A Division Bench of the Madras High Court, on July 13, 2020 in the matter of Royal Enfield Employees Union v. The Government of Tamil Nadu, had dealt with the issue of whether a probe into the evidence and facts relating to a settlement arrived under Section 12(3) of the Industrial Disputes Act, 1947 ("ID Act") ("Settlement"), could be undertaken under Article 226 of the Constitution of India ("Constitution"), or can be adjudicated as an 'industrial dispute' only by the Labour Court/Tribunal under the ID Act? 

Facts of the case: 

By an order dated July 8, 2019, the Learned Single Judge of the Madras High Court had held that a probe into the evidence and facts relating to the Settlement, as to whether the same is binding or not, or is fair and proper or not, cannot be an exercise which can be undertaken under Article 226 of the Constitution and can be adjudicated only by the Labour Court/Tribunal formed under the ID Act.   

It was the case of the appellant that the Settlement arrived between the appellant-union and the management-company, regarding a dispute relating to altering of the service conditions of workmen and increase in wages is questionable since the appellant was represented only by a minority group of the union and not the majority group of the union, before the Learned Conciliation Officer. 

Being aggrieved by the order of the Learned Single Judge of the Madras High Court, the appellant preferred the instant appeal. 

The appellant argued that in the event a settlement arrived under the ID Act is questionable, the same can only be taken up under Article 226 of the Constitution and cannot be termed as an 'industrial dispute' and referred for adjudication before the Labour Court/Tribunal. 

Decision of the court:

The Madras High Court examined the issue as to whether the dispute in question can be raised as an 'industrial dispute', in accordance with Section 2(k) of the ID Act, to which the court observed that an 'industrial dispute', inter-alia, means a dispute which is connected with the terms of employment and that a settlement arrived under the ID Act relates to the terms of employment of workmen including such other benefits that may have been arrived at and therefore, can be taken up for adjudication by the Labour Court/Tribunal. 

The Division Bench relied on the decision of Rajasthan State Road Transport Corporation v. Krishna Kant, (1995) 5 SCC 75, wherein the Supreme Court had inter alia held that "Where, however, the dispute involves recognition, observance or enforcement of any of the rights or obligations created by the Industrial Disputes Act, the only remedy is to approach the forums created by the said Act". 

The court further relied on the decision of U.P. State Bridge Corporation Limited v. U.P. Rajya Setu Nigam S. Karamchari Sangh, (2004) 4 SCC 268, wherein the Supreme Court had, inter-alia, held that "where a specific remedy is given by the statute, the person who insists upon such remedy can avail of the process as provided in that statute and in no other manner". 

Accordingly, in the instant case, the court upheld the view expressed by the Learned Single Judge that whether the Settlement is binding, whether the Settlement is fair and proper or not, and whether the Settlement can operate are all questions related to terms of employment of workmen, and for that an 'industrial dispute' can only be raised before the Labour Court/Tribunal. 

Please find a copy of the judgment here.

This update has been contributed by Arka Majumdar (Partner) and Avin Sarkar (Associate).