# "f WORKMEN OF.Mjs HINDUSTAN LEVER LTD. & ORS,. + • . --t·· v. MANAGEMENT OF M/S ttTNtius r AN LEVER LTD. BJanuary 5, 1984

- **Citation:** [1984] 2 S.C.R. 307
- **Court:** Supreme Court of India
- **Decided:** 1984
- **Bench:** D . .J\. DESAI:'O. CHl, Nnappa Reddy, A. Varadara;An
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/f-workmen-of-mjs-hindustan-lever-ltd-ors-t-v-management-of-m-s-tttntius-r-an-8541
- **Pages:** 26

## Headnote

Industrial Disputes Act 1947
..
. Industrial Dispitte-Jurisdiction oTindu~trial trlh1~nal~Deter11!i1,1ed fro1n the o.rdrr
of reference-:--Status o,f person 1iot qu~stior1e:J hy en1ployer-TNhunal whe.tlier entit_led
· C ·
1!!...f~'o !ll()fU decide· as a prelin1i11ary iSsue.
Concluded Agree1i1e11t betlt'een Ma1iage111e11t and U11ion-Manafreme11t acting
on· the. agl'een1ent for so1ne )-;ea.rs-Mm1agen1ent whethcir ··zater entitled to repudiate
ancl, disown dgreen1ent-Dlffere11ce between unilateral rep1_rdiation -and tennination ·
of agree1nent Indicqted.
lil[lustrial dispute.\:-:Adjudication pf-Con<;_ept of res judicata-Wh~th_er apj,li-.
ble.
The appeJlant-UniOri and the respondcnt-Gomi,any through their c·ommunications dated January .. 24, 1951, April 24, )957 and May .1, 1957 :concluded an.
agreen1ent relating to .various it~ms· of industrial disp~tes which inter.Olia ptovided
. that the en1ployer had agreed not to contest the issue-whether field foice including_
salesn1e11 were not '\vorkn1en' within .the meaning of the expressiop in the Tndti.strlal
DiSputes Act.and that disputes of an ·AH-India n~ture cotild be raised only at t>~lhi.
.
.
Two empioyees of the Respondent·con1pany who were· salesme.n and protected ·
workmCn with the meaning Of the expl·esSion ln the ·Tndustrial Disputes Act, 1947
and who• were office"· bearers of the union, were · cha·i·gci sheeted and ~fter a disCtpJinar.y enquiry their services ~ere terminated. .The appellant-union raised
an
industrial dispute-contending that the t~rmination of scrviCes of these two workn1en
were ille£a! and.iil"val.id, and that the enquiry was equally illegal,"and i~Propc!,.
and th"at the action of_ the. emp!Oyer ·w::i.s an act of reprisal. and victimiz3.tion,
Qecause of their trade union activities. The Government referred the' industrial
_ dispute tO the Indi1strial Tribu.naL
.
.
The e~ployer Contended. that the two Workn1en were not 'workmen' ·within
the rrieaning Of the exprCssion·in·the Act-and "that the Government had no jurisdiction to refer the dispute to the lndust-fiii.1 -T~ibunal. '1t was further co,ntCnded that·,
the s¢rvices of th~-wor,kme·n were tern1inated not by way of p'Unishn1ent but under
the contract of service and ihat the di"scip'linary enquiry \vhich was commenced
was ~~bsequently dropped.
·
·
,t
'
.
.
The -appellant-union- however conteitded that the employer wa~ estopped
from ~hall_cnging f~e status of the: two workplen \yitbin. the meaning of th'e expression
-
\
..
D
E
F
G
H
A
•·
B
c
D
E
F
G
H
308
SUPREME COURT REPORTS
(1984] 2 S.C.R.
in the A_ct on account of the subsisting, valid~ conc!Uded agreement between' the
parti_es and that in view of thC iward_ Of the lndμstria1 Tribunal, Delhi in 1.D. No.
46/66. The contentions about the existence of the agree·ment and the status of
salesmen 'were res judicOta and could nOt be reopened so 109g as the agr~ment
w~s in force and operative.
The Tribunal rejected the preliminary objections raised on behalf of the union
and came to the conclusion_ that the three communications dated January 24, 1957,
·.April 24; 1957 .. and May I, 1957 Ex. W-2, W-"· W-4 respectively did.not spell out
a coniplete, concluded -agreen1ent between the parties on the points mentioned
therein but it was art inchoate agreement in the stage of negotiations and the employer
waS not bound to stand by its Offer made in the communication dated January
24, 1957 · denYing itself the right to contest the status of .the field force including
salesn1en as not being workman within the meaning of the Act. The a\vard Of the
Industriai Tribunal, Delhi in I.D. No. 46(66 in which it. was held that there Was a
concluded agreement between the- parties and therefore the industrial disputes
raised therein could not be ·adjudicated at Delhi did not operate as .ra.s judicata
because the issue in that a\vard was not directly and .~ub~tantially in issue: in. the
present reference.' The Tribunal set dciwn the reference for·fufther hearing.
· Allowing the Ap~ea

## Text

_Characters 0–39,912 of 70,649. This is a partial read: ask again with offset=39912 for what follows._

··~
307
A
. "f
WORKMEN OF.Mjs HINDUSTAN LEVER LTD. & ORS,.
+
•
. --t··
v.
MANAGEMENT OF M/S ttTNtius r AN LEVER LTD.
BJanuary 5, 1984 .
[D . .J\. DESAI:'O. CHl,NNAPPA REDDY, AND. A. VARADARA;AN, JJ.]
Industrial Disputes Act 1947
..
. Industrial Dispitte-Jurisdiction oTindu~trial trlh1~nal~Deter11!i1,1ed fro1n the o.rdrr
of reference-:--Status o,f person 1iot qu~stior1e:J hy en1ployer-TNhunal whe.tlier entit_led
· C ·
1!!...f~'o !ll()fU decide· as a prelin1i11ary iSsue.
