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Heena Restaurant And Bar And Ors. vs Madhukar M. Dewadiga And Ors. on 26 February, 2002

Bombay High Court
Heena Restaurant And Bar And Ors. vs Madhukar M. Dewadiga And Ors. on 26 February, 2002
Equivalent citations: 2002 (3) BomCR 471, 2002 (94) FLR 292
Author: N Mhatre
Bench: N Mhatre


JUDGMENT

Nishita Mhatre, J.

1. By this petition, the petitioners have challenged the ex parte order of the Labour Court in an application filed under section 33-C(2) of the Industrial Disputes Act as well as the orders refusing to grant unconditional stay of the ex parte order and the recovery certificate issued pursuant thereto.

2. The facts giving rise to the present petition are as follows :

Petitioner No. 1 is a Restaurant and Bar being run by petitioner Nos. 2 and 3, who are its partners. The respondents, who are the workmen employed with the petitioners, filed an application under section 33-C(2) of the Industrial Disputes Act (hereinafter referred to as ‘the Act’) on 21-10-1999 claiming minimum wages, overtime, wages for the weekly-off, leave wages and bonus. Calculations of the amounts claimed had been filed alongwith the application filed by the respondent-workmen individually. It appears that although the petitioners were served through the bailiff, the petitioners refused to accept the service. The Labour Court, therefore, on 17-6-2000 directed the matter to proceed ex parte and by an order dated 20-9-2000, the Labour Court held by a common judgment that all the respondent-workmen were entitled to amounts claimed by them. The petitioners were further directed to pay costs of Rs. 1,000/- to each of the workman. The Labour Court has observed that after the petitioners refused service through the bailiff, notices were sent to the petitioners under certificate of posting. However, the petitioners did not bother to attend the Court and resist the claim of the respondent-workmen and therefore, the Labour Court allowed the applications filed by the respondent-workmen.

3. As the amounts were not paid by the petitioners, a Certificate for Recovery was issued on 26-2-2001 under section 33-C(4) of the Act certifying that a sum of Rs. 6,37,162/- plus Rs. 1,000/- to each workman was due and payable to respondent-workmen. On 28-2-2001, the petitioners received a copy of the certificate issued for recovery of the amounts of Rs. 6,37,162/- as arrears of land revenue. The petitioners obtained a copy of the order of the Labour Court passed in the application under section 33-C(2) of the Act and thereafter on 19-3-2001 filed one application for setting aside the ex parte order and for restoration of the five applications filed by the respondent-workmen. An application for stay of the certificate issued on 26-2-2001 and the ex parte order was also filed by the petitioners together with an affidavit in support. The respondent-workmen filed their affidavit objecting to any relief being granted to the petitioners. On 10-5-2001, the Labour Court, after hearing the parties, allowed the stay application on condition that the petitioners deposit in Court an amount of Rs. 3,18,581/- that is, 50% of the amount awarded together with the costs awarded to each of the respondent-workmen. The petitioners did not bother to comply with this order of the Labour Court and instead, filed another application on 18-6-2001 for modification of the order passed on 10-5-2001 by the Labour Court. However, the Labour Court refused to modify the order and dismissed the application. In the meantime, the Collector had already issued notice for recovery of Rs. 6,37,164/- as arrears of land revenue. The petitioners, therefore, having failed in their attempt to evade payment of the dues to the workmen, approached this Court under Article 226 of the Constitution of India by filing the present petition on 1-8-2001.

4. The contention raised on behalf of the petitioners is that the Labour Court had no jurisdiction to impose any condition for setting aside the ex parte orders either under Rule 26(2) of the Industrial Disputes (Bombay) Rules or under the provisions of the Civil Procedure Code. It is submitted that since service was not effected in accordance with the Order 5, Rules 17, 19 and 20, the Labour Court ought to have set aside the ex parte order. It is also submitted that Order 9, Rule 13 being applicable to the proceedings before the Labour Court, no condition could have been imposed by the Labour Court for setting aside the ex parte order or for granting stay of the Recovery Certificate. Reliance is placed on the judgments of the Apex Court in the cases of Satnam Verma v. Union of India, ; State Bank of India v. Ram Chandra Dubey & others, A.I.R. 2000 S.C. 3734 and Bongaigaon Refinery & Petrochemicals Ltd. v. Samijuddin Ahmed, in support of these submissions.

