872. This is a partial read: ask again with offset=39935 for what follows._

1470 INDIAN LAW REPORTS ALLAHABAD SERIES
13. We have also come across similar situations in respect of several private societies etc.
whereat Government officials in their official capacity function as office bearers of such private
societies and bodies though by holding Government office they cannot be a part and parcel of a private
body to function in capacity of its office bearers etc. in a general way so as to confer a veiled status and
position to such private body.

14. If any member of All India Service governed by Rules, 1968 claims protection with regard
to his participation under Rule 13(2), compliance of rule in its entirety is mandatory and it has to be
examined, whether report contemplated in proviso (ii) to Rule 13(2) is being forwarded by such
Government servant regularly or not and, if not, what action has been taken by Competent Authorities in
these matters. Let an inquiry be made by Chief Secretary, Government of U.P., Lucknow in this regard
and appropriate action be taken against all erring officials.

15. Besides, State Goverment shall also issue a general direction across the State, directing all
Government Officials that they should not be part and parcel of managing bodies of private bodies like
non-government societies, trusts etc. in whatever capacity, contrary to the provisions of Rules, 1956. In
respect of members of All India Service, Chief Secretary shall examine matter and see in how many
cases where the matter is governed by Rule 13(2), previous sanction of Government has been obtained
and if there is a case of Rule 13(2)(d) or (e) of Rules, 1968, whether there is strict compliance of proviso
(ii) or not and would take appropriate action in the matter. Chief Secretary shall submit a report in this
regard within a period of six months from today.

16. So far as present writ petition is concerned, impugned order has been passed by Deputy
Collector in his dual capacity as Deputy Collector as well as Secretary of Society, hence such order
cannot sustain.

17. In the result, writ petition is allowed. Impugned orders dated 22.11.2001 and 04.02.2002 are
hereby quashed.

18. No costs.
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ORIGINAL JURISDICTION
CIVIL SIDE
DATED: LUCKNOW 27.05.2016

BEFORE

THE HON'BLE RITU RAJ AWASTHI, J.

Writ Petition/Service Single No.- 6176 Of 1983

Union Carbide India Ltd. & Ors. ...Petitioners
Versus
State Of U.P. & Ors. ...Respondents
5 All. Union Carbide India Ltd. & Ors. Vs State Of U.P. & Ors.

1471
Counsel for Petitioners:
J.N. Mathur, Ms. Aprajita Bansal

Counsel for Respondents:
C.S.C., R.K. Srivastava

Industrial Disputes Act, 1947 - Sections 4-K & 19(6) - Payment of Bonus Act, 1965 - Sections
11, 22 & 39 - Code of Civil Procedure, 1908 - Section 11 (principles of res judicata) - Statutory
canteen - Contract labour - Employer-employee relationship - Bonus - Subsequent reference
for different years - Maintainability - Finality of earlier award.

Writ petition challenging Industrial Tribunal's award granting bonus to canteen workers treating them as
employees of principal employer - Earlier adjudication between same parties for earlier years held canteen
workers to be employees of independent contractor and not of principal employer - Said award attained
finality after dismissal of writ petition - Subsequent references for later years raising identical dispute.

Held, principles of res judicata are applicable to industrial and labour adjudication, though CPC is not strictly
applicable - Award of Industrial Tribunal operates as a judicial pronouncement and binds parties unless set
aside by competent forum - Once issue of status of workmen and entitlement to bonus has been directly and
substantially decided between same parties, subsequent adjudication on same issue is barred - Mere change
of years does not constitute change of circumstances.

Held, Industrial Tribunal erred in ignoring binding earlier award and in re-adjudicating same issue contrary to
settled findings - Impugned award suffers from legal infirmity and perversity.

Held, workmen employed in statutory canteen through independent contractor do not ipso facto become
employees of principal employer - For such status, existence of employer-employee relationship must be
established - Earlier adjudication having conclusively held absence of such relationship, subsequent contrary
finding unsustainable.

Held, where contractor was independently registered, paid wages, exercised disciplinary control, granted
leave, paid PF and ESI, entered into settlements with workmen and ran canteen for other establishments also,
relationship of master and servant with principal employer not established.

Held, union which is no longer a recognised trade union and where workmen themselves are neither parties
before Tribunal nor impleaded before Court, lacks locus to espouse cause on their behalf.

