RAMACHANDRA SPINNING MILLS Vs. STATE OF MADRAS

JUDGEMENT

(1.) THE plaintiff is a firm of partners called Sri Ramachandra Spinning Mills, Pandalapaka. The first defendant is the State of Madras. The second defendant is one Venkata Reddi who was an employee in the plaintiff's mill. In September 1946 the first defendant appointed Mr. Sherfuddin, the then District Judge of East Godavari, as an adjudicator to report what rates of dearness allowance the plaintiff's mill (as well as another) should be required to pay to its employees. While Mr. Sherfuddin's enquiry was in progress, Government referred to Mr. Venkataramiah the wider question of the wage structure of the textile mills in the Province. Mr. Venkataramiah made an interim report recommending that the rates of pay should be on a certain basis and on 18 February 1946 Government issued G. O. No. 4637 giving effect to his proposals. Mr. Sherfuddin made his report on 23 December 1946 and Government accepted the remommendations contained in it and directed that this should be given effect to?vide G. O. Ms. 39, dated 4 January 1947. On 19 June 1947 Mr. Venkataramiah gave his final award and in G. O. No. 3080, Development, dated 15 July 1947, Government directed that the rates mentioned in Mr. Venkataramiah's award should be implemented. The order of Government provided that the award should be in operation for a period of one year from 1 April 1947. The plaintiff paid wages and dearness allowance as laid down in the various orders of Government till the end of June 1947. It is alleged in the plaint that it was then found that the mill was working at a loss and could not any longer carry on its business. Therefore, on 11 June 1947 the management of the plaintiff mill wrote to the Inspector of Factories notifying that they intended to shut down from 1 July 1947 until more favourable conditions appeared. Accordingly the mill was closed on 1 July 1947 and remained closed till 1 April 1948 when it was reopened. On 10 July 1947 Government issued a Government order bearing Ms. No. 2991 in which it was mentioned that an industrial dispute had arisen between the workers and the management of the plaintiff's mill "on the question of closure of the mill" and referred "the said industrial dispute" for adjudication to Mr. Markandeyulu. On 11 July 1947 Government issued a further order G. O. Ms. No. 3031 under Section 10 (3) of the Industrial Disputes Act (Act XIV of 1947) prohibiting the continuance of what they called the lockout in the mill. The plaintiff applied to Government on 28 July 1947 asking that the Government order be recalled, but they declined to do so. In the award which he made on 5 January 1948 Mr. Markandeyulu took the view that the closure of the mill was not justified and recommended that Mr. Venkataramiah's final award might be given effect. The case of the plaintiff is that there was really no industrial dispute at all because the closure of the mill "could in no sense of the term be treated as an industrial dispute within the meaning of the Act" and as such G. O. No. 2991, dated 10 July 1947, and the reference to the industrial tribunal thereunder was ultra vires, without jurisdiction and void. The plaintiff states that G. O. No. 3031 based as it was on the previous Government order was equally ultra vires, without jurisdiction and void. However, the second defendant filed a suit, O. S. No. 349 of 1948, on the file of the Court of the District Munsif of Ramachandrapuram against the partners of the plaintiff firm claiming a sum of Rs. 497-14-6 as wages and dearness allowance for the period between July 1947 and March 1948 at the rate fixed in Mr. Venkataramiah's award. The Collector of East Godavari on behalf of the Government also filed a criminal complaint against the plaintiff under Section 29 of the Industrial Disputes Act. In these circumstances the plaintiff prayed for

(2.) IN the statement which the Government filed they pleaded that on 10 July 1947 on which date G. O. Ms. No. 2991 was issued there was an industrial dispute within the meaning of Sub-clause (k) of Section 2 of the Industrial Disputes Act, 1947, and that in consequence they were acting well within the scope of their authority and power in referring the dispute for adjudication. Government also controverted the suggestion that the award of Mr. Markandeyulu was ineffectual and not binding on the plaintiff. It was further pleaded that the action of the plaintiff amounted to a lockout and as the lockout had been declared illegal the plaintiff was bound to pay wages and dearness allowance for the period between 1 July 1947 and 31 March 1948. Government took the final point: This defendant submits that this Court has no jurisdiction to go behind the order of reference and into the existence or otherwise of an industrial dispute and declare the order of reference and the award following it to be bad on that ground. In the statement which the second defendant filed he took the following points:

(3.) THE following are the issues in the suit: