JUDGMENT
Nishita Mhatre, J.
1. This petition is directed against the order dated 22nd August 1995 passed by the Labour Court, Pune in applications under Section 33C(2) of the Industrial Disputes Act, 1947. The applications have been dismissed on 22nd August 1995. According to the Petitioner, he was working at the plant of the first Respondent at Wagholi. It appears that on 12th December 1989 the first Respondent entered into a Settlement with Sarva Shramik Sanghatana, a trade union representing the workmen employed with the first Respondent. Under this Settlement, the workers were entitled to production incentive as per the scheme at Annexure I to the Settlement. Accordingly the workers were paid production incentive. A new Settlement was entered into between the Sanghatana and the first Respondent on 16th October 1992. By this Settlement, it was agreed that the production incentive scheme would be revised and finalized soon, in consultation with the workers and the staff union. It appears that the scheme was not finalized for quite a long period. The first Respondent stopped paying the incentive under the 1989 settlement and, therefore, the Petitioner along with 71 others filed applications under Section 33C(2) of the Industrial Disputes Act, 1947 in 1994. These applications were opposed by the first Respondent on the ground that there was no existing right to the production incentive as the earlier Settlement of 12th December 1989 had been revised by the Settlement of 16th October 1992.
2. The Labour Court by its common order dated 22nd August 1995, held that the applications filed by the Petitioner and 71 others were not maintainable as there was no existing right with the workmen to claim production incentive. According to the Labour Court, the Settlement of 16th October 1992 substituted the earlier Settlement of 12th December 1989 and the Petitioner and other applicants would be entitled to production incentive as per the 1992 Settlement. The Labour Court was of the view that if the 1992 Settlement did not specify any rate or scheme for production incentive, the remedy for the Petitioner and workmen like him lay elsewhere and not in filing applications under Section 33C(2) of the Industrial Disputes Act, 1947.
3. Mr. Avinash Falangare appearing for the Petitioner submits that although the earlier settlement was replaced or substituted by the Settlement of 1992, since there was no scheme finalized or it was pending finalisation, the benefits available to the workmen under the earlier Settlement of 1989 ought to have been continued till the scheme was actually finalised and payment under the new scheme commenced. He submits that the Labour Court has erred in coming to the conclusion that there was no existing right and, therefore, the application was not maintainable. The learned Advocate urges that the existing right accrued to the workmen under the old Settlement of 1989 and the benefits continued to flow until it was substituted by another scheme. The learned Advocate places reliance on the judgment in the case of Life Insurance Corporation of India v. D.J. Bahadur and Ors., .
4. Mr. Purav for the first Respondent submits that the earlier clause regarding production incentive had been substituted by the clause contained in the Settlement of 1992. This clause stipulated that the production incentive scheme would be finalised by the first Respondent in consultation with the workers and staff union. Therefore, according to the learned Advocate, the earlier Settlement had been substituted and no right could flow from that Settlement. He then urges that the earlier scheme under the 1989 Settlement also specified that the scheme would be in force for a period of three years only and, therefore, automatically this scheme came to an end on 31st March 1992. The learned Advocate submits that the period of operation of the Settlement cannot be considered on par with the period mentioned in the scheme itself and, therefore, although benefits under the Settlement could flow a laid down in the case of Life Insurance Corporation (supra), the scheme having come to an end in 1992 as stipulated, the production incentive could not be granted to the workmen.
5. It would be useful at this stage to set out certain clauses on which the entire claim is based. The 1989 Settlement had the following clause in respect of production incentive:
“C. PRODUCTION INCENTIVE
Eligible workers will be entitled to production incentive as per Scheme enclosed in Annexure I.”
Clause 2 of the annexure to the Settlement of 1989 reads as follows:
“2. The incentive scheme will be in force during the tenure of settlement period i.e. 1st April, 1989 to 31st March, 1992.”
The 1992 Settlement contained the following clause in respect of production incentive:
” PRODUCTION INCENTIVE
The workers will be entitled to production incentive as per the revised production incentive scheme that shall soon be finalised in consultation with the workers and Staff Union.”
The workmen were eligible to the 1989 scheme during the pendency of the Settlement. As held by the Apex Court in the case of Life Insurance Corporation (supra), a settlement continues to operate and benefits under it continue to flow till such time as it is replaced either by a Settlement or an Award regulating the relations between the parties. In the present case, the subsequent Settlement of 1992 merely stated that the production incentive scheme would be revised and would be finalised in consultation with the workers and staff union. Therefore, until the scheme was finalised, the earlier scheme would continue to operate, irrespective of whether it was stated in the Annexure to the Settlement that the scheme would continue to operate during the tenure of the Settlement. The scheme has not been revised. What has been agreed by the 1992 Settlement is that the parties would finalise the production incentive scheme. This does not mean that the scheme itself has been revised. Therefore, in my view, till such time as the scheme is revised, the workmen would be entitled to the production incentive as paid under the 1989 Settlement. As noted by the Supreme Court in the case of Life Insurance Corporation (supra), a contract or award continues to regulate the relationship between the parties until such time the new contract or award replaces the old. This has been the position in industrial law all through.
6. Hence, the order 22nd August 1995 passed by the Labour Court, Pune must be set aside. The application merely mentions that the amount payable towards production incentive should be computed by the Labour Court. The Labour Court having dismissed the applications on the ground that they were not maintainable, now will have to compute the amounts payable to the workmen. The Application is, therefore, remanded back to the Labour Court, Pune for computing the amounts payable to the Petitioner and other workmen.
7. Rule made absolute accordingly. No order as to costs.
8. Parties to act on an authenticated copy of this Judgment.