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Mukund Iron & Steel Works Limited v/s V.G. Dashpande & another

    Writ Petition No. 1995 of 1984 (O.S.)

    Decided On, 05 February 1986

    At, High Court of Judicature at Bombay


    For the Petitioner: Ashok H. Dusar with P.K. Rele, D.R. Nath and A.M. Vernekar, Advocate. For the Respondent: M.A. Morje, S.J. Deshmukh with N.M. Ganguli, Advocates.

Judgment Text


On 11th August, 1983 the Additional Registrar of Trade Unions

informed the Rashtriya Mukand Employees' Union (the 2nd respondent) that he had no 10th August, 1983 cancelled its registration on the ground that it had contravened the provisions of section 28 of the Trade Unions Act by failing to send an annual return. On 18th August, 1984 the Registrar of Trade Unions informed the 2nd respondent, with reference to its letters enclosing the annual return and requesting restoration of registration, that the letter dated 11th August, 1983 "is hereby withdrawn as the Union has complied with provisions of Trade Union Act, 1926, by submitting the necessary annual returns. The only question that I have to consider in this petition is whether the Registrar had the power to withdraw the cancellation of the registration.

2. Mukund Iron & Steel Works Ltd., (the petitioners) have at Kalwe in the district

of Thane. The 2nd respondent was the recognised trade union representing workmen

at the Kalwe factory. The 2nd respondent was until 10th August 1983 registered as a trade union under the provisions of the Trade Union Act, 1926 (now referred to as the said Act). On 11th August, 1983 the Additional Registrar informed the 2nd respondent that he had cancelled its registration on the ground that, after due notice from the Registrar, it had continued wilfully to contravene the provisions of section 28 of the Act and Rule 17 of the Bombay Trade Union Regulations in that it had failed to send to the Registrar by the prescribed date the annual general statement of accounts in the

