LABOUR AND INDUSTRIAL LAW CASE ANALYSIS

LABOUR AND INDUSTRIAL LAW

CASE ANALYSIS ON
JH JADHAV V. FORBES GOKAK LTD.

PARTIES
PETITIONER: J.H. JADHAV
RESPONDENT: M/S. FORBES GOKAK LTD.

CITATION
(2005) 3 SCC 202
CORAM
JUSTICE RUMA PAL & JUSTICE C.K. THAKKER

SUBMITTED BY-
AASTHA GANDHI
PRN:16010125273
DIVISON C
IX SEMESTER BA.LLB (HONS.)

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LABOUR AND INDUSTRIAL LAW CASE ANALYSIS

TABLE OF CONTENTS

TABLE OF CONTENTS..................................................................................................2

FACTS OF THE CASE.....................................................................................................2

ISSUES.............................................................................................................................3

RULES/LAW APPLICABLE...........................................................................................3

ANALYSIS........................................................................................................................3

CONCLUSION.................................................................................................................6

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LABOUR AND INDUSTRIAL LAW CASE ANALYSIS

FACTS OF THE CASE1

The Petitioner was an employee of the Respondent who had been passed over for a promotion.  The
Petitioner then claimed promotion as a clerk. However, the promotion was not granted to him and he
proceeded to raise an industrial dispute before the Industrial Dispute Tribunal. Furthermore, the grounds for
the dispute included the fact that his juniors had been promoted before him and the Petitioner still was not
able to obtain a promotion. Therefore, the Petitioner wanted the Tribunal to order that he was to be promoted
with effect from the date on which his juniors were promoted. However, it was contended by the
Respondent that the dispute raised by the Petitioner was not an industrial dispute under the ambit of Section
2(k) of Industrial Disputes Act, 1947 since he was not supported by a majority number of workers or a
majority union. In this regard, the Petitioner submitted that his claims were supported by the Gokak Mills
Staff Union.2

The Tribunal came to the conclusion that it was clear that the Petitioner’s cause was espoused by a Union
which was one of the Unions of the Respondent employer. The Tribunal also noted that employees who
were junior to the Petitioner had been promoted and there was nothing on the record to show the reasons as
to why the Petitioner had not been promoted, thereby concluding that the Respondent had engaged in unfair
labour practice. It passed an award in favor of the Petitioner directing the Respondent to promote him as a
clerk from the date his juniors were promoted and give him all the consequential benefits. The award was
challenged by way of writ petition but a Single Judge Bench dismissed it. The award was then challenged
before the Appellate Court which held that the dispute was not an industrial dispute and set aside the award
of the Tribunal. The Petitioner, aggrieved by the decision of the High Court, filed a Special Leave Petition
before the Supreme Court which proceeded to conclude that the decision of the High Court was irrational
and therefore, unsustainable. The order of the Tribunal was confirmed subject to a modification that
promotion will be given effect from the date of promotion of his juniors up until the date of his dismissal
from service.

ISSUES

1
JH Jadhav v. Forbes Kokak ltd 2005 3 SCC (202).
2
CIT v. Gokak Mills Ltd. (1983) 142 ITR 525 (Bom)

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LABOUR AND INDUSTRIAL LAW CASE ANALYSIS

 Whether the dispute raised by the Petitioner was an individual dispute or an industrial dispute
under Section 2 (k) of Industrial Disputes Act, 1947?