Concluded Agree1i1e11t betlt'een Ma1iage111e11t and U11ion-Manafreme11t acting
on· the. agl'een1ent for so1ne )-;ea.rs-Mm1agen1ent whethcir ··zater entitled to repudiate
ancl, disown dgreen1ent-Dlffere11ce between unilateral rep1_rdiation -and tennination ·
of agree1nent Indicqted.
lil[lustrial dispute.\:-:Adjudication pf-Con<;_ept of res judicata-Wh~th_er apj,li-.
ble.
The appeJlant-UniOri and the respondcnt-Gomi,any through their c·ommunications dated January .. 24, 1951, April 24, )957 and May .1, 1957 :concluded an.
agreen1ent relating to .various it~ms· of industrial disp~tes which inter.Olia ptovided
. that the en1ployer had agreed not to contest the issue-whether field foice including_
salesn1e11 were not '\vorkn1en' within .the meaning of the expressiop in the Tndti.strlal
DiSputes Act.and that disputes of an ·AH-India n~ture cotild be raised only at t>~lhi.
.
.
Two empioyees of the Respondent·con1pany who were· salesme.n and protected ·
workmCn with the meaning Of the expl·esSion ln the ·Tndustrial Disputes Act, 1947
and who• were office"· bearers of the union, were · cha·i·gci sheeted and ~fter a disCtpJinar.y enquiry their services ~ere terminated. .The appellant-union raised
an
industrial dispute-contending that the t~rmination of scrviCes of these two workn1en
were ille£a! and.iil"val.id, and that the enquiry was equally illegal,"and i~Propc!,.
and th"at the action of_ the. emp!Oyer ·w::i.s an act of reprisal. and victimiz3.tion,
Qecause of their trade union activities. The Government referred the' industrial
_ dispute tO the Indi1strial Tribu.naL
.
.
The e~ployer Contended. that the two Workn1en were not 'workmen' ·within
the rrieaning Of the exprCssion·in·the Act-and "that the Government had no jurisdiction to refer the dispute to the lndust-fiii.1 -T~ibunal. '1t was further co,ntCnded that·,
the s¢rvices of th~-wor,kme·n were tern1inated not by way of p'Unishn1ent but under
the contract of service and ihat the di"scip'linary enquiry \vhich was commenced
was ~~bsequently dropped.
·
·
,t
'
.
.
The -appellant-union- however conteitded that the employer wa~ estopped
from ~hall_cnging f~e status of the: two workplen \yitbin. the meaning of th'e expression
-
\
..
D
E
F
G
H
A
•·
B
c
D
E
F
G
H
308
SUPREME COURT REPORTS
(1984] 2 S.C.R.
in the A_ct on account of the subsisting, valid~ conc!Uded agreement between' the
parti_es and that in view of thC iward_ Of the lndμstria1 Tribunal, Delhi in 1.D. No.
46/66. The contentions about the existence of the agree·ment and the status of
salesmen 'were res judicOta and could nOt be reopened so 109g as the agr~ment
w~s in force and operative.
The Tribunal rejected the preliminary objections raised on behalf of the union
and came to the conclusion_ that the three communications dated January 24, 1957,
·.April 24; 1957 .. and May I, 1957 Ex. W-2, W-"· W-4 respectively did.not spell out
a coniplete, concluded -agreen1ent between the parties on the points mentioned
therein but it was art inchoate agreement in the stage of negotiations and the employer
waS not bound to stand by its Offer made in the communication dated January
24, 1957 · denYing itself the right to contest the status of .the field force including
salesn1en as not being workman within the meaning of the Act. The a\vard Of the
Industriai Tribunal, Delhi in I.D. No. 46(66 in which it. was held that there Was a
concluded agreement between the- parties and therefore the industrial disputes
raised therein could not be ·adjudicated at Delhi did not operate as .ra.s judicata
because the issue in that a\vard was not directly and .~ub~tantially in issue: in. the
present reference.' The Tribunal set dciwn the reference for·fufther hearing.
· Allowing the Ap~eal :
•
HELD : 1. The Tribunal committed a serious error, apparent on record
in holding that there was Ii.o concluded agreement between the parties as emerging
from Exs. W,2, W-3, and W-4. [329 F]
'
In .. the instant case, having meticUlously examined various refe~cnces pertaining to various industrial disputes ·between the parties at different centres in
:ni.ctia since· the agreement in 1957 it unquestionabiy emerges that the emPioycr till
the present reference never once even whispei:ed that 'the agteefnent was not. a
concluded agrOOffient or 'that it w.as an inChoate one left hanging at the s_tage of.
. "'negotiations. It ~as only in the. present reference the contention raised was that
the agreement was not a· concluded agreement.
The.employer which- swore by
the agreement and repeatedly succeeded in getting th~own out certain reference.s ·
at the threshold on account of the agreement contended tha'.t th_ere was no concluded
agrement, and. ignoring the whole history, the Tribun;r" fell into an eiior in accep:-
ting this contention. The Tribu'nal wholly ignored the fact that it was· ; solel)ln
agrement~ of. which effective" aand wholesome advantage had been taken by
the
employer and.when ii did not suit it; it wanted to turn round and not only repudiate
it but disown it.
No court of justice ~an ever permit s~ch a thing to be done.
[324 E-325 BJ
.
Hindustan Lever Ltd .. v. Ram Mohan Ray & Ors., (1973] 3 S.C.R. 624; JVestern
India Match Co. v. ·Their Workmen, [1964] 3 S.C.R. 560.at 566; and A(urniniu'!1
Factory Workers, Union v. Indian Aluminiton Co. Ltd.~ [i,962]]1 L.L.J. 210, referred.
to.
2.
The Tribun.al is directed to proceed to detern1ine the dispute on merits
without conCerning itself with the considef~tion of the question whether the concerned workmen were workmen w.ithin the meaning of the exp_ressiori under the
Act. [332 E]
3. ·-The concept.of .. compulsory adjudication of industrial disputes was
statutorily _ushered ifi. with a view to providing a. forum and comP.elling the parties
)
•
WORKMEN ·v. HINDUSTAN LEVER LTD.
