Supreme Court Remands Industrial Dispute for Fresh Hearing: Bundi Zila Petrol Pump Dealers Association vs. Sanyojak Bundi Zila Petrol Pump Mazdoor Sangh (2019)

Date of the Judgment: February 12, 2019

Citation: Not Available

Judges: Abhay Manohar Sapre, J., Dinesh Maheshwari, J.

Can an industrial dispute be fairly resolved if one party is not given a chance to present its side? The Supreme Court of India addressed this critical question in a case involving a dispute between a petrol pump dealers association and their workers’ union. The core issue revolved around an ex-parte award by the Industrial Tribunal, which the Supreme Court ultimately set aside, remanding the case for a fresh hearing. This judgment emphasizes the importance of natural justice and the right of all parties to be heard in any legal proceeding. The judgment was delivered by a two-judge bench consisting of Justice Abhay Manohar Sapre and Justice Dinesh Maheshwari.

Case Background

The dispute originated from a reference made by the State Government on July 26, 1989, under Section 10(1) of the Industrial Disputes Act, 1947, to the Industrial Tribunal, Kota. The reference concerned several demands raised by the Sanyojak Bundi Zila Petrol Pump Mazdoor Sangh (the Respondent) on behalf of the workmen against the Bundi Zila Petrol Pump Dealers Association (the Appellant). These demands included issues related to wages, leaves, holidays, job classifications, increments, dearness allowance, rent allowance, medical benefits, provident fund, education fees, and uniforms.

Timeline

Course of Proceedings

The Industrial Tribunal, Kota, issued an ex-parte award on July 31, 1995, in favor of the Respondent, as the Appellant did not appear despite notice. The Appellant, upon learning of the award, filed a writ petition in the High Court of Judicature for Rajasthan at Jaipur. A Single Judge of the High Court allowed the writ petition on September 10, 1997, setting aside the ex-parte award. Aggrieved, the Respondent filed a writ appeal before the Division Bench of the High Court. The Division Bench allowed the appeal on November 21, 2005, setting aside the Single Judge’s order. The Appellant’s review petition was also dismissed on April 10, 2007. The Appellant then filed a special leave appeal before the Supreme Court.

Legal Framework

The case primarily revolves around Section 10(1) of the Industrial Disputes Act, 1947, which empowers the State Government to refer industrial disputes to a Tribunal for adjudication. The section states:

“10. Reference of disputes to Boards, Courts or Tribunals.—(1) Where the appropriate Government is of opinion that any industrial dispute exists or is apprehended, it may at any time, by order in writing,—
(a) refer the dispute to a Board for promoting a settlement thereof; or
(b) refer any matter appearing to be connected with or relevant to the dispute, to a Court for inquiry; or
(c) refer the dispute or any matter appearing to be connected with, or relevant to, the dispute, if it relates to any matter specified in the Second Schedule, to a Labour Court for adjudication; or
(d) refer the dispute or any matter appearing to be connected with, or relevant to, the dispute, whether it relates to any matter specified in the Second Schedule or the Third Schedule, to a Tribunal for adjudication:”

Arguments

Appellant’s Submissions:

• The Appellant argued that they were not given a fair opportunity to contest the reference before the Industrial Tribunal.
• They contended that the ex-parte award was passed without their knowledge and that they had sufficient cause for their absence.
• The Appellant emphasized that they did not appear before the Tribunal from the beginning and were not deliberately absent after appearing.
• They asserted their right to contest the case on merits, as no exceptions applied to their case that would disentitle them from doing so.
• The Appellant argued that substantial justice required that they be given a chance to present their case.

Respondent’s Submissions:

• The Respondent contended that the Industrial Tribunal had rightly passed the award since the Appellant had failed to appear despite notice.
• The Respondent argued that the High Court was correct in upholding the Tribunal’s award.
• The Respondent submitted that there was no sufficient cause to set aside the ex-parte award.

Issues Framed by the Supreme Court

The Supreme Court did not explicitly frame specific issues but addressed the following key questions:

• Whether the appellant was given sufficient opportunity to contest the reference before the Industrial Tribunal?
• Whether the ex-parte award passed by the Industrial Tribunal should be set aside?
• Whether the matter should be remanded to the Industrial Tribunal for a fresh hearing?

Treatment of the Issue by the Court

Authorities

The Supreme Court did not cite any specific case laws or books in this judgment. The primary focus was on the principles of natural justice and the need for a fair hearing.

Judgment

How each authority was viewed by the Court?

The Court considered Section 10(1) of the Industrial Disputes Act, 1947, to understand the power of the State Government to refer industrial disputes to a Tribunal. The Court did not discuss any other authority.

What weighed in the mind of the Court?

The Supreme Court’s decision was primarily driven by the principles of natural justice and the need to ensure that all parties have a fair opportunity to present their case. The Court emphasized that the appellant was not given any opportunity to contest the reference before the Industrial Tribunal, and this lack of opportunity was a significant factor in their decision to set aside the ex-parte award and remand the case for a fresh hearing. The Court also highlighted the importance of substantial justice, stating that both parties to a dispute are entitled to an opportunity to contest the case on the merits.

The Court’s reasoning was based on the following points:

The Court stated:

• “First, it is not in dispute that the appellant did not get any opportunity to contest the reference before the Industrial Tribunal and had to suffer adverse award ex parte”
• “Fourth, every party to a lis has a right to contest the case on merits, of course, subject to certain well known exceptions provided in law.”
• “Lastly, substantial justice demands that having regard to the controversy, which is subject matter of reference, both the parties to the lis are entitled for an opportunity to contest the case on the merits.”

There were no minority opinions in this case.

Key Takeaways

• The judgment reinforces the principle of natural justice, emphasizing the right of all parties to be heard in legal proceedings.
• Ex-parte awards can be set aside if the affected party was not given a fair opportunity to present their case.
• Industrial disputes should be resolved on merits after giving both parties a chance to present their arguments and evidence.
• The Supreme Court’s decision ensures that matters are decided fairly and justly, preventing any party from being unfairly prejudiced.

Directions

The Supreme Court directed the following:

• The ex-parte award of the Industrial Tribunal was set aside.
• The case was remanded to the Industrial Tribunal for a fresh hearing.
• The appellant was granted an opportunity to file their written statement in answer to the statement filed by the respondent.
• Both parties were granted liberty to amend their respective statements, file documents, and lead oral evidence.
• The Industrial Tribunal was directed to decide the reference within six months from the date of the appearance of the parties.
• Parties were directed to appear before the Industrial Tribunal, Kota, on March 5, 2019.

Development of Law

The ratio decidendi of the case is that an ex-parte award by the Industrial Tribunal should be set aside and the matter remanded for a fresh hearing when the affected party was not given an opportunity to present its case. This is a reaffirmation of the principles of natural justice. There is no change in the previous position of law.

Conclusion

The Supreme Court’s decision in Bundi Zila Petrol Pump Dealers Association vs. Sanyojak Bundi Zila Petrol Pump Mazdoor Sangh underscores the importance of procedural fairness and the right to be heard in industrial disputes. By setting aside the ex-parte award and remanding the case, the Court ensured that both parties would have an opportunity to present their case on merits before the Industrial Tribunal. This judgment reinforces the principles of natural justice and fairness in legal proceedings.