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prescribed annual return form for the year ending 31st December, 1981, which was required under the said section to be sent annually to the Registrar.3. It is the case of the 2nd respondent that the notice referred to in the letter dated 11th August, 1983 had not been received by it for it was operating from premises other than the address registered with the Registrar.4. On 17th August, 1984 the 2nd respondent wrote to the Registrar, enclosing the annual return for the year ended 31st December, 1981, and requested him to "withdraw the cancellation letter". On 17th August, 1984 the 2nd respondent wrote to the Registrar stating that audit for the year 1982 was in progress and expressing the hope that it would be in a position to file the annual returns for the year 1982 by 25th August, 1984. The letter requested condonation of delay.5. On 18th August, 1984 the Registrar wrote to the 2nd respondents thus : "With reference to your letters dated 17-8-84 and 18-8-84 together with the annual Returns of your union for the year ending 31st December, 1981 and 1982 requesting for the restoration of the registration of your union, I have to state that this office letter No. CL/TUA/1181/Cancellation/By-II-D/7108 dated 11-8-83 is hereby withdrawn as the Union has complied (sic) with provisions of Trade Unions Act, 1926, by submitting the necessary annual returns."6. This petition is filed to quash the letter dated 18th August, 1984.7. The said Act was enacted to provide for the registration of trade unions and in certain respects to define the law relating to registered trade unions. A trade union is defined under section 2(h) to mean any combination, whether temporary or permanent, formed primarily for the purpose of regulating the relations between workmen and employers or between workmen and workmen, or between employers and employers, or for imposing restrictive conditions on the conduct of any trade or business, and includes any federation of two or more trade unions. A registered trade union is defined by section 2(e) to be a trade union registered under the said Act. Section 8 provides that the Registrar, on being satisfied that a trade union has complied with all the requirements of the said Act in regards to registration, shall register the trade union by entering in a register, to be maintained in such form as may be prescribed, the particulars relating to the trade union contained in the statement accompanying the application for registration. Under section 9 the Registrar is enjoined, on registering a trade union under section 8, to issue a certificate of registration in the prescribed form which would be conclusive evidence that the trade union had been duly registered under the said Act. The certificate of registration of a trade union may, under section 10, be withdrawn or cancelled by the Registrar inter alia if the Registrar is satisfied that the trade union, after notice from the Registrar, have wilfully contravened any provision of the said Act, provided that not less than two months' previous notice in writing specifying the ground on which it was proposed to withdraw or cancel the certificate had been given by the Registrar to the trade union. Any person aggrieved by the refusal of the Registrar to register a trade union by the withdrawal or cancellation of a certificate of registration may, under section 11, appeal. Where the head office of the trade union is situated within the limits of a Presidency town the appeal lies to the High Court. The Appellate Court may dismiss the appeal, or it may pass an order directing the Registrar to register the trade union and to issue a certificate of registration, or it may set aside the order of withdrawal or cancellation. The Registrar is obliged to comply with such order. For the purposes of the appeal, the Appellate Court is obliged, so far as may be, to follow the same procedure and have the same powers as it follows and has when trying a suit under the Code of Civil Procedure. Where the head office of the trade union is not situated within the limits of a Presidency town, the appeal lies to a Court subordinate to the High Court and in the event of its dismissal, persons aggrieved have the right of appeal to the High Court. Section 12 deals with the registered office of a trade union and requires notice of any change in the address thereof to be given within 14 days of such change to the Register in writing so that the changed address can be recorded in the register. Every registered trade union is, by virtue of the provisions of section 13 a body corporate of the name under which it is registered and has perpetual succession and a common seal with power to acquire and hold both movable and immovable property and to contract, and can by the said name sue and be sued. Section 28 deals with the returns to be sent annually to the Registrar. It requires that a general statement audited in the prescribed manner of all receipts and expenditure of every registered trade union during the calendar year next preceding such prescribed date shall be sent to the Registrar. Section 31 provides for the penalties that may be imposed upon the trade union's office bearers if default is made by the trade union in sending any statement or document required by the provisions of the Act.8. Mr. Desai, learned Counsel for the petitioners, submitted, having regard to the power of the Registrar under the said Act, that plainly, the Registrar had no power to withdraw the cancellation of the registration of the 2nd respondent.9. Mr. Morje learned Counsel for the Registrar (the 1st respondent), relied upon section 21 of the General Clauses Act. In his submission, by virtue of section 21, the Registrar had the power to rescind or cancel any order made by him.10. Section 21 of the General Clauses Act states that where, by any Central Act or Regulation, a power to issue notifications, orders, rules or bye-laws is conferred, then that power includes a power, exercisable in the like manner and subject to the like sanction and conditions, if any, to add to, amend, vary or rescind any notifications, orders, rules or bye-laws so issued. From a bare perusal it is clear that section 21 applies only to notifications, orders, rules or bye-laws of general application made under enactments and in the manner of subordinate legislation. It has no application to an order such as that passed by the Registrar on 18th August, 1984 to cover a specific case. I find support for this construction in the judgment of Division Bench of the Patna High Court in (Bhola Prasad Singh v. Prof. U.A. Goswami)1, A.I.R. 1963 Pat. 437 (paragraph 16).11. Mr. Deshmukh, learned Counsel for the 2nd respondent, submitted that the Registrar had implicit power to withdraw the cancellation of the 2nd respondent's registration, and it had to be deduced from the fact that the provisions of the said Act were intended to register trade unions, not to exclude them from registration. While there can be no quarrel with this, it is difficult to see how it can lead to the conclusion that the Registrar has such implicit power.12. In this regard, Mr. Deshmukh also relied upon the provisions of section 11(3) whereunder, as has been pointed out, the Appellate Court is invested with the same power and is required