309
to resort to the forun1 for arbitr~tion so as tp avoid collfrontation and.dislocati~n
in industry. A developing country like'·India can ill-afford dislocation in ~ndust~1al
production. Peace and harmony in industry an~ uninterrupted product~on being
the demands of the time, it was considered wise to arm the Government with pow~r
to con1pcl the parties to resort to arbitration and as a necessary coronary to ~void
corlfrontation and trial of strength, .which were co~sidered wasteful from national
and--public interest point of view.
A welfare State can ill-afford to Jook askance
at industrial unrest ~nd indUstri_al Q.isputes.' [326H-327B]
Dahyabhai Ronchhoddas Shah v. Jayanfilal Mohan/al., (1973} Lab. & Industrial
Cases 96.7 .referred to.
' 4.
The Act did. not confer till the introduction of. Chapters ·v-A and V-B,
any special or enforceable benefits On the workmen. The Act was designed ·to
provide a self-contained Code to compel the parties to resort to industrial arbitration- for the· ·resolution· .of existing or appreherided disputes without prescribing
statutory norms for varied and variega_ted industrial ielatiO.n, so that the forUms
created for resolution of disputes may ren1ain ·unhan1pered by any statutory control
and devise rational norrris keeping place with improved industrial relations reflectfiig
and imbibing socio-economic justice. If this is· the underlying object behind enactni.ent of the Act, the COurt by interpretative· process must strive to reduce the field
of conflict and expand· the area of agreeinent a:nd show its preference for upholding
agreements sanctified by ·mutuality· and conse~sus in larger publiC interest, namel.Y
to es~hew in"duStrial strife,· confrontation. and consequent· wastage .. [327 C-E]
5. It is inappropriate to usher in the. technical co.ncept of res judicata pervading the "field of civil ju~ticc "into t~e field of industrial arbitration. The principle
analogous to res judicata can be availed of to scuttle any attempt at raisi~g industrial
disputes repeatedly in defiance of .operative settlenients and awards. But this
highly technical concePt of·· civil justice may be Kept in precise confined limits in
the field o.f industrial arbitr<ition whi9h must as far as possible be kept:free from
such technicalities which thwart resolution of industrial disput~s. [326 D-G]
Shahdara {D_elhi) Saharanftur
Light Railway Co. Ltd .. v. · Shahdara (Delhi)
Saharanpui: ftailway Workers Union, (1969) 1 L.L.J. 734 at ·742; and Workmen
of Straw Board Manufacturing_ Co. Ltd. v. M/s Straw Boa1«d Mlinufacturing Co. Ltd.,
[1974] 3 S.C.R. 703 referred to.
6 .. Unilateral repudiation is .distin~i from terrriination and an agreement/
settleinttnt reniains in fOrcc and. binding till ·terminated and· does not come to .an
end by unilateral repuqiation. -[328 E]
In th~ inst~nt case; th~ parties enfered _intO a soi~~n agreement. It ~s not
suggested that the agreement has been tenninated. The only argument put forward
on behalf of the em))l~yer was that· .the union· has repu~iated the agreement by
raising disputes of an a11-India natu.re at a r~gional level .and thereby committed
·breach .. of the agreement. This. con_t6ntion is entirely without rnetits. What has
happe·ned.is ttiat the Union raised ceriain disputes whicl! according to the Union
were of a regional nature and which it was· not estopped from raising in the teeth
c;>f the tenns of the binding agreement behveen the parties. : On 'the Other b:ind,
·the employer contended that the disputes so raisCd were of an aJl-Jndia nature.
Both sides swore by the agreement,~the difference in approach being ·whether the
dispute was of an all-India na_turc _oi of regional nature.
Th~ divergence in approach.
A.
B
D
E
F
G
H
A.
B
c
D
E
F
G •
H
310
SUPREME COURT REPORTS
W~· as .to the ihterPretation, _the coverage; the.ambit and the width of th_e agre~h;ent'
Both th~ pa.rticS s~ore by the agrec1n€nt but differe"d in. their aPproach and· inter-.
prl:'.tation and the forun1 na1nely t,he Industrial Tribunai consisientlY upheid at tiW
instance of the e1nployer that there was a biJld_ing valid agreement subsisting between
the parties~ This. constitutes adherence· to agrecmcrit1 pcrfOrn1an.ce of th:;: agree~
ffient, implementation of the ·ag'ree1ncnt and being _bound by the agreement.
This
conduct in no sense c.1,n'be said tCrconstitti.te repudiation: [327 F-328 CJ
.
.
7.
The Tribun~l -derives_ its jurisdictin1i by the 9.rdc;. of reference and not
01_1.thc deteqninati<?O .. of a ju'risdictiOn.al·fact whipji i(ryii.1st of necessity decide t9 ~'.
acquir~ jurjsdiction. [330 G]
8.
In industrial adjudic~tfon, is;;ues are of two typ~s : (i) those- referred b:Y
tht .OOvernn1ent for adjudication a11d.s.:t Out in the order -of 'reference,' and (ii) incidental issues invol-ving miXod question<; of l11w and facts.
The Tribunal may fran1e.
preliminary iS~ues if the. point on which. Jhe parties,are at varia,~cc, go to the. foot
of the matter. But the -Tribunal cannot fraver beyond the ptCadings and aTrogate
~ tO ·itself the pchvor -to. raise· issues which the. ijarties to the· refern"e~ are precludf:d
fro111 raising.
If the e"n~plqyCr does not question the statu~ of the workmen, the
.Tribllnal callnot suo 1notu raise the· i~su~ 'ai1~ proceed to adjudicate Upon. the same
and throw out. the· reference ·on the sole ground that the Concerned workman was
not n workman·Withii-i-tp,e -n1:.!ani:ng or ~he ?xprcssion under thi;: Act. [33.l G'-332 Al.