Impugned award dated 30.08.1983 set aside - Writ petition allowed.

Case Listed

Workmen of the Straw Board Manufacturing Co. Ltd. Vs. Straw Board Manufacturing Co. Ltd.
General Manager (OSD), Bengal Nagpur Cotton Mills, Rajnandgaon Vs. Bharatlal and another
Balwant Rai Saluja Vs. AIR India Limited
Bhilwara Dugdh Utpadak Sahakari Sangh. Ltd. Vs. Vinod Kumar Sharma Dead by Lrs. And others
The Saraspur Mills. Co. Ltd. Vs. Ramanlal Chimanlal and others
M/s Poddar Mills Ltd. Vs. Bhagwan Singh and another
M/s Basti Sugar Mills Ltd. Vs. Ram Ujagar and others
M/s J.K. Cotton Spinning and Weaving Mills. Co. Ltd. Vs. The Labour Appellate Tribunal of India,
IIIrd Branch, Lucknow and others
1472 INDIAN LAW REPORTS ALLAHABAD SERIES
Singh Engineering Works (P) Ltd. Vs. Industrial Tribunal (I), Allahabad and others
Coates of India Ltd. Vs. Fourth Industrial Tribunal, West Bengal and others
Burn & Company, Calcutta Vs. Their Employees
Bombay Gas Co. Ltd. Vs. Jagannath Pandurng and Others
The Punjab Co-operative Bank Ltd. Vs. R.S. Bhatia (Dead) through L.Rs.
Pondicherry Khadi & Village Industries Board Vs. P. Kulothangan and another

(Delivered by Hon'ble Ritu Raj Awasthi, J.)

1. At the very outset, it is to be noted that the instant writ petition remained pending in the
High Court for the last approximately 35 years and it is one of the oldest cases in this jurisdiction.
After much persuasion, I was able to get the lawyers of both sides agree to argue the matter so that
it is decided finally on merit.

2. Heard Ms. Aprajita Bansal, learned counsel for the petitioners, learned Standing Counsel
for opposite parties no.1, 2 and 3 and Mr. R.K. Srivastava for opposite party no.4.

3. It is informed by learned counsel for the petitioners that the writ petition was dismissed
in default vide order dated 14.3.2016, against which she has preferred application for recall (C.M.
Application No. 32674 of 2016) within time.

4. The cause shown in the affidavit filed in support of the application is sufficient to recall
the order.

5. The application is allowed. The Order dated 14.3.2016 is hereby recalled. The writ
petition shall stand restored to its original number.

6. Now, with the consent of parties' counsel, I proceed to decide the case finally on merit.

7. The instant writ petition is directed against the award of respondent no.1, out of two
references made by the State Government under Section 4-K of the U.P. Industrial Disputes Act,
1947, read with Sections 22 and 39 of the Payment of Bonus Act, 1965 by notification dated
8.9.1981 and 27.8.1981. Two references were registered as Adjudication Case Nos.16 and 79 of
1981. The impugned award dated 30.8.1983 is annexed as Annexure-1 to the writ petition.

8. The petitioner no.1 is a Company, registered under the Companies Act, whereas the
petitioner no.2 is an industrial establishment owned by petitioner no.1 and is engaged in
manufacturing of flash lights which are marketed under the trade name 'Eveready' and other trade
marks. Under Section 46 of the Factories Act, 1948, it is obligatory on the part of the the occupier
of a factory wherein 250 or more employees are employed to maintain a canteen. Section 92 of the
Act makes the breach punishable. The petitioner no.1, therefore, was obligated by virtue of statute
to provide for a canteen within its premises and for the same he gave the contract to independent
contractors to provide canteen services to its employees.
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1473
9. As per given facts of the case, in 1970 contract was considered for running a canteen in
the premises and on 25.02.1970 it was awarded to one Mr. Louis Novascek. The terms and
conditions clearly recognizes Mr. Novascek as Contractor. In April 1975, Mr. Novascek went away
and his supervisor Mr. B.D. Singh was allowed to look after the canteen. On 08.11.1975 a fresh
contract was entered into with Mr. S.P. Yadav for running the canteen. The terms were identical to
that of Mr. Novascek. The responsibility of carrying out the requisite legal obligation including a
license was that of Mr. Yadav. In the year 1974, 1975, 1976 the demands of bonus by the
employees and canteen contractor were raised for the first time. The employees of the canteen
continued to demand bonus from the petitioner no.2 i.e. factory owner.