5. The application which the Labour Court decided on 10-5-2001 was the application for stay of the certificate issued by the Assistant Commissioner of Labour on 26-2-2001 under section 33-C(4) of the Act and not the main restoration application as submitted on behalf of the petitioners. The Labour Court was well within its jurisdiction as well as the powers vested in it to stay of the recovery proceedings subject to certain terms and conditions. The submission that the provisions of the Civil Procedure Code apply in toto cannot be accepted. It is true that certain provisions of the Civil Procedure Code are made applicable to the proceedings conducted before the Labour Court. When such provisions are to be made applicable, they have been specifically mentioned in the Act as well as the Rules. Moreover, the power of the Labour Court to grant stay of the Recovery Certificate on condition that the petitioners deposit the amount is an inherent power. Further, if the submission of the petitioners is accepted that the Order 9, Rule 13 is applicable, the provisions of Order 9, Rule 13 itself are unambiguous and provide that an order for setting aside an ex parte decree may be made by the Court subject to such terms as to costs, payment into Court or otherwise as it thinks fit. The proviso to this Rule also shows that an ex parte decree need not be set aside merely because there is irregularity in service of the summons if the Court is satisfied that the defendant is given notice of the date of hearing and had sufficient time to appear and answer the plaintiff’s claim.

6. In the present case, the Labour Court was satisfied that in order to stay the recovery proceedings certain conditions should be imposed on the petitioners. By directing the petitioners to deposit 50% of the amount awarded alongwith the costs in Court would not in any manner prejudice the petitioners. In fact, if no such order had been made prior to granting stay of the Recovery Certificate, the Labour Court would have done injustice to the workman. In the event, the workmen succeeded in the matter they would have again to run from pillar to post in order to recover the amount payable to them. By directing the petitioners to deposit the amount in Court, the Labour Court had merely avoided this. Assuming that the petitioners had a good case on merits, no prejudice would have been caused to them if the amount had been deposited in the Court since there was no direction from the Labour Court allowing the respondent-workman to withdraw the amount.

7. I, therefore, see no reason to interfere with the orders of the Labour Court dated 10-5-2001 and 18-6-2001.

8. The judgments cited at the Bar on behalf of the petitioners do not take the case of the petitioners any further. Reliance is also placed on behalf of the petitioners on the judgments in the cases of Grindlays Bank Ltd. v. The Central Government Industrial Tribunal & others, and Balaji B. Kapale & another v. Punjaji B. Tayade & others, . The Grindlays Bank case (supra) decided whether the Labour Court has the power and jurisdiction to set aside an ex parte Award. In the case of Balaji B. Kapale (supra), this Court considered whether the Assistant Charity Commissioner becomes functus officio after the Award is passed or whether it has the power to set aside an ex parte Award.

9. There is no doubt that the Labour Court has jurisdiction to set aside the ex parte order. Whether such an Award or order should be set aside unconditionally is for the Labour Court to decide at its discretion. In the instant case, the Labour Court, while considering whether the stay should be granted unconditionally, has considered the fact that the petitioners had remained absent despite receipt of notice as well as intimation sent through the Court. They had also remained absent before the Commissioner of Labour when directed to appear before him on three occasions when the Recovery Certificate was issued. It was only thereafter that recovery proceedings were initiated against them. The Labour Court has given cogent reasons for allowing the stay application on condition that the petitioners deposit the amount as directed.

10. As regards the ex parte order itself which has also been challenged in the present petition, it appears that the Labour Court has on the basis of the evidence available before it, decided that the respondent-workmen were entitled to the amounts claimed by them from the petitioners. The petitioners have stated in that petition that on 1-5-1999, they had entered into an agreement with one Vikram Singh Thakur and they allowed him to conduct the business upto 30-4-2002 and there is no relationship of master and servant with the respondent workman. The application filed by the workers are in respect of the amounts due and payable to them from 25-9-1997 to 19-9-1999 when their services were terminated. Assuming the contention of the petitioners is correct and they were not responsible for the business from 1-5-1999, there is nothing in the petition to show as to why the amounts claimed prior thereto by the respondent-workmen should not be awarded. Therefore, in any event, these amounts have to be awarded to the respondent-workmen. For the period subsequent to 1-5-1999 upto 19-9-1999, the petitioners may be able to make out a case on merits. This may be doubtful as they have, despite their claim that there is no employer-employee relationship, chosen to settle the claim of one of the workman. The Labour Court may hear the application on merits provided the petitioners pay to the workmen the amounts claimed prior to 1-5-1999 within a period of four weeks from today and deposit the entire amount due and payable to the workmen from 1-5-1999 to 19-9-1999 under the ex parte order in the Labour Court within a period of two weeks from today.

11. In the circumstances of the case, Rule is discharged with costs.

12. Issuance of certified copy of this order is expedited.

After dictating this order, an oral application for stay is made. Stay refused.

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