9.· ·Whether a- p~rticular pcrs~n ··is a·· workn1an or· not depends -u·pan· factual
1natrix. ·Worktnan is ·d~fined in S0c. 2(s) ·of .the :Act. The ·ingn:dients and th~
irtddcnts of thC definition when 'satisfied, thC person
satisfy.ing. the sa1ne would.
be a \vorkman,
N~gativcly if son1cone fails "to sati<;fy one or oth~r ingredient or
·incident of the definition, -he-may not be.hpld to be workman witi~in the meaning
' of th~ exprcssi011 ln the A~t: [3.30 C]
.
. t 0 .. There is no provision in the A.ct. -which ob11ges the r ndtistria\ Tribui1al
or other forums sJt up _under the Act Ip d.;:cidc iVen in thG absence o(a :contention
froin the effip\oyer, a preliminary issue. w.heth_cr th_c per<;Oll· \Yh.o has_ invoked its .
ju'~isdiction is. <l work1nan or not. ··There is no- ·suc·h oblig.1tion cas~ sth.tutorily
on th0 Ti:i.bunal.
If the employci· ~Oc~. not raise the contention about the status
of.thC \Vorkm'.ln a.p.proaching the Tribunal, the Tribunal has no-obligation to decide
the Statμ:s· cif the person Whether he is a· workman or uot. The TribHnal inust
prbceed o'n the assrnnption ~hat n'o s\ich ·_conte.ntiqn ls _raised and is requirCd. to be
adjudicated upon. [J30 D-F]
·
CML APPELLATE JURISDJCTfON: ~ivil Appc2l Ne. 1865 of 1982
Appeal by Special leave . from the Order dated the ·24th
. Decembcr.'19.8.1 of the Labour Court, Delhi in LD. No. 120 of
i977 .
M.K Rammnuithi, · VP. Choudhmoy . Jifendra
Sharma
and
P. C,aur, for the Appellant.
· ·-·G.B.. Pai, 0.C. Mathui·, D.Nc Mishra, S. ·sukumaran and
Ms. Meera. Mathur; ·for the· Rcsp~ndent.
J
'
' l
WORKMEN v. HINDUSTA~ ~EVER L'rU. (Desai, J.)
.
.
.
.
.
.
.
311
.
j
'
.
.
.
The Judgment of the Court was delivered hy
DESAI, J .. Tf solemn agr_eelt)ents _proposed. by t11e employer.
and readily ac.ceeded. to by .the workmeio and holding:the forte for
over a· quarter· of a: century Ure crud~Jy .disowned .cofr1pelli:ig. the
workmen to knock at the door of the apex court for removing the
"roaJcblock in tJ1e access to justice set up by preliminary cbjectioi C'f
·iechnioal nature>, _industrial peace and harmony chanted" by
the
emplo~·er. \~ould be not merely an empty 1;1a11trl1 buf a· fliti!e (,xercise
df chasi,ng a mirage and unfortunately that i~ the ·sltuati('i1 here.
·
\'.:
.
.
.
·.
. .
. .
-. .
,;.
'
._Hindustan Lev.~r
L~d., _a
muhi:ri~itio~a! co1ripany, respo~dent
1 herein addressed a communication d'::ted January 24,_ 1957 1-ccordjng
the out-come· .. of mutual deliberaiiors betwcrn the .Hi1•dust211 Lever ·
Ltd_. {'employer'. for short) and.· the Hindust_an Levq' Mazdcor Sabha
;. ·uni-o-n' f Or' short) recognised repres~n"tativ- u1lion o_f. ·th~. \\'0rkn1cn
employed by _the employer.
The rckvan_t portion may be extrnct(d :
"Bx. W-2
24th January, 1957
_The Presidrnt,
Hindt)Stan Lever Mazdoor Sabha,
Bomloay,
Dear Sir; .
' .
•'
R~ferring~to: our rcCent 1neeting: abriut 'field force;- \ve \VOlfld
<:,c to p:ucc. on record that ~- · •
A
B
c
D
.!) . Wc."r~·:"ognise you as tJ:ic·· representjtive union. fo·r aJl
-F
s~ctiofis of fic19- fo~ce all over In.din.
'
2). · Yoll'-h,,tve agr~ed to tre<:1t_all 1nat'tcrs relating to \vages/•
sitlaries and ter-1ns and cdnditions cf $ervice ·on an ali·ITidia ·
basis· and not_ on· a regional haSi? as far as fi.efd forct is
c:_,nccrne'd. -
3f. For all -111atter~ of an .;ll~India natute re!nti1ig to field
force, you will communicate ivith ihe Pcrs~1'nel Director.
We hope that all such .matters will he scttkd by dircc_l
Megq!iatiOn hut.i.f at ony stage you decide to refer the
matlcr to conciliation, you will. po w only at Bombay.
W::., on our part, gi.ve you the assurance that if the 1naltcr
G
H
A
• B
c
E
F
·G
H
312
'
SUPREME COURT REPORTS
[1984) 2. S.C .. R:
is referred to a· Tribuna!"in llombay then its a\vard will
be applied by you to field force all.Dver India .. Fo~ thi~
!·eason, you wiH agree that it will be only proper for the
Tribunalto examine \he matter in an all India perspective.
.
.
.
,
4)"· Although we do not nnticipate. any problei11s of a.purely
local nature .. i~ cas.c such proble~s do arise· :;our rnem- ·.
bers vvill first try to arrive at a solution by approaching
· their own managers. and if this fails, your loeal Committee
should refer the matter to the local Commercial Manager
·nr Office Manage~. ·
·
.
•
5) . Foi future disputes. v~shall ·not coniest. issues about
field. force 911 the basis of t.hejr not ~being 'wo-r~mcn'
bLit shal! "contest issues only qn their 111erits in th.e same
way a_s wego !£ir other e91ployces.
·
Please.confirm that yo~1-agree.with the points menticined
above.
...