10. An Adjudication Case No.29 of 1980, for demand of bonus raised for the year 1974,
1975 and 1976, was preferred before the Industrial Tribunal. The employees of the canteen
contractor were represented by respondent no.4 i.e. Eveready Flash Light Karmchari Sangh,
Lucknow, whereas on the other side employer was represented by petitioner no.2. On 27.04.1981
the award was given in favour of the petitioner no.2 holding that the workmen of the canteen were
the employees of the contractor and not the employees of the company. The demand of bonus from
petitioner no.2 was rejected. The award was challenged by opposite party no.4 by means of Writ
Petition No.5120 (SS) of 1980. This writ petition was admitted vide order dated 18.5.1982. It was
dismissed for non-prosecution vide order dated 1.3.2005, however, on an application moved by the
petitioner it was restored to its original number vide order dated 22.5.2007. This writ petition was
again dismissed for want of prosecution vide order dated 14.3.2016. This time no application for
recall of order has been preferred by the petitioner till date. The paper book of Writ Petition
No.5120 (SS) of 1981 is connected with the instant writ petition. No application for recall of order
dated 14.3.2016 has been preferred, as such, the Writ Petition No.5120 (SS) of 1981 stands
dismissed.

11. In the year 1977 and 1978, the years in question, again a demand of bonus was raised
by the employees of the canteen contractor. Adjudication Case Nos.16 and 79 of 1981 on two
references made by the State Government, as noted above, were registered. The Industrial Disputes
Tribunal has allowed the adjudication case in favour of the employees holding that the employees
of the canteen are in fact the employees of the company, they are automatically entitled to the same
bonus as the other workmen of the company, namely 20 per cent of the wages being paid to the
various workmen. In other words, the bonus shall be in accordance with Section 11 of the Payment
of Bonus Act, 1965.

12. Learned counsel for the petitioner has basically raised her arguments mainly on two
grounds. Firstly, it is submitted that despite the fact that the parties were same, the dispute was
same, i.e. the demand for bonus by the employees of the canteen contractor from petitioner no.2,
treating themselves to be employees of petitioners, which has been rejected by the Industrial
Disputes Tribunal in Adjudication Case No.29 of 1980, however, by the impugned award the
Industrial Tribunal has grossly erred in holding that the employees of the canteen contractor were
in fact employees of the petitioner no.2 and hence entitled to get the bonus in the same terms as
admissible to the employees of the petitioner no.2.
1474 INDIAN LAW REPORTS ALLAHABAD SERIES
13. Submission is that Adjudication Case Nos.16 and 79 of 1981 were barred by principles
of res-judicata. The objection in this regard was raised before the learned Tribunal, however, the
Tribunal has failed to appreciate that the award passed in the previous Adjudication Case No.29 of
1980 by the learned Tribunal is a judicial pronouncement and acts as res-judicata in the subsequent
proceedings as expressed in the maxim "interest rei publicae ut sit finis litium".

14. It is vehemently contended by learned counsel for the petitioners that earlier dispute
was also raised by the workmen of canteen demanding bonus from the petitioner no.2. In that
dispute the learned Tribunal came to conclusion that the workmen were the employees of the
canteen contractors and not the employees of petitioner no.2 and hence demand for bonus was
rejected. In the demand for subsequent years the status of the employees was not changed in any
manner and the parties to the dispute were the same. The issue before the learned Tribunal was also
identical in nature and the facts and circumstances remained the same, as such, the findings
recorded by the learned Tribunal in the earlier Adjudication Case No.29 of 1980 were to be
followed until and unless they were upset by the higher Court. The Writ Petition No.5120 (SS) of
1981 preferred by opposite party no.4 in this regard has been dismissed and, as such, the findings
recorded by learned Tribunal have attained finality and are binding on the parties concerned. It is
submitted that the principles underlying in the rule of res-judicata, expressed in the maxim "interest
rei publicae ut sit finis litium" founded on sound public policy and is of a universal application.
One important consideration of the public policy is that the decision pronounced by the Courts of
competent jurisdiction should be final unless they are modified or reversed by appellate authorities
and the other principles that no one should made to face the same kind of litigation twice over
because such a process would be contrary to the consideration of fair play and justice. It is also
submitted that the learned Tribunal has wrongly interpreted that the judgment given in the case of
Workmen of the Straw Board Manufacturing Co. Ltd. Vs. Straw Board Manufacturing Co. Ltd.1
cited by the petitioner in their favour on the issue of the present proceedings being barred by
principles of res-judicata and came to conclusion that extremely technical considerations should not
be allowed to out-weight substantial justice to the parties in an industrial adjudication. The learned
Tribunal has failed to appreciate that the matter in dispute in the present adjudication had earlier
been directly and substantially in issue between the same parties and the same had been heard and
finally decided by the learned Tribunal and therefore the principles of res-judicata is fully attracted.

