A.K.Mukherjea, J. - (1.) This is an application under Article 226 of the Constitution of India for quashing an order of reference made under the Industrial Disputes Act as well as all proceedings relating to the said order. The facts and circumstances of the case are shortly as follows: The petitioner is a private limited company and is a manufacturer of diverse kinds of electrical and allied goods. There are two registered Trade Unions of the workers of the petitioner company; one of them is known as the Staff Union and the other as the Workers' Union. The petitioner's workmen are either monthly rated or hourly-rated. In 1959 the petitioner paid ex gratia to its hourly-rated as well as monthly-rated workmen a sum equivalent to 1/8th of the basic wages earned by a workman as bonus for the year 1958. On August 25, 1960 the workers' Union demanded 3 months' basic wages as bonus for 1959; the Staff Union made no such demand. According to the petitioner, the profits made by the company during the previous year did not justify the award of any bonus at all. The dispute about the bonus for 1960 was referred to the Conciliation Officer for settlement. This led to the initiation of a Conciliation proceeding. According to the petitioner, the Staff Union knew all the time about this conciliation proceeding but they did not take any part in the proceedings. On 22 September 1960, there was a settlement between the petitioner-company and its workmen which was arrived at as result of the conciliation proceeding. Under that settlement it was inter alia agreed that the petitioner would make an ex gratia payment of 1/18th of the basic wages earned by a workman as bonus for the previous year 1959. It was further agreed that the petitioner would as a special case and without creating any precedent waive recovery of advance made by the petitioner to its workmen under the memorandum of settlement dated 7th October, 1958 to the extent of 1/12th of basic wages earned during the year ending 31st October, 1957. On 22nd September 1960 the petitioner issued a notice intimating all its workmen that in terms of the aforesaid tripartite settlement 1/18th of the basic wages earned by a workman would be paid ex gratia as bonus for the previous year 1959. So far as the hourly rated workmen of the petitioner are concerned, they accepted the bonus in terms of the said notice. As for the workmen who are monthly-rated and who are represented by the Staff Union there was protest. According to the petitioner, however, a large number of such workmen also accepted the said bonus in terms of the said notice. Those workmen belonging to the Staff Union who refused to accept the bonus demanded payment of at least 1 months' basic wages as bonus. On 24 September 1960, the President of the Staff Union addressed a letter to the Labour Commissioner stating the grounds of their claim for bonus at the rate of 11/2 months' basic pay and requested intervention of the Labour Commissioner in this matter. By a letter dated 27th April, 1961, Government informed in reply to the aforesaid representation that the question of bonus for the year ended 31st October, 1959, had been settled with the Workers' Union and a tripartite agreement reached on 22 September 1960 under which the company had agreed to pay 1/18th of a workman's basic wages earned during the year ending 31st October, 1959, to all permanent workmen on the roll of the company on the date of payment. On this ground Government refused to intervene in this matter. Subsequently, it appears, Government published an order, being order 1987 -- I. R. No. ----------------- I. R./10L.-112/62 dated 17th May, 1963 by which the dispute raised by the Staff Union regarding bonus for the year ending 31st October, 1959 was referred for adjudication to the Fifth Industrial Tribunal. The petitioner now contends that this reference was incompetent and illegal as the settlement of September 22, 1960 arrived at in course of conciliation proceedings was binding on all the workmen of the Company so that no further reference in law could be made on the same dispute. The petitioner raised this as a preliminary objection before the Industrial Tribunal and challenged the maintainability of the reference. The learned Industrial Tribunal after hearing the preliminary objections passed an order on 16th January, 1965 to the effect that the question whether the settlement dated 22 September 1960 binds all the workmen of the petitioner or not is a question of fact pure and simple and it was necessary to take some evidence for coming to a decision as to whether the settlement was binding on all the workmen or not. On this footing the Tribunal directed both the parties to adduce evidence in support of their contentions and fixed 25th March, 1965 as the date of hearing of this preliminary objection. The petitioner has now challenged the legality of the reference and the proceedings in this application.
(2.) The principal contention urged by Mr. Sankar Baneriee appearing for the petitioner is that under Section 18 (3) (d) of the Industrial Disputes Act the settlement which was arrived at between the company and the Workers' Union would also be binding on the members of the Staff Union and there could, therefore, be no dispute over the question of bonus covered by the settlement which can be referred to an industrial Tribunal or which can be adjudicated by an Industrial Tribunal.
(3.) Section 18 of the Industrial Disputes Act deals with the persons on whom settlement and awards are binding. Section 18 (1) provides that a settlement arrived at by agreement between the employers and its workmen shall be binding only on the parties to the agreement where the settlement is one which is not reached in the course of conciliation proceedings. Section 18 (3), however, says that where the settlement in question is arrived at in the course of conciliation proceedings under the Act, that settlement, where the parties to the dispute are composed of workmen, is binding on "all persons who were employed in the establishment or part of the establishment, as the case may be, to which the dispute relates on the date of the dispute and all persons who subsequently become employed in that establishment or part.";