Rajasthan State Road Transport Corporation & Anr. v. Bal Mukund Bairwa

10. The civil court, furthermore, being a court of plenary jurisdiction has the jurisdiction to determine its jurisdiction upon considering the averments made in the plaint but that would not mean that the plaintiff can circumvent the provisions of law in order to invest jurisdiction on the civil court although it otherwise may not possess. For the said purpose, the court in given cases would be entitled to decide the question of its own jurisdiction upon arriving at a finding in regard to the existence of the jurisdictional fact. It is also well settled that there is a presumption that a civil court will have jurisdiction and the ouster of civil court’s jurisdiction is not to be readily inferred. A person taking a plea contra must establish the same. Even in a case where jurisdiction of a civil court is sought to be barred under a statute, the civil court can exercise its jurisdiction in respect of some matters particularly when the statutory authority or Tribunal acts without jurisdiction.

11. In Dhulabai vs. State of M. P. [(1968) 3 S.C.R. 662], this Court held as under: “(1) Where the statute gives a finality to the orders of the special tribunals the civil court’s jurisdiction must be held to be excluded if there is adequate remedy to do what the civil courts would normally do in a suit. Such provision, however, does not exclude those cases where the provisions of the particular Act have not been complied with or the statutory tribunal has not acted in conformity with the fundamental principles of judicial procedure. (2) Where there is an express bar of the jurisdiction of the court, an examination of the scheme of the particular Act to find the adequacy or the sufficiency of the remedies provided may be relevant but is not decisive to sustain the jurisdiction of the civil court. Where there is no express exclusion the examination of the remedies and the scheme of the particular Act to find out the intendment becomes necessary and the result of the inquiry may be decisive. In the latter case it is necessary to see if the statute creates a special right or a liability and provides for the determination of the right or liability and further lays down that all questions about the said right and liability shall be determined by the tribunals so constituted, and whether remedies normally associated with actions in civil courts are prescribed by the said statute or not. (3) Challenge to the provisions of the particular Act as ultra vires cannot be brought before Tribunals constituted under that Act. Even the High Court cannot go into that question on a revision or reference from the decision of the Tribunals. (4) When a provision is already declared unconstitutional or the constitutionality of any provision is to be challenged, a suit is open. A writ of certiorari may include a direction for refund if the claim is clearly within the time prescribed by the Limitation Act but it is not a compulsory remedy to replace a suit. (5) Where the particular Act contains no machinery for refund of tax collected in excess of constitutional limits or illegally collected a suit lies. (6) Questions of the correctness of the assessment apart from its constitutionality are for the decision of the authorities and a civil suit does not lie if the orders of the authorities are declared to be final or there is an express prohibition in the particular Act. In either case the scheme of the particular Act must be examined because it is a relevant enquiry. (7) An exclusion of the jurisdiction of the civil court is not readily to be inferred unless the conditions above set down apply.” {See also Church of North India vs. Lavajibhai Ratanjibhai & ors. [(2005) 10 SCC 760], United India Insurance Co.Ltd. vs. Ajay Sinha & Anr. [2008 (8) SCALE 509]}

12. The word “industrial dispute” is defined in Section 2(k) of the 1947 Act to mean: “(k) “industrial dispute” means any dispute or difference between employers and employers, or between employers and workmen, or between workmen and workmen, which is connected with the employment or non-employment or the terms of employment or with the conditions of labour, of any persons;” The expression ‘workman’ has been defined in clause (s) of Section 2 to mean any person (including an apprentice) employed in any industry to do any manual, unskilled, skilled, technical, operational, clerical or supervisory work for hire or reward, whether the terms of employment be express or implied, and for the purposes of any proceeding under this Act in relation to an industrial dispute, includes any such person who has been dismissed, discharged or retrenched in connection with, or as a consequence of, that dispute, or whose dismissal, discharge or retrenchment has led to that dispute, but does not include any such person- (i) who in subject to the Air Force Act, 1950 (45 of 1950), or the Army Act, 1950 (46 of 1950), or the Navy Act, 1957 (62 of 1957); or (ii) who is employed in the police service or as an officer or other employee of a prison; or (iii) who is employed mainly in a managerial or administrative capacity; or (iv) who, being employed in a supervisory capacity, draws wages exceeding one thousand six hundred rupees per mensem or exercise, either by the nature of the duties attached to the office or by reason of the powers vested in him, functions mainly of a managerial nature. Clause (g) of Section 2 defines ‘employer’ to mean: “(g) “employer” means-