15. It is contended that the findings of learned Tribunal in this regard can rightly be said to
be on complete unsound and incorrect understanding of the same. Learned Tribunal has failed to
take into consideration that the terms of contract for running the canteen by the independent
contractor were identical in the year 1977-78 as in the earlier year 1974, 1975 and 1976 and the fact
that the contractor subsequently acquired a license under the Contract Labour (Regulation and
Abolition) Act which came into existence in 1970 which nowhere bars the application of principles
of res-judicata as the parties to the dispute and the nature and issue were identical and substantively
decided in an earlier adjudication.

16. Secondly, it has been argued by learned counsel for the petitioner that the finding of the
learned Industrial Tribunal that the employees of the canteen are not employees of the independent
5 All. Union Carbide India Ltd. & Ors. Vs State Of U.P. & Ors.

1475
contractor but of principal employer i.e. the petitioner no.2 is totally perverse and wrong. This issue
was also settled by the learned Industrial Tribunal previously in Adjudication Case No.29 of 1980.

17. Submission is that the contract for providing canteen service was a contract FOR
service and not OF service. The petitioner no.2 by virtue of statute under the Factories Act, 1948
was to provide for canteen within its factory premises, however, the liability of the principal
employer in this regard was very limited. It was not with respect to the workmen employed by the
independent contractor in the canteen. The workers employed by the contractor in the canteen do
not ipso facto becomes employee of the principal employer. Learned Industrial Tribunal has failed
to consider the following facts:-

1- That Sri S.P. Yadav proprietor of Sushil Catering Services was not only providing
canteen services in the premises of the Petitioner No.2, but also providing canteen services to other
example T.V. Centres, U.P. Agro, Sales Tax Office, United Bank at Lucknow.

2- That the canteen contractor was registered under the Shop and Commercial
Establishment Act, 1958. He had a license under the Contract Labour (Regulation and Abolition)
Act, 1970.

3- That the contractor is completely responsible for all conditions of service
including those of grant of leave, disciplinary action, termination, removal, dismissal etc. The
wages were paid directly by him to the workmen. A memorandum of settlement under section 4-F
of the Uttar pradesh Industrial Disputes Act, 1947 and Rules 4 and 5 of the Uttar Pradesh Industrial
Disputes Act, 1957 and conciliation was arrived at between Sushil Catering Services and all
employees working in the canteen run by the former. This settlement was with regard to the
revision in wages of the workmen employed in the canteen. This settles the fact that wages were
being paid by the canteen contractor to the employees appointed by him.

4- That the canteen contractor was the one who granted permission for leave to the
workmen employed by him in the canteen.

5- That the canteen contractor also paid the provident fund and ESI contribution to
the respective authorities. The code given is UP/1828. It is pertinent to state at this juncture that the
independent contractor had previously applied for a separate code other than that of the company
which is code no.21-1301-90, but the same was rejected, however later the canteen contractor was
given a separate code (UP/1828). It may be pointed out here that the said issue of having the same
code was never raised by the workmen before the Industrial Disputes Tribunal.

6- That for the subsequent years i.e. 1979, 1980, 1981 the contractor looking to his
profit had paid bonus to his employees working in the canteen. In reply to the said paragraph the
Respondent No.4 have said that the fact that bonus was paid for the subsequent years by the
character do not vitiate their claim for bonus for the year in question 1977-78, thereby admitting to
fact that bonus was paid in subsequent years by the canteen contractor.
1476 INDIAN LAW REPORTS ALLAHABAD SERIES

7- That it is also necessary to state that the Petitioner No.2 was also registered as
principal employer under the Contract Labour (Regulation and Abolition) Act, 1970.