,
Yours faithfully,
Sd/- B.K. B;nd1ni"
. '
The union respondi:d ·to this con1n1unication· as
elated April 24, 1957 which reads as under :
per its letter
"nx: w.3 ·
. The Personnel· Manager>
Hindustan Lever Limited,
Seindia House,
R8lbrd Est.ate,
Bombay-];
D~ar·Sir,
•
24th April; 1957
With reference to your letter·Personn~l KSB/BN/49 dated
24.1.1957 and in the light of further discussions we had with
·you ori the subject. we would like. to sta1e as under :
J.
We thank you for recognising u; as the Representative
Union for all sections of the 'Field Force e11iployees all
ovei India.
• -~
\.
)
.
-
. {
+
~
•
---.i
~
•
WORKMEN'V. HINDUSTAN LEVER L'fD. (Desai, J.)
313
2.
We agree that certain major issues such as salary wages,
bonus,.provident fund, Gratuity, leave etc. will be treated
as far as nossible on an all-India basis.
. .
.
.
3.
We agree that for all matters -of an all-India. nature,
we will communicate with the Personnel Director. As
for the other points raised by i•ou, we agree to follow
the procedure. as far as legally permissible.
'
4.
Local matters, if .nol settled by negotiations, will have
to be ·dealt with otherwise.
For instance .. ihe Sabha
may go in for co_nciliation or may be free to resort to
.>iny other legitimate and/or peaceful method.
·
5.
We are indeed glad to note tha.t you will not contest
issues about fiel_d force on ·the basis of their n6t being
'Workmen' but you will contest issues only ·an their
n1erits in·the san1e \Vay 8-S you do for other emp{oyees-.
We ·wish to take the opportunity also to· confirm your
agreenlefit with us that {n. regard to ·deinal1ds relating ·
to Field Force contained in Rer. N.48 of "1956, now
p~niling adjuQicatie,Rtat Delhi, you will not•contest the
issue on the basis Of their not being 'Worl011{'1l' b'ut you
\viii contest the is.sue on the. n1crits of the dernands as_
you do for other cmpfoyces .
Yours faitlifully,
Sd/- J?, Pullat President
!st May, ,1957"
A
B
c
D
E
A further communicatiqn ensued from th"- employer dated
'
. May I, 1957. It is not necessary to reproduce the whole of it save
F
ahd cxc_ept that the e1nployer wanted .t~ be assured that the un.ion
by its communicaiio11 dated April 24, 1957 uneguivccally intended.
t'.) CJ;ifirm th:! iten1s of.agrceincnt relating to various iten1s 6f'indi1strial
disput~s b:!t\v~en the parties as set out in its con1municatjon dated·
JanLJary 24, 1957 ai1d .further sought clarification of _the two points
t\l~~d b); the uninn.
•
·
G
Tn~- ·substantial questio1_1 is vvhethcr there C-ft1:erged a ·concluded
ag.ree.n12nl between thC parties and binding on the parties till it is
t~rrr)inated accordin·g
to la\v? the question of the existence of a
c3nsluJ~d agrGemtnt a._1Hl its validity arises· iJi the folk)\ving·circumstances.
·
·
H
..
A
B
·.~
D
E
F
G
H
·•
. SUPREME COURT REl'OR\~
[1984] 2 s.c,R .
.Shri A.K', Sircar and Shri R.L. Gupta were protected workmen
'Pi thin. th~· meaning of the expression in the Industrial Dispute~··A<:t; ·
1947 ('Ac!' for short) and were admittedly the. office-bearers of the
miion a1id consequehtly leaders of the. workmen,. The employer
served_ a charge-sheet on.Shri A.K. Sfrcar on April JO, 1974 and on
the n·oxt•day. 'a charge-sheet. was served .on Shri R.T,. Gupta. ·There
.followed .a disciplinary enquiry and ultimately the services of Shri
A.K .. Sircar nd Shri R.L, Gupta were ierminated by the employer .
. The union raised an industrial dispute contending· that the termination
. of services of the afore'nlCiltioned. two w0rkmenwaS illegal and invalid
:and the ·enquiry was equally illegal and improper and that the acti.On
of the employer was an act of reprisal and victimization because.of
the trade-union .actiyities of the afor.ementioned two ·office-bearers
of the 'union. The appropriate Governfrlent referred the industrial
dispute to the Industrial Tribunal on July 16, )977.
Tl;e employer in its· written ~tatement. intet a/ia contended that .
Shrl .A.K. Sircar and Shri. R.L. Gupta .were iiot workmen within the ·
meaning of the expression in the Act and .therefore the appropriate
Government had nojurisdiction to refer the dispute to the Industrial
Tribunal and consequently-the Industi"il.Tribunol had ·no jurisdiction
to .hear and qeal' with 'the ref ereμ~~- .. _ It was ~urther -~on_tendCd t~at. in
a reference·between the employer and the union in ai1other dispute
to the Industrial Tribunal· in
Maharashtra· State, ·a contentio.n was
~als_ed-byJh~ en1Ploy~r tbat sJ!e~111f!Jl, off he el'nplcY.er.i~ not~ ~vor!(1~2n
·within the 1;1eaning or the expfes>ion .in the Act and• this objection
was upheld.by the Industrial.Tribunal and a petition for.special leave
against the decisbn of the Jqdu'str:a1 Tr<bunal to the Supreme Court
. waS' rejected
o~ O:tober l, 1975. ft' was furtl'er contended that'the
-. services of.: the af~)remenJioned · t\Vo _\vorktTien Were. terminated . not
by way of punishment. but under the co;llract of sorvice and the
dis-c;irlinary e11quify,_ WhiCh \VaS' conniienced earl:er \VOS slfbsequfntJy
dropped.
.~
,.
. ''?
•
·.·~
\
\tf
-
-
· The union in its counter-affidavit iiiter al/a co1itcnded that .the
,.
e;,,player '.was est0pped from chalhnging the ·Status 'of the fwo cQncerned workmen as not being \VCPknieo withfo the meaning of· the :ex- .