RULES/LAW APPLICABLE

Section 2(k) of Industrial Disputes Act, 19473

“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
person;”

The object of the Industrial Disputes Act, 1947 is to make provisions for settlement of industrial disputes.
However, to attract the operations under the same, the disputes needs to mandatorily fall within the
definition of “industrial dispute” as per Section 2(k) of the Act.4

ANALYSIS

The Tribunal was right in declaring that the dispute raised by the Petitioner was an industrial dispute under
Section 2(k) of Industrial Disputes Act, 1947. However, the High Court set aside the award on 2 main
grounds viz. firstly, it construed that a dispute is an industrial dispute only when the dispute directly and
substantially affects the interest of other workmen and secondly, it held that the dispute must be taken up by
a Union which had representative character or by a substantial number of employees before it could be
converted into an industrial dispute. It then proceeded to state that there was nothing on the record to show
that either of the 2 conditions set by it had been satisfied.5

A bare perusal of Section 2(k) shows that an industrial dispute means any dispute or difference between:

1. Employer and Employers

The next condition is that the dispute must be connected either with:

3
Section 2(k) of Industrial Disputes Act, 1947
4
Workmen v. Indian Hume Pipe Co. Ltd., 1986 Supp SCC 79
5
Rohtas Industries Ltd. & Anr vs Rohtas Industries Staff Union and ors. 1976 AIR 425, 1976 scr (3) 12
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LABOUR AND INDUSTRIAL LAW CASE ANALYSIS

1. Employment
2. Non-employment
3. Terms of employment
4. Conditions of Labour

By applying the golden rule of interpretation, it can be subsumed that a dispute shall be considered as an
industrial dispute if it relates to a dispute between the employer and the workman in connection with the
employment or non-employment of that workman. The dispute in the present is between the employer and
the workman in connection with the employment of the workman. 6 Therefore, the dispute raised by the
Petitioner was an industrial dispute under the meaning of Section 2(k) of the Industrial Disputes Act, 1947.

Moreover, several cases have provided detailed discussions on meaning o ‘industrial dispute’ and the law is
fairly settled in the same regard. The decision of the Apex Court in the case of Workmen of M/s.
Dharampal Premchand (Saughandhi) v. M/s. Dharampal Premchand (Saughandhi) 7, which is the most
authoritative decision on this point of law adds an extra condition for the dispute to considered as an
industrial dispute. The Court held that for the purpose of Section 2(k) of the Industrial Disputes Act, 1947,
the following conditions must be fulfilled to be consider a dispute as an industrial dispute:

1. It must be shown that dispute is connected with the employment or non-employment of a workman
2. The dispute between a workman and his employer must be espoused by the Union of workmen or by
a number of workmen

The Court also clarified that the term ‘Union’ would mean a union of workmen or by a number of workmen
even though it may be a union of minority of the workmen. The additional condition was also fulfilled in the
present case as the dispute of the Petitioner had been espoused by the Gokak Mills Staff Union. While the
decision in the case is considered as locus classicus, the High Court slightly modified the second condition

stating that the dispute had to be espoused by a majority Union of the establishment rather than just a Union.
Moreover, it also failed to give reasons to evolve a new test when a settled test was already in place.8

In the case at hand, it was not even questioned that the Petitioner was a member of the Gokak Mills Staff
Union and an issue regarding the Union being not a union of the Respondent establishment was also not
raised.9 The dispute fulfilled all the tests and conditions for being classified as an industrial dispute. The
only objection put forth by the Respondent was that the Gokak Mills Staff Union was not the majority
union. The Tribunal referred to the decision in the Dharampal Premchand Case and rightly rejected the
objection of the Respondent.
6
CIT v. Gokak Mills Ltd. (1983) 142 ITR 525 (Bom)
7
Workmen of M/s. Dharampal Premchand (Saughandhi) v. M/s. Dharampal Premchand (Saughandhi )AIR1966SC182
8
Bongaigaon Refinery & Petrochemicals Ltd. v. Samijuddin Ahmed, (2001) 9 SCC 79
9
Chief Engineer, Hydel Project V. Ravinder Nath, (2008) 2 SCC 350
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LABOUR AND INDUSTRIAL LAW CASE ANALYSIS