8- That the terms of contract given in the contract between the canteen contractor
and the Petitioner No.2 are completely in tune with the conditions given in the Factories Act, 1948
and the Rules made thereunder. The canteen managing committee was functioning and was
consulted by the canteen contractor as provided in the Factories Rules. The contractor in the terms
of contract was required to comply with all necessary labour laws and was required to maintain
proper accounts. The canteen was managed and run by the contractor in accordance with the terms
set out in the contract.

18. In support of her submissions, learned counsel for the petitioner has relied on the
judgment of Hon'ble Apex Court in the case of (I) General Manager (OSD), Bengal Nagpur
Cotton Mills, Rajnandgaon Vs. Bharatlal and another2 and (II) Balwant Rai Saluja Vs. AIR
India Limited3 wherein the Hon'ble Supreme Court has held that for the workmen engaged by a
contractor to work in a statutory canteen of a factory to be called the employees of the factory, they
would need to satisfy the test of employer-employee relationship.

19. At the end, Ms. Aprajita Bansal, learned counsel for the petitioners has pointed out that
the petitioners have filed a supplementary affidavit, bringing on record the fact that the opposite
party no.4/Eveready Flash Light Karmchari Sangh, Lucknow, who is espousing the cause of the
canteen workmen is no more a recognized trade union of the workers in the petitioner-Company
and has no right to contest the case any more on behalf of the canteen workmen.

20. Dr. R.K. Srivastava, learned counsel for opposite party no.4, on the other hand,
contended that the question as to whether the references made by the State Government which have
been registered as Adjudication Case Nos. 16 and 79 of 1981 were barred by principles of resjudicata, has been considered by the learned Tribunal and the learned Tribunal while dealing with
the references has framed certain issues in this regard. Learned Tribunal considering the objections
raised by the petitioners has come to conclusion that although the principles of res-judicata applies
to labour and industrial disputes, however, the real character of the controversy between the parties
is the determining factor and in complex and modified human relations between labour and capital,
giving rise to diverse kinds of ruptures of varying manners, no cast from rule can be laid down.
Extremely technical considerations, usually invoked in civil proceedings, should not be allowed to
outweigh substantial justice to the parties in an industrial adjudication.

21. It is submitted that the learned Tribunal has rightly come to conclusion that in the given
facts the principle of res-judicata would not apply as firstly the earlier adjudication was for the
years 1974, 1975 and 1976, while present references are for the years 1977 and 1978, and secondly,
no evidence seems to have been produced, and if it was produced it has not been discussed as to
how the device of having a contractor to run the canteen which was nothing but a sort of
camouflage to conceal the status of the contractor and his real role in acting as a stooge of the
5 All. Union Carbide India Ltd. & Ors. Vs State Of U.P. & Ors.

1477
company to deprive the workmen of their rightful award was evolved by the employers. Learned
Tribunal has also come to conclusion that there existed employer-employee relationship, hence, the
provisions of Payment of Bonus Act, 1965 were fully attracted. All these facts of the case clearly
go to show that the contractor was not independent but an employee of the Company and getting
salary for his services.

22. It is submitted that in a number of decisions the Hon'ble Apex Court has consistently
held that the workmen engaged in a statutory canteen are employees of the principal employer and
very often employers are resorting to subterfuge by trying to show that their employees are in fact
the employees of contractor in order to overcome their liabilities under the labour laws. In support
of his submissions, learned counsel for opposite party no.4 has relied on the following judgments:-

(I). Bhilwara Dugdh Utpadak Sahakari Sangh. Ltd. Vs. Vinod Kumar Sharma
Dead by Lrs. And others4

(II). The Saraspur Mills. Co. Ltd. Vs. Ramanlal Chimanlal and others5

(III). M/s Poddar Mills Ltd. Vs. Bhagwan Singh and another6

(IV). M/s Basti Sugar Mills Ltd. Vs. Ram Ujagar and others7

(V). M/s J.K. Cotton Spinning and Weaving Mills. Co. Ltd. Vs. The Labour
Appellate Tribunal of India, IIIrd Branch, Lucknow and others8

(VI). Singh Engineering Works (P) Ltd. Vs. Industrial Tribunal (I), Allahabad and
others9

(VII). Coates of India Ltd. Vs. Fourth Industrial Tribunal, West Bengal and
others10

23. I have considered the submissions made by parties' counsel and gone through the
records.

24. First and foremost question for consideration is whether the dispute raised before the
Industrial Disputes Tribunal vide notification dated 8.9.1981 and 27.8.1981, registered as
Adjudication Case Nos.16 and 79 of 1981 was barred by principles of res-judicata.