"pression in the Act on account of a subshting valid concluded agreement bet\Veeo the parties inter a/ia ]Yrovi(ling that the einploycr \Viii
. n~t· contest the issue about statu~ .of field force (which expression
includes salesman) on the basis of their not b~ing workmen but shall
contest the issue.only on the nieri'ts ill the same way as they .do for
other employees, It.· was also. contended that in view of Shri Roop,
+-
~··
~-
' ;
"
WORKMEN v. HINDUSTAN LbVER LTD. (Desai, J.)
315
.
.
...
.
Chandra· award ti1e ·is.sue about existence of ihe agreement and the
status of salesman· is res judicatq and cannot be reopend iill the agree~
n1cnt remains i1r force and operative.
.
. .
.
•
The rival pleadings led tci. the Industrial Tribunal framing the .
following issues :
·
·
.
.
.
•·
"l) Whether the management .is estopped from challenging
the status of these two concerned workmen as "workman'.
within the meaning ofthe Industrial Disputes Aet.
2) .Whether -the awar<! dated 17-11-66 of the Additional
Industrial Tribunal, Delhi wculd operate as res judicata
between the parties ?'
3) . lf issue No. I is answered int~e negative whether the
concerned (sic) are· 'workman' within :the meaning .of ·
· the I.D. Act ?
A
B
c
'4)
What is the effect of the order dated·.6-1-75 passed
D
by the ·l.T. Maharashtra. in reference 203 of 1973 and
order dated i.10.1975 of the Supre1m; Court in Petition
for special leave 1602 of .1975? -
5) · Whether the reference is incomp.etent and bad iri law
.for reasons mentioned in preL qbjections (III), (IV), (V) .·
· a11d (Vil) and (VIII) 1
Issue Nos. 1,2, 4·and 5 were directed to be he;ird as pre·
liminary issues. On Issue· No . .J, the Industrial Tribnrtal held that
the tht~e.communications.E~.W-2 ·ciated January 24, 1957, Ex. W-3.
'dated April 24, 1957 and Ex. W-4 dated May 1, 1?57 did not spell
out
a complete concluded agreement betw·een the parties on ihe
points set oμt therein but it \V.as· an inchoate agreement in the stage
of negotiations and therefore the· employer wa& not bound to stand
by its offer made in the comm,;nication dated January 24, 1957 deny-
,ing to itself' the right to contest the. status ·of the field force incfoding
salesman as not· being workman within the meaning of the expression
in the Aci. On Issue No. 2,.it was hied that the award of Shri Roop
Chandra in LD. No. 46 of 1966 in. which it was held that there was a
concluded agreement between the. parties· as disclosed· in Exs. W-2,
W·3 & W-4 and therefore 'the industri.al dispute therein 'raised could
not be adjudkated upon at Delhi, it being an AU-India ·dispute and
ought to have been rai$e<l at Bombay, did not:opei:ate as resjuqivata
E
F
G
H
..
•
. · ....
316
SUPREME COURl REfORlS
. [1984) 2 S.C.R·
A
because the issue in the award was not directly and s11bsta11tially in.
issue in the present reference.
Parties did not advance any argument
on Issues·Nos.-4 .and 5 anc\ tl1erefcire with reference to Issue No. 4,
.the Ttibunal observ~d that the same. may not be disposed of without
further hearii1g the parties and no findi.ng was recorded on Issue ·No, 5.
The Tribunal accordingly rejected the preliminary objectiorn raised
B
on behalf. of the union and set down the reference for further hearing.
c
D
E
F
G
H
Hence this• appeal by s·pecial. le~vc by the union.
.
. At the outset, we must xecord our unhappiness on the attitude
adopted by the employer in eon tending as late.as .1981 tha~ the three
commmiications ·Exs .. W-2, W-J and W-4 did ·not constitute a con-·
eluded agreement between the parties with respect to the points settled
.. therein and the Tribunal ignoing the ·l1istoi·y and repeated advantage
taken by the employer of this conclLided agreement . on numerous.
oc.casions accepted. the conte1ition of the employer. It is therefore
necessary first to point out how from 1957 till as' late as. 1966 ahd
even thereafter the employer non,suited the union, if that is a proper.
term, by .• setting up the .,very agrce1nent which now the employer
wants to. urge that it is11ot a concluded agreemeni. · The three impoi-
' tant clauses of the agreement ·emerging 'from the· correspondence
relevant to the present dispute are that (i) the Hindustan Lever
fyfozdoor Sabha was tecognised by tbe employer as a representative
union for all s~ctions. of field force all over lndia in the employinent
of the. employer and (ii) the union agreed to bring all matters relating
· . to wages/salaries and ·ter'rns and conditions o'r service on an All-India
basis and not·on regional basis as for as field force is concerned.and
(iii) that in future dispuics, the employer will not contest issue about
member of the field forc.e being workmen but shall contest issues
only on their .merits. in the same way as the employer would do for
other employees. Freed from technical jargon, the employer agreed
and undertook not to contest in any industrial dispute the status
of the field. force as not being workman witl1in the meaning of the
expression in the Act and that reference, if any, would M contested
on tl\e meri\s of the industi-ial dispute in respect of which reference
is made to the Industrial Tribunal. The out-tome of the agreement
would be that if a dispute of an all-India nature in respe~t of the field.
force . is raised at a regional level, foundi\lg its contention. on one of
the terms of the agreement, the employer would be in ·a position to get .
any regional reference rejected on the ground that there is a subsistil1g
valid agre.ement between the parties that such dispute .of an all-India
. nature in respect of the field force can.be· raised at Bombay only and
withiμ the jurisdiction of the Industr.ial Tribunal at Bombay only .
. '
'WORKMEN I'. HINDUSTAN LdER LTD. (Desai, J.)
. 3l7
.