to follow the same procedure as it has and follows while trying a suit under the Code of Civil Procedure. Mr. Deshmukh submitted that a Court hearing a suit is obliged to record terms of compromise between the parties. By reason of section 11(3), the Appellate Court was obliged to accept terms of compromise between a trade union and the Registrar whereby the cancellation of registration was withdrawn. This showed that the Registrar had implicit power to withdraw the cancellation of registration.13. Section 11(3) regulates the procedure to be followed by the Court hearing an appeal and invests it with certain power in this behalf. It does not in any manner suggest to me any implicit power in the Registrar to withdraw an order of cancellation of the Registration of a Trade Union.14. Mr. Deshmukh relied upon the judgment of the Supreme Court in (Grindlays Bank v. The Central Government Industrial Tribunal)2, A.I.R. 1981 S.C. 606. This was a case in which the Tribunal had made an ex parte award. On the application of the party who was not heard the Tribunal set aside the ex parte order. It was contended before the Supreme Court that the Tribunal had no power to do so. The Supreme Court was of the opinion that the Tribunal had the power to pass the impugned order if it is so thought fit in the interests of justice. It was well-known rule of statutory construction that a Tribunal or body should be considered to be endowed with such ancillary or incidental powers as were necessary to discharge its functions effectively for the purpose of doing justice between the parties. The tribunal should, therefore, be considered as invested with such incidental or ancillary powers unless there was any indication in the Industrial Disputes Act to the contrary. Examining the statute, the Supreme Court found that there was no statutory prohibition, but there were indications to the contrary. One such indication was the fact that the Tribunal was empowered to follow such procedure as it thought fit. This was a power of the widest amplitude and conferred ample power upon the Tribunal to devise such procedure as the justice of the case demanded. The Supreme Court confirmed its earlier finding in Narshi Takershi's case, A.I.R. 1970 S.C. 1273 that a review on merits could not be made unless the power to do so had been conferred either specifically or by necessary implication. But when a review was sought due to a procedural defect, the inadvertent error committed by the Tribunal had to be corrected ex debito justitiae to prevent the abuse of its process and such power inhered in every Court or tribunal. The Supreme Court also considered the argument that the Tribunal had become functus officio once it made the award and found it unacceptable because the proceedings with regard to a reference under section 10 of the Industrial Disputes Act were not deemed to be concluded until the expiry of 30 days from the publication of the award. Till then the Tribunal retained jurisdiction over the dispute referred to it and had the power to entertain application in connection with the dispute.15. The principles laid down in Grindlay Bank's case can have no application to the present case. In the first place, it must be noted that the Registrar purported to withdraw the cancellation not because prior notice of such cancellation had not been served on the 2nd respondent, as Mr. Deshmukh strenuously argued, but, in terms, because it had, subsequently to the cancellation, submitted the annual returns. The order withdrawing the cancellation was, therefore, in no sense an order made to correct an abuse. In the second place, the 2nd respondent had a remedy against the order in that it could appeal there against or apply for fresh registration The order was, therefore, in no sense necessary ex debito justitiae. Thirdly, the order was passed relying upon events that had occurred subsequently to the cancellation.16. Mr. Deshmukh pointed out that the cancellation had been intimated to the 2nd respondent on 11th August, 1983 by the Additional Registrar of Trade Unions while the withdrawal of the cancellation had been effected by the Registrar of Trade Unions. He pointed out that under section 3(2) the Additional Registrar discharged the power and functions of the Registrar under the superintendence and direction of the Registrar. In Mr. Deshmukh's submission, the order of withdrawal dated 18th August, 1984 was passed by the Registrar in exercise of his power of superintendence. A bare reading of the letter dated 18th August, 1984 makes it clear that it was passed not in exercise of any power of superintendence but because the 2nd respondent had by then filed the annual returns.17. Mr. Deshmukh said that the cancellation that had been effected on 10th August, 1983 had been effected only by drawing a line across the entry relating to the 2nd respondent in the register maintained by the Registrar. The registration certificate of the 2nd respondent remained with it and was conclusive evidence of registration under section 9. By virtue of section 10, no cancellation could be effected except in the manner thereunder prescribed. In Mr. Deshmukh submission, there had, therefore, been no valid cancellation of the 2nd respondent's registration.18. The validity of the cancellation is not in issue here. I must proceed in this petition upon the basis that the 2nd respondent's registration was validily cancelled.19. Mr. Deshmukh's last submission was that the Court's discretionary power under Article 226 should not be exercised in favour of the petitioners because the cancellation of the 2nd respondent's registration had not been effected without following the prescribed procedure, in that it had not been addressed the notice that is a pre-condition of de-registration at its then address. It appears that this address had not been communicated to the Registrar as is required by the said Act to be entered in the register, but that some communications from Registrar had been addressed to the 2nd respondent at this address.20. Where a party is aggrieved by an order of cancellation, and I assume the 2nd respondent was so aggrieved, it has remedies in the form of an appeal and in the form of an application for fresh registration. The 2nd respondent has not invoked these remedies. It cannot then be said that the powers under section 226 should not be exercised because the cancellation of the 2nd respondent's registration had been effected improperly.21. When, to sum up, the Registrar cancels or withdraws the registration of a trade union, it has the option to appeal or to apply for fresh registration. If the appeal succeeds the order of cancellation or withdrawal of recognition could be held to be bad ab initio and the trade union would continue on the register as if that order had not been passed. If a fresh registration is permitted it would operate from the date thereof. Once the Registrar cancels or withdraws the registration of a trade union he has no power left qua that order. He has no power to review it. He certainly has no power to withdraw it because of subsequent events.22. In the result, the petition must succeed and it is made absolute in terms of prayer (a).23. There shall be no order as to costs.24. Rule accordingly.Rule accordingly.

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