25. It is the settled legal proposition that the principles of res-judicata would broadly be
applicable to an industrial and labour dispute. The principles of res-judicata has been discussed in
various judgments of the Hon'ble Apex court as well as this Court, from time to time. In the case of
Burn & Company, Calcutta Vs. Their Employees11, it was laid down by Hon'ble Apex Court that
the award of an Industrial Tribunal is intended to have a long term of operation and it can be
reopened under Section 19 (6) of Industrial Disputes Act, 1947 only when there has been a material
1478 INDIAN LAW REPORTS ALLAHABAD SERIES
change in the circumstances on which it was based. In the above mentioned case it has been
observed as under:-

"An award of an Industrial Tribunal is intended to have a long term of operation,
and can be reopened under s. 19(6) of the Industrial Disputes Act-XIV of 1947 only when there has
been a material change in the circumstances on which it was based.

To hold otherwise would be to defeat the two basic objects which all industrial
legislations have in view, namely, to ensure to the workmen, a fair return for their labour and to
prevent disputes between the employers and employees, so that production might not be affected
and the interests of the society might not suffer. That although the rule of res judicata as enacted by
s. 11 of the Code of Civil Procedure does not in terms apply to such an award, its underlying
principle which is founded on sound public policy and is of universal application must apply."

26. In the case of Workmen of the Straw Board Manufacturing Co. Ltd. Vs. Straw Board
Manufacturing Co. Ltd. (supra) the Hon'ble Supreme Court has observed in paragraphs 27 and 28
of the judgment as under:-

"27. It is now well established that, although the entire Civil Procedure Code is not
applicable to industrial adjudication, the principles of res judicata laid down under section 11 of
the Code of Civil Procedure, however, are applicable, wherever possible, for very good reasons.
This is so since multiplicity of litigation and agitation and re-agitation of the same dispute at issue
between the same employer and his employees will not be conducive to industrial peace which is
the principal object of all labour legislation bearing on industrial adjudication. But whether a
matter in dispute in a subsequent case had earlier been directly and substantially in issue between
the same parties and the same had been heard and finally decided by the Tribunal will be of
pertinent consideration and will have to be determined before holding in a particular case that the
principles of res judicata are attracted.

28. The learned counsel faced with the problem drew our attention to rule 18 of the
U.P. Industrial Tribunal and Labour Courts Rules of Procedure, 1967, which provides that after
the written statements and rejoinders, if any, of both the parties are filed and after examination of
parties, if any, the Industrial Tribunal or Labour Court may frame such other issues, if any, as may
arise from the pleadings. It is clear that these issues are framed by the Tribunal to assist in
adjudication. While it cannot be absolutely ruled out that in a given cases judicata, the heart of the
matter will always be : What was the substantial question that came up for decision in the earlier
proceedings ? Some additional issues may be framed in order to assist the Tribunal to better
appreciate the case of the parties with reference to the principal issue which has been referred to
far adjudication and on the basis of which, for example, as to whether it is an industrial dispute or
not, the jurisdiction of the Tribunal will have to be determined. The reasons for the decision in
connection with the adjudication of the principal issue which has been referred to for adjudication
and on the basis of res judicata. The earlier question at issue must be, relevant and germane in
determining the question of res judicata in the subsequent proceedings. The real character of the
5 All. Union Carbide India Ltd. & Ors. Vs State Of U.P. & Ors.

1479
controversy between the parties is the determining factor and in complex and manifold human
relations between labour and capital giving rise to diverse kinds of ruptures of varying nuances no
cast-iron rule can be laid down."