(i) in relation to any industry carried on by or under the authority of any department of the Central Government or a State Government, the authority prescribed in this behalf, or where no authority is prescribed, the head of the department;

(ii) in relation to an industry carried on by or on behalf of a local authority, the chief executive officer of that authority;”

13. Indisputably, the 1947 Act provides for the forum for determination of an industrial disputes raised between workmen and workmen; workmen and employer; and employer and employer inter alia if any reference is made by an appropriate Government in exercise of its power conferred upon it under Section 10 thereof. Section 11 of the 1947 Act provides for procedure and power of conciliation officers, Boards, Courts and Tribunal while Section 11A confers extensive power on the labour court or the Industrial Tribunal to interfere with an order of punishment imposed upon a workman including a power to substitute the punishment awarded by the employer upon holding a domestic enquiry.

14. Section 3 of the 1946 Act obligates every industrial establishment to frame Standing Orders in respect of matters set out in the Schedule appended thereto and submit the same to the certified officer who shall certify the same upon arriving at its satisfaction that they have been framed in accordance of the 1946 Act. Upon such certification, the Standing Orders become binding upon the employer and employees.

15. The question in regard to the jurisdiction of a Civil Court vis-à-vis adjudication of rights/obligations created by or under the 1947 Act came up for consideration in The Premier Automobiles Ltd. vs. Kamlekar Shantaram Wadke of Bombay & ors. [(1976) 1 SCC 496], wherein following the dicta laid down in Wolverhampton New Waterworks Co. vs. Hawkesford [(1859) 6 CB (NS) 336: 28 LJ CP 242: 141 ER 486], law was laid down in the following terms: “23. To sum up, the principles applicable to the jurisdiction of the civil court in relation to an industrial dispute may be stated thus: (1) If the dispute is not an industrial dispute, nor does it relate to enforcement of any other right under the Act the remedy lies only in the civil court. (2) If the dispute is an industrial dispute arising out of a right or liability under the general or common law and not under the Act, the jurisdiction of the civil court is alternative, leaving it to the election of the suitor concerned to choose his remedy for the relief which is competent to be granted in a particular remedy. (3) If the industrial dispute relates to the enforcement of a right or an obligation created under the Act, then the only remedy available to the suitor is to get an adjudication under the Act. (4) If the right which is sought to be enforced is a right created under the Act such as Chapter V-A then the remedy for its enforcement is either Section 33-C or the raising of an industrial dispute, as the case may be.”

16. The question came up for consideration again before a three Judge Bench of this Court in Krishna Kant (supra) wherein, inter alia, it was held:

With greatest of respect to the learned judges, if a statute while creating rights and obligations did not constitute a forum for enforcing the same, plenary jurisdiction of the civil court in view of Premier Automobiles Ltd.(supra) could not be held to have been taken away. There was also no occasion to extend the scope of the dicta laid down therein. Certified Standing Orders lay down the terms and conditions of service. It did not create any new right such as Section 25F, 25G or 25H of the Industrial Disputes Act, 1947. Any new right created under a statute would ordinarily be a right in favour of an employee over and above the general law. Let us, however, proceed on the basis that the dicta laid down therein is correct.