Firstly, no particular format has been prescribed as far as espousal is concerned. But, the proof of such
espousal can be made available from other external sources. In the case at hand, the Tribunal appreciated the
oral and documentary evidence and found that the Gokak Mills Staff Union had espoused the Petitioner’s
cause. Thus, the High Court, in the first place should not have held that the Petitioner’s cause had not been
espoused by any Union. Secondly, the Division Bench of the High Court had misapplied the principles of
judicial review under Article 226 in interfering with the decision of the Tribunal. Therefore, the conclusion
reached by the High Court was irrational and perverse.10

The Supreme Court rightfully set aside the order of the High Court. It also went on to hold that while in the
meanwhile, the Petitioner had been dismissed from service, the order of the dismissal was altogether another
matter and their decision in the current case was not concerned with the propriety of the dismissal order. The
Court admitted that the effect of the dismissal was that the Petitioner could not have been granted the
promotion on the day of pronouncing the judgment. It went on to hold that irrespective of the judgment in
the case relating to the dismissal, the Petitioner was nevertheless entitled monetary benefits of the promotion
pursuant to the award of the Tribunal up until the date of his dismissal.11

CONCLUSION

The judgment of the Apex Court in the case of JH Jadhav v. Forbes Gokak Ltd. reaffirms the decision of the
Supreme Court in the case of M/s. Dharampal Premchand (Saughandhi) v. M/s. Dharampal Premchand
(Saughandhi). The question as to whether an individual dispute can be considered as an industrial dispute
has been fairly settled in law and 3 stage test for determination is fairly certain and devoid of any major
ambiguity.12 While the decision can be considered prudent, it does open the door for a lot of speculation.
Since a minority union or a group of people can also espouse the cause of the person raising the dispute,
there is a huge possibility that any and all disputes can be considered as industrial disputes if they are
espoused by 2 people. This is the point that the High Court wanted to raise when it prescribed that the
majority union must espouse the cause for a dispute to be considered as an industrial dispute. Although, the
10
Journal of the Indian Law Institute, Volume 50, ‘Industry,’ Industrial Dispute’, and ‘Workman’; Conceptual Framework and
Judicial Activism By Bushan Tilak Kaul
11
Workmen of Nilgiri Coop. Mkt Society Ltd. v. State of T.N., (2004) 3 SCC 514
12
A.J Fernandis v. Divisional Manager, South Central Railway 2001 S.C.C 240
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LABOUR AND INDUSTRIAL LAW CASE ANALYSIS

test propounded by the High Court is right in its concept, the extreme condition might lead to genuine
industrial disputes being left out of the ambit of Section 2(k). I do not find any reason to tamper with the
existing test in place, but if an alternative could be evolved while considering the above-mentioned
reservation, it could lead to consolidating the scope of industrial dispute.

BIBLIOGRAPHY

STATUTE
 Industrial Disputes Act, 1947

CASES
 JH Jadhav v. Forbes Kokak ltd 2005 3 SCC (202).
 Workmen of M/s. Dharampal Premchand (Saughandhi) v. M/s. Dharampal Premchand (Saughandhi)
AIR 1966 SC182.
 Workmen of Nilgiri Coop. Mkt Society Ltd. v. State of T.N., (2004) 3 SCC 514.
 CIT v. Gokak Mills Ltd. (1983) 142 ITR 525 (Bom).
 Workmen v. Indian Hume Pipe Co. Ltd., 1986 Supp SCC 79.
 Chief Engineer, Hydel Project V. Ravinder Nath, (2008) 2 SCC 350.
 Bongaigaon Refinery & Petrochemicals Ltd. v. Samijuddin Ahmed, (2001) 9 SCC 79.

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LABOUR AND INDUSTRIAL LAW CASE ANALYSIS

 Rohtas Industries Ltd. & Anr vs Rohtas Industries Staff Union and ors. 1976 AIR 425, 1976 scr (3).
 A.J Fernandis v. Divisional Manager, South Central Railway 2001 S.C.C 240.

BOOKS
 Labour and Industrial Laws, P.K. Padhi, Third Edition

LEGAL SOURCES

 Hein Online
 JSTOR
 Manupatra