27. In the case of Bombay Gas Co. Ltd. Vs. Jagannath Pandurng and Others12, the
question of payment of overtime wages under the provisions of Section 18 (3) of Bombay Shops &
Establishments Act was under consideration. The Hon'ble Apex Court has held that the doctrine of
res-judicata is a wholesome one which is applicable not merely to matters governed by the
provisions of Code of Civil Procedure, but to all litigation. It proceeds on the principle that there
should be no unnecessary litigation and whatever claims and defences are open to the parties
should all be put forward at the same time provided no confusion is likely to arise by so putting
forward all such claims. Para 11 of the aforesaid judgment on reproduction reads as under:-

"11. The question however remains whether they are entitled to be paid overtime
wages under the provisions of s. 12(3) of the Bombay Shops & Establishments Act. That Act was in
force when the award under consideration was given. It is not correct to say that the workers are
entitled to overtime payment by virtue of an amendment made to the Act in 1970. The 1970
amendment had nothing to do with the right of payment of overtime wages. The contention on
behalf of the company is that the right to overtime wages based on any ground what soever should
he deemed to have been dealt with and rejected by the Tribunal which gave the award in 1 950.
Though the demand for overtime wages was in general terms it could have been or it ought to have
been supported either as one of the items of industrial dispute or as flowing from out of the
provisions of the Factories Act or flowing from the provisions of the Bombay Shops and
Establishments Act. It was the duty of the party making the demand, who tried to justify the
demand, to support it on any one of the alternative basis. They could not have been ignorant of the
provisions of the Bombay Shops & Establishments Act. (Incidentally, though in this case it seems to
have been conceded on behalf of the company that the workers are governed by the Bombay Shops
& Establishments Act, it is contended on behalf of the. company that the concession should be
deemed to have been made only for the purpose of this case and not for all purposes). It is further
contender that the demand for overtime were under the provisions of the Bombay Shops &
Establishments Act should be deemed to be barred on principles analogous to those of the
rejudicata. Reliance is placed upon the decision of this Court in Bombay Gas Co. v. Shridhar
Bhau(1). But in that case the question whether the workmen should get overtime wages in the same
way as the workmen governed by the Factories Act had been considered in the reference which
resulted in the award of 1953 and before the Tribunal it was conceded by the workmen that they
were not governed by the Factories Act and the claim for the same overtime wages as those
Payable to workers under the Factories Act was based on the ground that there was no reason for
any distinction between the two sets of workmen. It was. therefore, held that 'so long as the award
remains in force it must be held that these workmen are not governed by the Factories Act and are
not entitled to the benefits thereof'. In the present case also the question under the Factories Act
had been considered but not the question whether they are entitled to overtime wages under the
provisions of the Bombay Shops & Establishments Act. We consider that the workmen could and
ought to have raised the question that even if they were not entitled to claim overtime wages at the
1480 INDIAN LAW REPORTS ALLAHABAD SERIES
same rate as payable to workers governed by the Factories Act , they should at least be paid the
same rate as those payable to persons governed by the Bombay Shops & Establishments Act. The
workers neither put forward the contention that they were entitled to the benefit of the Bombay
Shops & Establishments Act nor even that on considerations similar to those applicable to the
persons governed by the Bombay Shops & Establishments Act they should also be paid overtime
wages under the provisions of that Act. Incidentally it shows that the question as to whether the
Bombay Shops & Establishments Act is applicable to those workmen has been raised for the first
time in these proceedings. The doctrine of res judicata is a wholesome one which is applicable not
merely to matters governed by the provisions of the Code of Civil Procedure but to all litigations. It
proceeds on the principle that there should be no unnecessary litigation and whatever claims and
defences are open to parties should all be put forward it the same time provided so confusion is
likely to arise by so putting forward all such claims. It was observed by this Court in Devilal Modi
v. Sales Tax Officer; (1965) 1 SCR 686: AIR 1965 SC 1150: (1965) 15 STC 303.

"The general principle underlying the doctrine of res judicata is ultimately based on
considerations of public policy. One important consideration of public policy is that the decisions
pronounced by courts of competent jurisdiction should be final, unless they are modified or
reversed by appellate authorities; and the other principle is that no one should be made to face the
same kind of litigation twice . over, because such a process would be contrary to considerations of
fair play and justice, vide: Daryao and Others v. The State of U.P & Others [1962 (1) SCR 574:
AIR 1961 SC 1457.

We are therefore of opinion that the question of overtime wages should be deemed to
have been dealt with and disposed of by the Tribunal on whatever the basis of the claim for
overtime wages may be."