17. A similar question, however, came up for consideration before a two-Judge Bench of this Court in Rajasthan State Road Transport Corporation & Ors. vs. Zakir Hussain [(2005) 7 SCC 447], wherein this Court following the seven-Judges Bench decision of this Court in A.R. Antulay vs. R.S. Nayak [(1988) 2 SCC 602] opined that if the court has no jurisdiction, it cannot be conferred by an order of the court. Therein the order of termination was a simpliciter one which was passed during the period of probation and, thus, did not entail any stigma or civil consequences visiting him. In the facts of the case, Krishna Kant (supra) was not followed, stating:

18. The question came up for consideration again before a three-Judge Bench of this Court again in Khadarmal (supra) wherein referring to Krishna Kant (supra) and Zakir Hussain (supra), it was held that the civil court has no jurisdiction to adjudicate. However, without noticing Para 37 in Krishna Kant (supra), this Court held:

Para 37 of Krishna Kant (supra), however, was noticed in Rajasthan SRTC & Anr. vs. Ugma Ram Choudhary [(2006) 1 SCC 61] to hold:

19. In view of somewhat different conclusions arrived at by this Court in different cases as noticed hereinbefore whereas the contention of Mr. Tapas Ray, learned Senior Counsel appearing on behalf of the appellant – Corporation is that despite the fact that the suits were instituted and decrees were passed prior to the date of pronouncement of judgment in Krishna Kant (supra), we should opine that the civil court had no jurisdiction and, thus, dismiss the suit; the contention of Ms. Aishwarya Bhati and other learned counsel appearing on behalf of the respondent is that as doctrine of prospective overruling was applied in Krishna Kant (supra) and furthermore as in this case the suit is based on the allegations of violation of principles of natural justice, this Court should not interfere with the decrees passed by the learned trial court.

20. Before us, however, the statutory Regulations framed by the appellant – Corporation under Section 45 of the Act had been placed. We do not find that any distinction has been made in regard to the matters relating to holding of the departmental proceedings against an employee for commission of a misconduct vis-à-vis the industrial workers. The question as to whether in a case of this nature where violation is alleged as regards compliance of principles of natural justice either on common law principles or in terms of the statutory Regulations framed by the appellant – Corporation, which is a fundamental right in terms of Article 14 of the Constitution of India, a civil suit will be maintainable or not, thus, have not been taken into consideration in any of the aforementioned decisions. The legal principles, namely, presumption in regard to the jurisdiction of the Civil Court and interpretation of a statute involving plenary jurisdiction of a civil court had also not been taken into consideration. In Wolverhampton New Waterworks Co. (supra), it has categorically been laid down: “There are three classes of cases in which a liability may be established by statute. There is that class where there is a liability existing at common law, and which is only re-enacted by the statute with a special form of remedy; there, unless the statute contains words necessarily excluding the common law remedy, the plaintiff has his election of proceeding either under the statute or at common law. Then there is a second class, which consists of those cases in which a statute has created a liability, but has given no special remedy for it; there the party may adopt an action of debt or other remedy at common law to enforce it. The third class is where the statute creates a liability not existing at common law, and gives also a particular remedy for enforcing it…. With respect to that class it has always been held, that the party must adopt the form of remedy given by the statute.” It was on the aforementioned principle, the question of applicability of principles 1, 2 and 3 laid down in Para 23 in Premier Automobiles Ltd. (supra) will have to be taken into consideration.

21. A dispute arising in between an employer and employee may or may not be an industrial dispute. The dispute may be in relation to or arising out of a fundamental right of the employee, or his right under a Parliamentary Act and the Regulations framed thereunder, and/or a right arising under the provisions of the Industrial Disputes Act or the sister laws and may relate to same or similar rights or different rights, or even may be based on common law right or contractual right. The question in regard to the jurisdiction of the civil court must, therefore, be addressed having regard to the fact as to which rights or obligations are sought to be enforced for the purpose of invoking or excluding the jurisdiction of a civil court.

22. Appellant, as noticed hereinbefore, is a State within the meaning of Article 12 of the Constitution of India. If an act on its part is found to be wholly unreasonable or arbitrary, the same would be violative of Article 14 of the Constitution of India. In certain situations, even gross violation of the principles of natural justice has been held to come within the ambit of Article 14. {See also Satyavir Singh & ors. vs. Union of India & ors. [(1985) 4 SCC 252], Delhi Transport Corporation vs. D.T.C. Mazdoor Congress & ors. [1991 Supp (1) SCC 600], Union of India & Anr. vs. Tulsiram Patel [(1985) 3 SCC 398], Central Inland Water Transport Corporation Limited & Anr. vs. Brojo Nath Ganguly & Anr. [(1986) 3 SCC 156]} Any order passed in violation of the principles of natural justice save and except certain contingencies of cases, would be a nullity. In A.R. Antulay (supra), this Court held: “No prejudice need be proved for enforcing the fundamental rights. Violation of a fundamental right itself renders the impugned action void. So also the violation of the principles of natural justice renders the act a nullity.”