There is no dispute between the parties that if't\1ere is_ an agreement
such would bo the out-come of it. This is not only not in dispute
but it is conceded 'that a settlement was arrived. at in respect of industrial
disputes between the enwloyer and the 11nion concerning the field
force including salesman in 1«15"1, 1959 and 1964: 'An averment to
this effect ·is made in Paragraph 'H' of the petition for special leave
· and Anx .5 was annexed to the petition which purports to be the settlernent dated December 22, 1964.. Jt is signed ·by Shd C.J. Mahimkar,
Joint Personnel Manager on . behalf of the employer and Shri
A.K. Basu; General -Secretary of the union at the relevant time. The
various industrial disputes 1n respect of which settlement is arrived at
were between the employer and the workmen of the. company who
were the members of the field fot'ce (salesmen, sales supervisors etc.)
employed in any part of India. This settlement was arrived at _under the
Industrial Disputes Act' and was registered according to the requirements 'of the Act. This implies ibat the status of the salesman as
· being workman within the meaning of the expression of the Act was
· not only not disputed but specifical)y conceded and that mtist obviously be pursuant to the subsisdng agreement. This is however an
inference so it is better now to move on to adjudication and award
by a forum with jurisdiction to decide the point.'
·
The Chief Commissioner of Delhi referred an.industrial dispute
whether workmen whose names were set out in the order of reference
l;Je paid compensation in addition to' the usual remuneratidn for the
period they had marketed Erasmic Blades and what directions were
necessary· in this behalf. The reference was between the employer
tl1e present respondent and the appelll~nt Union.
In this reference~ the workmen whD claimed ren1uneratiun \Vere
Delhi based salesmen of the employer. The_ employer appeared and
~ontested the reference. The only important contention raised on
behalf of the employer which must be 1ioticed reads as under :
'
"That the concerned workmen are members of the field
force of the company; .that the field force unit is a seperate
unit known as Field Force Unit; that they are liable to .be
transferred anywhere in India; that the Field Force Unit
is controlled by Company's Head Office .in Bombay; that it
wa'.< agreed between the .company and the Hindustan Lever
Mazdoor Sabha, Bombay that all matter.< relating to Field
Force Unit would be dealt ivi_th by both parties at Bombay
on all-India basis and_ if no settlement is reached; the dispute
A
B
c
D
F
G
H
A
(:.
'
D
F
. '
H
318
•
. SUPREME C~URT .R~PORTS
[l984J 2 s.c.R.
shall be raised in Bombay in accordan.ce with Industrial Disputes
Act; and. that any ,sett/emen.t or Award tl;erein 1vo1dd be m~de
app/icaO/e and sha// (>e bindilj[5 Oil a// members of the jiefd force
ail over. India." . (Emphasis supplied). .
.
The employer .. also contended. that i1f view of .the agreement
between· the parties, the dispute. referred to the Industrial Tribunal
regarding Hie field force could not be ;·aised at Delhi. It was also
contended ihat in view of the agreement subsisting betweeh.the paries,
the employe.i· had agreed not to contest the issue that its salesman
were .. not lv.orkmen within tlie meaning of the expression in the. A~t'.
. kfurthe·r contentlo;1 was. raise.ct that the union has committed breach .
of'the agreement by ri!ising t.he dispute at Delhi.
·
' The union while conceding that there was an agreement between
the parties as alleged w· the· employer contested the issue by·saying.
that.:the dispute was)1ot of an all-fodia nature as it was concerning
only some Delhi based .salesmen of the employer ·and therefore the
dispute was not .covered by the agreement.
·
.
.
The Industrial . Tribunal. (Shri Roop Chandra) 61\ the rival
contentions of the parties, raised the. following issues : .
. "I)
2)
"ISSUES
.. Is thei·e any agreement between tl1e 'Cqmpany a1id its
wo.rkme1i thi·ough ·the Hindustan Lever Mazdoor Sabha
that all maU~rs relating to· members of the :field force
• would be dealt with by .. both the parties in Bombay
ou a:n ail India basis and that if no settlement is reached,·
the dispute would be raised in Bombay.ii} accordance with
the Indnsti:ial Disputes Act ?
·
~
.
'
-
Doe.s the said agreement preve~1t the workmen in this
case from· raisi11g the dispute in Delhi ?
·3) · Are the einployees concerned not 'w.orkmen' ·within
the meaning of the term under tlie lndu~trial Disputes
Act? If so, has.the tribunal no juri~diction?
·
4) · Whether workmen have committed· a breach of. the
agreement' alleged to have been entered .into between
the. management and the μnion in 1957 and if so·, is the
.. ~
J
(
-1
.r
f·
.
.
.
WORK~1BN v .. HINDUSTAN LEVER LTD. (Desai, J.) .
319
•
-
.
l
management not entitled .!() rai.se. the pl.ea ·that the
salcs1nen .are not 'wofk1nen' within· the: meaning· of
Industrial Disputes Act ? "
It would thus appear at a gl!tnce that i( was the employer who
wanted the refe~ence t-0 be rejected on the preliminary objection .that
there was a valid subsisting c01icludecl agreement between the parties
: which had a direct bearing on the· industfi.al dispute involved in
the reference and that ·because• of the agrce1nent and as a 11ecessary
·corollary of. the agreement, the Tribunal had no · jurisdktion to
entertain. tlie dispute.
.
.
•
Now sec the out-coib.e of this contention o(the employer. On
Issue Nos. I and 2, Shri Roop Chandra as per bis a.ward dated November 17, 1966 held that in view of Exs. W-2, W-3 and W-4marked in
evide1ice_i11 the reference before him .~s Exs. M-1, M-2 and M-3 pro,
duced aμd .relied upon by- the mai\agement th~!. is the employer,
· t.he Industrial. Tribunal at Delhi would have no jurisdiction to·entertai11
it. It was never contended by the employer.beforeS·hri Roop Chandra
that the three documents did not end in a concluded agreement. On .
a contrary parties were ad idem that there was aconcluded agreement .
·between the parties. The difference was in their approach as to the
applicability of various clauses of agreement td the dispute raised in
the reference before the Tribunal., The employer contended that the
dispute was of an all-India. nature and therefore could not be raised
at Delhi. The union, on the ot.Jie·r ha11d, contended tha the dispute·
was of a regional nature ·concerning only 1.6 Delhi based salesme1i
of the Company and therefore the dispute could not be styled as an
·. all'lndia dispute.
