Case Note & Summary
The appeals arose from a dispute between the Fertilizers and Chemicals Travancore Ltd. (FACT), a public sector undertaking, and its trade unions regarding the reduction of the retirement age of pre-1978 employees from 60 to 58 years. In 1978, a Memorandum of Settlement fixed the superannuation age at 60 for existing employees and 58 for new recruits. In 1998, the Central Government directed all PSUs to increase retirement age to 60, which FACT implemented. However, due to financial deterioration, the Central Government later directed FACT to revert the retirement age of pre-1978 employees to 58 years, which FACT did by order dated 29.04.2003. The trade unions challenged this order before the Kerala High Court in original petitions. The Single Judge dismissed the petitions, holding that the reduction was justified due to financial crisis and was not violative of Article 14. The Division Bench affirmed, and the Supreme Court dismissed the special leave petitions on 23.04.2004, thereby upholding the reduction. Subsequently, the State Government made a reference to the Labour Court under Section 10 of the Industrial Disputes Act, 1947, asking whether the reduction of retirement age was justifiable. The Labour Court held the reference barred by res judicata, as the issue had already been decided by the High Court and Supreme Court. The trade unions challenged this award before the High Court. The Single Judge allowed the writ petitions, holding that the reference was not barred by res judicata, and awarded 30% wages to the employees. The Division Bench affirmed. FACT appealed to the Supreme Court. The Supreme Court allowed the appeals, holding that the principle of res judicata applies to labour proceedings. Since the issue of reduction of retirement age had been finally adjudicated by the High Court and Supreme Court in the earlier round of litigation, the State Government could not refer the same issue to the Labour Court. The Labour Court's awards dated 02.07.2008 and 02.08.2008, which had dismissed the references as barred by res judicata, were restored. The Supreme Court set aside the impugned judgment of the High Court and dismissed the writ petitions filed by the trade unions.
Headnote
A) Industrial Law - Res Judicata - Applicability to Labour Court Proceedings - Section 10, Industrial Disputes Act, 1947; Section 11, Code of Civil Procedure, 1908 - The principle of res judicata applies to proceedings before a Labour Court under the ID Act. Where the issue of reduction of retirement age of pre-1978 employees from 60 to 58 years had been finally decided by the High Court and the Supreme Court in earlier writ proceedings, a subsequent reference by the State Government to the Labour Court on the same issue is barred by res judicata. The Labour Court cannot re-adjudicate a matter that has attained finality. (Paras 20-28)
B) Industrial Law - Reference under Section 10 ID Act - Jurisdiction of State Government - Section 10, Industrial Disputes Act, 1947 - The State Government's power to make a reference under Section 10 does not extend to referring an issue that has already been conclusively adjudicated by a competent court between the same parties. Such a reference is without jurisdiction and the Labour Court must decline to entertain it on grounds of res judicata. (Paras 20-28)
C) Industrial Law - Finality of Judgments - Binding Nature of Earlier Decisions - The dismissal of special leave petitions by the Supreme Court affirming the High Court's judgment upholding the reduction of retirement age constitutes a final adjudication. The same issue cannot be reopened through a fresh reference to the Labour Court. (Paras 13, 20-28)
Issue of Consideration
Whether the reference made by the State Government to the Labour Court under Section 10 of the Industrial Disputes Act, 1947, was barred by the principle of res judicata when the same issue had already been decided by the High Court and the Supreme Court in earlier litigation between the same parties.
Final Decision
The Supreme Court allowed the appeals, set aside the impugned judgment of the High Court, and restored the awards dated 02.07.2008 and 02.08.2008 of the Labour Court, which had held the references barred by res judicata. Consequently, the writ petitions filed by the trade unions were dismissed.
Law Points
- Res judicata
- Industrial Disputes Act
- 1947
- Section 10
- Section 11 CPC
- Finality of judgments
- Reference to Labour Court
Case Details
2019 LawText (SC) (4) 115
Civil Appeal No. 3803 of 2019 (Arising out of S.L.P.(C) No.99 of 2018) with Civil Appeal No. 3804 of 2019 (Arising out of S.L.P.(C) No.100 of 2018)
Mr. J.P. Cama, learned senior counsel for the appellants; Mr. P.V. Surendranath, learned senior counsel, Mr. Roy Abraham & Mr. C.M. Patel, learned counsel for the respondents
Chairman and Managing Director, The Fertilizers And Chemicals Travancore Ltd. & Anr.