23. If an employee intends to enforce his constitutional rights or a right under a statutory Regulation, the civil court will have the necessary jurisdiction to try a suit. If, however, he claims his right and corresponding obligations only in terms of the provisions of the Industrial Disputes Act or the sister laws so called, the civil court will have none. In this view of the matter, in our considered opinion, it would not be correct to contend that only because the employee concerned is also a workman within the meaning of the provisions of the 1947 Act or the conditions of his service are otherwise governed by the Standing Order certified under the 1946 Act ipso facto the Civil Court will have no jurisdiction. This aspect of the matter has recently been considered by this Court in Rajasthan State Road Transport Corporation & ors. vs. Mohar Singh [(2008) 5 SCC 542]. The question as to whether the civil court’s jurisdiction is barred or not must be determined having regard to the fact of each case. If the infringement of Standing Order or other provisions of the Industrial Disputes Act are alleged, the civil court’s jurisdiction may be held to be barred but if the suit is based on the violation of principles of common law or constitutional provisions or on other grounds, the civil court’s jurisdiction may not be held to be barred. If no right is claimed under a special statute in terms whereof the jurisdiction of the civil court is barred, the civil court will have jurisdiction. Where the relationship between the parties as employer and employee is contractual, right to enforce the contract of service depending on personal volition of an employer, is prohibited in terms of Section 14(1)(b) of the Specific Relief Act, 1963. It has, however, four exceptions, namely, (1) when an employee enjoys a status, i.e., his conditions of service are governed by the rules framed under the proviso appended to Article 309 of the Constitution of India or a statute and would otherwise be governed by Article 311(2) of the Constitution of India; (2) where the conditions of service are governed by statute or statutory Regulation and in the event mandatory provisions thereof have been breached; (3) when the service of the employee is otherwise protected by a statute; and (4) where a right is claimed under the Industrial Disputes Act or sister laws, termination of service having been effected in breach of the provisions thereof. Appellant – Corporation is bound to comply with the mandatory provisions of the statute or the regulations framed under it. A subordinate legislation when validly framed becomes a part of the Act. It is also bound to follow the principles of natural justice. In the event it is found that the action on the part of State is violative of the constitutional provisions or the mandatory requirements of a statute or statutory rules, the civil court would have the jurisdiction to direct reinstatement with full back wages. In Praga Tools Corpn. Vs. C.A. Imanual [(1969) 1 SCC 585], it was held:-

[See also Rajasthan State Road Transport Corporation & ors. vs. Mohar Singh (supra)]

24. There is another aspect of the matter which cannot also be lost sight of, namely, where the conditions of service are governed by two statutes, the effect thereof on an order passed against an employee/workman in violation of a rule which would attract both the statutes. An attempt shall be made in a case of that nature to apply the principles of ‘Harmonious Construction”. When there is a doubt as to whether civil court has jurisdiction to try a suit or not, the courts shall raise a presumption that it has such jurisdiction. In Mahendra L. Jain & ors. vs. Indore Development Authority & ors. [(2005) 1 SCC 639], this Court held:

25. We may also notice that there is nothing to show that rights were created under the Certified Standing Orders. It has not been stated that the conditions of service in respect of an employee are different under 1950 Act and 1946 Act. The matter might have been different if a statute was brought into force later than the earlier statute which would attract the provisions of Article 254 of the Constitution of India one being in direct conflict with the other as was noticed in M.P. Vidyut Karamchari Sangh vs. M.P. Electricity Board [(2004) 9 SCC 755]. Thus, the rights and obligations of the employer having arisen under two Parliamentary Acts, the question of invoking the provisions of Article 254 (1) of the Constitution of India would also not arise herein. Provisions of both the statutes must be given effect to