·
.
.
.
The. Tribuna.1 lield .ih11t the dispute was of ari all-India nature,
related ·to the· duties and liabilities of all members of the .field force
employed all over India.and it involved su~h a major issue as salary
and.wages. Approaching the .matter from .this angle, the Tribunal
further held on the basis oLthe agreement, that the dispuie could
only be taken cognizance of at Bombay: The Tribunal .. was of the
· opinion that the agreement was valid and ·did not contravene Sec. 28
of the Indian C:ontra6t Act because where the parties .choose to h.ave
the matter entertained in one of the two or more courts having jurisdiction to e1itertain the matter, such an agreement does not· cont~avene
Sec. 28 .. The Tribunal further held that the agreement had the sanctity
. ofa 'contract and the parties must be held.to the c.ontract'. The Tribunal concluded by observing that the union was notjustified in raising
.
. .
.•
A
B
• c
D
E
F
G
H
A
.ft
•
c
D
E
F
G
H
320 ..
[1984] 2 s.c.R.
SUPREME.COURT REPORTS
the dispute. in. Delhi in vi;w ·of its agreement' with. the emp!o;er as
evidence by the three documents and that it is.not expedient in the
._ interest of justice and peace and harmony in industry that the Tribunal
should _adjudicate the matter of an all-India· nature. So saying the
Tribunal rejected the reference. The question is who took advantage
and benefit of the agreement? 'unquestionably, the employer who
· now decades after. successfully contending before another Tribuna)
that there was a valid and concluded agreement. wants to contend
that the three doeun:ients,Exs. W-1, W-2.and W-3do not spell out a
· concluded agreement but ail inchoate one which remained at foe
stage of negotiations only. Btil that is ·not the end .of th~ vacillation
~n the part of.the-employer.
·
Mr. Pai, learned counsel on. behalf ~f the employer on the "other
hand contended that" the union has expressly repudiated the agreement
8.iid th~r~fore, it is not open no\v ro the union to take r~course to the
. agreement. It was subniiiteil that if the union has committed a breach
. of the agreement, if there was· any, the employer is absolved from ..
observing or complying .with the. agteement. To substantiate thi&
submission,
our attention was invited to a reference made by the
Lt. Governor, Delhi to the Addl. Industrial Tribnnal constituted ·
for the Union Tt'1"ritory of Delhi; thcn·presided over.by Shri Hans Raj
for adjudication of the following. ,two issues :
···1.
whethor the deduction of leave" ·by tlie management for"
the year··I967 is illegai ·and/or unjustified and if so, to"
what relief are the affec1,ed wo1·kmen enti(led' and what
directions are necessary in this respect ?
2.
Whether .the management was obliged to grant. _special·
increment to all of its workineil. in .Delhi Branch and
if so, to what relief the affected workmen are 'entitled·
and what directions are necessary in this 1:espect ?"
The. union filed a statement of claim and sulisequently filed an"
additionai or amended written statement in which inte1· alia it was.
.-contended- 'that the .workmen of the concern "throughout India were
agitated becasue of this measure .and its wholly illegal implementation
. and the applicant Sabha led the opposition of the scheme and the
resistence of the workmen to it.' This averment was relied npon to
urge that the unlon ·raised a dispute of ail all-India nature at Delhi·
which was the regional centre .und this would imply intentional breac.h
or repudiation of the a~reeinent. Before we examine !his contention,
•
'-j..·
,
-~
· WORKMEN v. HINDUSTAN. LEVER LTD. (Desai, J.)
321
it is. necessary to refer to p'ara IO of the amended st(ttement of claim
in \vhich the union states·as under :
·
"That th.e binding nat~re of the agreement has been·
flagrantly flou<ed by the Management and. the very basis of
collective bargaining for industrial peace ha; been attac)<ed.":
This would show that the unioi1 .accused the employer of breach·
of agreement. On the. other hand, the employer in its written state-·
mcnt contended as under : ·
,. "No claim on behalf of the employees of the Field Force
ca'il .be taken up by Hind\1sta1i Lever Mazdoor Sabha, Delhi
·Centre and this Hon'ble Tribunal has no jurisdiction to
entertain the same in view of an agreement arrived ai and
between the. Company and the Hindustan Lever Mazdoor Sabha
in )957."
(emphasis supplied)
·
·
It would be crystai clear that the employer wanted the reference
to be rejected· at the threshold on the preliminary objection that in
·view of the concluded binding agreement betwee11 the parties, the·
dispute referred to for adjudication being of an all-India nature,' the
. union was precluded from raising lne same at a regional level and
the Tribunal had no jurisdiction to entertain the same. Apart frem
the extracted specific contention i11 paragraphs 5 and 6, the contentio1i·
is· elaborated by the employer and it was specifically contended that
in the award ·dated Nov. 17,
1966 by Sh;i Roop Chandra, Addi.
Industrial Tribunal, Delhi, it' was held that a valid agreeme1it was in
existence between the parties and no dispute pertainfog to the members
of the Field Force can be raised anywhere except in the State of
Maharashtra. It was further contended that the award of Shri Ro-0p ·
Chandra was confirmed by the High Court of Delhi by summarily
dismissing the Writ Petition No. 1163/67 filed by the union against the
award and when the union approached the Supreme Court in Appeal
. No. 42/68, the same was rejected thereby affirming the ·existence and
: binding character of the agreement.. These assertions by the employer
,.
fiow from the ple. ad.ings. To. revert to the. narration, Shri Hans .Raj .
proceed on leave and then retired and when a new Presiding Officer
• was appointed, the reference with one application: filed by the union
to summon certain documents ca!Jle up before. the Tribunal. . 'By a
laconic order, unsupported by any. reasoning, the Tribunal observed
that the salesmen are not w-0rkmen and so the documents neeu not
be .summoned.