28. In the case of The Punjab Co-operative Bank Ltd. Vs. R.S. Bhatia (Dead) through
L.Rs.13 it has been held that the issue which has been decided in the earlier proceedings in an
industrial dispute between the same parties, the said issue is barred by res-judicata. The para 5
judgment in this regard is reproduced hereinbelow:-

"5. The first point urged on behalf of the appellant is that the respondent was not a
workman within the meaning of the Act and that the Labour Court committed an error in saying
that there was no evidence led on this issue and resting its judgment on the principles of res
judicata on the basis of the decision of Shri Kaul in I.D. No. 66/1962. In our opinion the Labour
Court rightly applied the principles of res judicata to the issue whether the respondent was a
workman or not within the meaning of the Act. The same parties in I.D. No. 69/1962 joined issue
on the aforesaid question. A decision given by the competent Labour Court in that regard has
rightly been held as a bar on the principles of res judicata in the trial of the same issue in the
present proceeding. Moreover, we find that even apart from the previous order operating as res
judicata, practically there was no evidence on behalf of the appellant in support of its case that the
respondent was not a workman. The only evidence of M.W. 1 was that in his capacity as an
Accountant the respondent used to sign the salary bills of the staff including himself. But then he
5 All. Union Carbide India Ltd. & Ors. Vs State Of U.P. & Ors.

1481
further stated that these bills used to be submitted to the Head Office of the Bank. The accountant is
supposed to sign to the salary bills of the staff even while performing the duties of a clerk. That did
not make the respondents "employed mainly in a managerial or administrative capacity," within
the meaning of sub Clause (iii) of the Clause (s) of Section 2 of the Act. The witness further stated
that during the period of his accountancy as well as the managership (meaning thereby the
officiating managership) the respondent conducted himself as an officer and the Bank authorities
also treated him as such. There was no proof produced to show any entrustment of managerial or
administrative duty to the respondent while he was working as a more Accountant. In South Indian
Bank v. A.R. Chacko (194) 5 SCR 625 it has been pointed out at pages 631 and 632 that there are
Accountants in Banks who are really officers and there are other types of Accountants who are
merely senior clerks with supervisory duties. The respondent was merely a senior clerk doing
mainly clerical duties and had no duty assigned to him of a managerial or administrative nature. It
may further be added that relying upon the order of Shri Kaul the Labour Court held in the present
proceeding that the respondent was an officiating Manager and hence not a workman from
October 9, 1958 to April 4, 1961. The claim for that period has been disallowed in that ground
alone."

29. In the case of Pondicherry Khadi & Village Industries Board Vs. P. Kulothangan and
another14 the Hon'ble Apex Court has held that principles of res-judicata in industrial dispute are
applicable provided the court trying the subsequent proceeding is satisfied that the earlier court was
competent to dispose of the proceedings and the matter has been heard and finally decided. Paras
10 and 11 of the judgment are reproduced below:-

"10. In our opinion, the appellant has correctly contended that the industrial dispute
pertained to the same subject matter dealt with in the earlier writ proceedings and was barred by
the principles of res judicata. It is well established that although the entire Civil Procedure Code is
not applicable to industrial adjudication, the principles of res judicata laid down under Section 11
of the Code, are applicable1 including the principles of constructive res judicata. Thus in State of
U.P. v. Nawab Hussain2, it was held that the dismissal of a writ petition challenging disciplinary
proceedings on the ground that the charged officer had not been afforded reasonable opportunity
to meet the allegations against him, operated as res judicata in respect of the subsequent suit in
which the order of dismissal was challenged on the ground that it was incompetently passed. This
Court also held:

"....it may be that the same set of facts may give rise to two or more causes of action.
If in such a case a person is allowed to choose and sue upon one cause of action at one time and to
reserve the other for subsequent litigation, that would aggravate the burden of litigation. Courts
have therefore treated such a course of action as an abuse of its process.

11. The principle of res judicata operates on the Court. It is the Courts which are
prohibited from trying the issue which was directly and substantially in issue in the earlier
proceedings between the same parties, provided the Court trying the subsequent proceeding is
satisfied that the earlier court was competent to dispose of the earlier proceedings and that the
1482 INDIAN LAW REPORTS ALLAHABAD SERIES
matter had been heard and finally decided by such Court.