26. Mr. Ray, however, would submit that the application of principles of natural justice may be different keeping in view, (i) the common law principles; (ii) the statutory provisions; and (iii) the constitutional provisions. The principles of natural justice ensure fairness. It means that a result or process should be just. It is a harmless, though it may be a high-sounding expression; in so far as it attempts to reflect the old jus naturale, it is a confused and unwarranted transfer into the ethical sphere of a term employed for other distinctions; and, in so far as it is resorted to for other purposes, it is vacuous, so said LORD SHAW of Dunfermline in Local Government Board v. Arlidge [1915] AC 120 at p. 138 (HL).

27. The purpose of principles of natural justice is prevention of miscarriage of justice and hence the observance thereof is the pragmatic requirement of fair play in action. {See Sawai Singh vs. State of Rajasthan [(1986) 3 SCC 454], Narinder Mohan Arya vs. United India Insurance Co. Ltd. & ors. [(2006) 4 SCC 713]}

28. In a case where no enquiry has been conducted, there would be violation of the statutory Regulation as also the right of equality as contained in Article 14 of the Constitution of India. In such situation, a civil suit will be maintainable for the purpose of declaration that the termination of service was illegal and the consequences flowing therefrom. However, we may hasten to add if a suit is filed alleging violation of a right by a workman and a corresponding obligation on the part of the employer under the Industrial Disputes Act or the Certified Standing Orders, a civil suit may not lie. However, if no procedure has been followed as laid down by the statutory Regulation or is otherwise imperative even under the common law or the principles of natural justice which right having arisen under the existing law, sub-para (2) of paragraph 23 of the law laid down in Premier Automobiles Ltd. (supra) shall prevail.

29. An assumption on the part of this Court that all such cases would fall only under the Industrial Disputes Act or sister laws and, thus, the jurisdiction of the civil court would be barred, in our opinion, may not be the correct interpretation of Premier Automobiles Ltd. (supra) which being a three-Judge Bench judgment and having followed Dhulabhai (supra), which is a Constitution Bench judgment, is binding on us.

30. We may also observe that the application of doctrine of prospective overruling in Krishna Kant (supra) may not be correct because either a court has the requisite jurisdiction or it does not have. It is well settled principle of law that the court cannot confer jurisdiction where there is none and neither can the parties confer jurisdiction upon a court by consent. If a court decides a matter without jurisdiction as has rightly been pointed out in Zakir Hussain (supra) in view of the seven-Judge Bench decision of this Court in A.R. Antulay (Supra), the same would be nullity and, thus, the doctrine of prospective overruling shall not apply in such cases. Even otherwise doctrine of prospective overruling has a limited application. It ordinarily applies where a statute is declared ultra vires and not in a case where the decree or order is passed by a court/tribunal in respect whereof it had no jurisdiction. [See C. Golak Nath & ors. vs. State of Punjab & anr. (AIR 1967 SC 1643)] In M.A. Murthy v. State of Karnataka and Ors. [(2003) 7 SCC 517], this Court held: “…It is for this Court to indicate as to whether the decision in question will operate prospectively. In other words, there shall be no prospective overruling, unless it is so indicated in the particular decision. It is not open to be held that the decision in a particular case will be prospective in its application by application of the doctrine of prospective overruling. …..” (See also Ashok Kumar Sonkar vs. Union of India & ors. [(2007) 4 SCC 54] As has been pointed by Justice Cardozo, in his famous compilation of lectures – The Nature of the Judicial Process – that in the vast majority of cases, a judgment would be retrospective. It is only where the hardship is too great that retrospective operation is withheld. A declaration of law when made shall ordinarily apply to the facts of the case involved.

31. We, therefore, answer the question of law referred before us and the matters be placed before the Division Bench for consideration of the facts of each case. …..……………………………… …..J. ( S.B. SINHA ) …..……………………………… …..J. (DR.

MUKUNDAKAM SHARMA) …..…………………………………..J. (ASOK KUMAR GANGULY) New Delhi JANUARY 12, 2009