Scope of Section 17B of the Industrial Disputes Act 1947

Ridhima Mehrotra & Deborshi Sarkar are third-year students at Symbiosis International (Deemed) University.

Introduction

Section 17B of the Industrial Disputes Act 1947 [“the Act”] states that upon an award of a Tribunal, National Tribunal or Labour Court reinstating a workman if the employer prefers appealing against such an order in a high court or the Supreme Court [“SC”], the employer by this provision would be liable to pay such workman full wages last drawn by such workman, inclusive of any admissible allowance. This entitlement for the workman is however subjected to the prerequisite that the workman during this period had not been receiving adequate remuneration from any other source of employment. The issue of being employed and receiving sufficient remuneration had been adequately clarified by the SC in the matter of Kaivalyadham Employee Association v. Kaivalyadham S.M.Y.M. Samity as being gainfully employed. The court went on to hold that petty labour would not suffice as being employed under Section 17B as it is neither a regular job nor is the workman in receipt of adequate remuneration. Section 12 of the Act precisely delegates the Conciliation Officer [“CO”] specific duties including holding conciliation proceedings. The CO primarily makes efforts to resolve the dispute between the workmen and the management. In the same light, under Section 33(5) of the Act besides other statutory authorities, the CO too has been entrusted with the duty to either grant or refuse an application for requisite approval of an action under Section 33(2)(b) of the Act. Section 33(2)(b), inter alia, states that during the pendency of a suit of an industrial dispute before an authority, the employer cannot discharge or dismiss a workman unless he has been paid wages for one month besides approval of the same action under Section 33(5) of the same Act. The same was held in Jaipur Zila Sahakari Bhoomi Vikas Bank Ltd. v. Ram Gopal Sharma. The rejection of such an application under Section 33(5) raises a valid question pertaining to whether the rejection of the application itself reinstates the workman and thereby fulfilling one of the requirements for Section 17B. A plethora of judgments, putting an end to the dispute, have cynically opined that under Section 33(5) it is not open to the conciliation officer to adjudicate whether the order proposed to be passed by the employer is proper or adequate. The authors through this article would attempt at a ratiocination pertaining to the order of a CO Section 33(5), not sufficing the preconditions laid down under Section 17B of the Act.

Award and Adjudication

A number of reasons abound an order passed by a CO under Section 33(5) not fulfilling the requirements under Section 17(B). Upon a bare reading of the provision, the imperative requirements of the provision as also laid down in the case of Anvarkhan Ghafurkhan Pathan v. Transport Manager are evident. They include an award to be given by the Labour Court, tribunal and National Tribunal and secondly the award must pertain to the reinstatement of the worker. However, an order as given by the CO under Section 33(5) cannot be equated with an award passed. Incorporating such an order under the ambit of an award as defined in this enactment would directly infringe the rules of statutory interpretation as there is evidently no scope of interpretation in a provision that lacks ambiguity. It has also been clarified in the case of Westinghouse Saxby Farmer v. State of W.B. [“Westinghouse Saxby”], where the Calcutta High Court held that if the purpose of the legislature was to treat an order under Section 33(5) as an award, it would have been expressly mentioned in the statute.

Further, the interpretation of ‘award’ gains specific significance due to its statutory presence in the form of Section 2(b) of the Act. Section 2(b) defines ‘award’ as an interim or final determination of an industrial dispute and is thereby indicative towards adjudication. The term “determination” as contemplated by the provision clearly states adjudication or a question or issue of an industrial dispute being considered on its merits. However, an order disapproving the actions under Section 33(2)(b) cannot be treated as “determination” of an issue involved in an industrial dispute. Considering the limited jurisdiction of the CO under Section 33(5) it has been clarified by the Karnataka High Court in the case of The Management of the Bangalore Woolen Cotton and Silk Mills Co. Ltd. v. The State of Mysore and Ors that there is no scope of adjudication or the final determination of the justness of the order of dismissal under Section 33(5). A CO under Section 33(5) dealing with an application for approval has limited jurisdiction. As was held in N.M. Desai v. Testeels, upon the establishment of the fact that the employer before dismissal of the workman, had held a proper enquiry thereby not resulting in any victimisation or unfair labour practice, the CO under Section 33(5) has to limit his enquiry only to the question as to whether a prima facie case has been made out or not. The CO does not need to determine the correctness and adequacy of the proposed order but rather grant the permission or refusal of the proposed action to be taken under Section 33(2)(b). A similar view has been given under the catena of judgments where the courts have explained the scope of adjudication of the CO in the whole Act. In the case of Automobile Products of India Ltd. & Ors. v.Rukmaji Bala and Ors, the SC clarified that the legislature never had the intention of conferring to the CO, under Section 33(5) the jurisdiction and power of adjudicating upon disputes which they normally do not possess and that the CO was not competent or qualified to exercise such power.

Reinstatement

Another salient requirement for granting relief under Section 17B of the Act is that the award passed by the authorities must direct reinstatement. An award as mentioned in Section 17B of the Act must direct reinstatement. The genesis of the issue of reinstatement lies in the language of Section 33(1)(b) and 33(2)(b). As pointed out by the Calcutta High Court in the Westinghouse Saxby case, in Section 31(1)(b), the master’s common law right to dismiss the workman on reasonable cause is subject to a ban. Under this Section, the employer post enquiry is stopped from dismissing the workman pending permission of the tribunal. Relying on the SC’s decision in the case of The Management of Hotel Imperial v. Hotel Workers’ Union, it can be stated that pending the removal of the ban on removal of the workman under Section 33(1)(b), the employer only has the right to temporarily suspend the employee, and upon granting of permission, the employer may then discharge the workman. However, in Section 33(2)(b), the employer can dismiss the workman but is later subjected to approval under Section 33(5). Nevertheless, the issue to be considered is whether an order under Section 33(5) rejecting an application made under Section 33(2)(b) can be equated with reinstatement.

Drawing an inference from a number of rulings on the present issue, it is safe to infer that an order under Section 33(5) cannot be said to have reinstated a workman. In Dalmia Cement v Regional Labour Commissioner, the Madras High Court pointed out that granting and refusing approval to Section 33(2)(b) did not fall within the province of directing reinstatement along with back wages. A similar view was taken in the case of G.K. Sengupta v Hindustan Construction where the SC stated that discharge of the workman shall be inoperative if approval to the order of dismissal is made under Section 33(2)(b) was not granted. The Court further stated that the employee concerned shall be deemed to be in service since the day of dismissal. In the case of Tata Iron v Modak, the SC held that an order of reinstatement following an order passed under Section 33(5) was not necessary as by the very action of the disapproval, the dismissal or discharge of the workman is of no effect and the workman concerned continues to be in service as if there never was any dismissal or discharge by the employer. Thereby, the fact that the rejection of the application made under Section 33(5) completely invalidates the order of removal thereby resulting in the workman never having been dismissed in the first place, rules out the requirement of an order of reinstatement.

Conclusion

In view of the foregoing discussion, it can be concluded that an order passed by the CO under Section 33(2)(b) does not fulfill the requirement laid down in Section 17B, and therefore no relief can be granted to the employee. However, an employee can invoke Section 10 of the Act under which he can raise an industrial dispute before the competent adjudicatory body if he is aggrieved by the approval order passed by the CO under Section 33(2)(b).