General Secretary FACT Employees Association & Ors.
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Nature of Litigation
Civil appeals against the judgment of the Kerala High Court in writ appeals concerning the validity of a reference under Section 10 of the Industrial Disputes Act, 1947, on the ground of res judicata.
Remedy Sought
The appellants (FACT) sought to set aside the High Court's order which had quashed the Labour Court's awards and held that the reference was not barred by res judicata.
Filing Reason
The appellants challenged the High Court's decision that the reference made by the State Government to the Labour Court was not barred by res judicata, despite the same issue having been decided earlier by the High Court and Supreme Court.
Previous Decisions
The Single Judge of the Kerala High Court had dismissed the original petitions challenging the reduction of retirement age; the Division Bench affirmed; the Supreme Court dismissed the SLPs on 23.04.2004. Subsequently, the Labour Court held the reference barred by res judicata, but the Single Judge of the High Court set aside that award, which was affirmed by the Division Bench.
Issues
Whether the reference made by the State Government to the Labour Court under Section 10 of the Industrial Disputes Act, 1947, was barred by the principle of res judicata when the same issue had already been decided by the High Court and the Supreme Court in earlier litigation between the same parties.
Submissions/Arguments
Appellants (FACT) argued that the issue of reduction of retirement age had been finally decided by the High Court and Supreme Court, and therefore the reference to the Labour Court was barred by res judicata.
Respondents (Trade Unions) argued that the reference was maintainable and not barred by res judicata, and the Labour Court should adjudicate the issue afresh.
Ratio Decidendi
The principle of res judicata under Section 11 of the Code of Civil Procedure, 1908, applies to proceedings before a Labour Court under the Industrial Disputes Act, 1947. Where an issue has been finally adjudicated by a competent court between the same parties, a subsequent reference under Section 10 of the ID Act on the same issue is barred. The State Government cannot refer a dispute that has already been conclusively decided.
Judgment Excerpts
In our considered view, the question, as to whether the principle of res judicata defined in Section 11 of the Code of Civil Procedure, 1908 (hereinafter referred to as “the Code”) applies to the labour proceedings or not, remains no more res integra and stands answered by three decisions of this Court.
This Court ruled that the reference to the Labour Court made by the State under Section 10 of ID Act was hit by the principle of res judicata defined under Section 11 of the Code and, therefore, the reference made to the Labour Court was barred.
Procedural History
1978: Memorandum of Settlement fixed retirement age at 60 for existing employees and 58 for new recruits. 1998: Central Government directed PSUs to increase retirement age to 60; FACT complied. 2003: Central Government directed FACT to reduce retirement age of pre-1978 employees to 58; FACT issued order dated 29.04.2003. Trade unions filed original petitions in Kerala High Court (OP Nos.14598, 14599 & 14976/2003). Single Judge dismissed petitions on 12.08.2003. Division Bench dismissed appeals (WA Nos.1565,1595,2112 & 2113/2003) on 18.12.2003. Supreme Court dismissed SLPs (CC Nos.3653-3655/2004) on 23.04.2004. State Government made reference No.10/2004 to Labour Court on 18.05.2004 (amended 22.01.2008) and reference No.4/2005 on 02.03.2005. Labour Court passed awards on 02.07.2008 and 02.08.2008 holding references barred by res judicata. Trade unions filed writ petitions (WP Nos.33938/2008 and 2556/2009). Single Judge allowed writ petitions on 21.08.2012. Division Bench dismissed appeals (WA Nos.1820 and 1824/2012) on 25.01.2017. FACT filed SLPs in Supreme Court, which were converted into civil appeals.
Acts & Sections
- Industrial Disputes Act, 1947: Section 10
- Code of Civil Procedure, 1908: Section 11
