The Calcutta High Court has held that the Central Government is the "appropriate government" in matters related to industrial disputes involving nationalized companies, regardless of any contrary notification issued by the State Government. The ruling came from Justice Shampa Dutt (Paul) while deciding a writ petition filed by M/s. Braithwaite & Co. Limited against the orders passed by the Second Industrial Tribunal.
The case concerned the status of Braithwaite & Co., which was taken over by the Government of India under the Braithwaite & Company (India) Limited (Acquisition & Transfer of Undertaking) Act, 1976. Under Section 12(1) of the Act, from the appointed date of April 1, 1975, all workmen of the company were deemed to be employees of the Central Government.
An industrial dispute arose over a punishment imposed on a workman, and the State Government issued a reference to the Second Industrial Tribunal on February 5, 2008. The company objected, arguing that since it was a nationalized industry under the authority of the Central Government, only the Central Government could issue such a reference under Section 2(a)(i) of the Industrial Disputes Act, 1947.
“The appropriate government for industries carried on by or under the authority of the Central Government shall be the Central Government,” the Court noted, referring to Section 2(a)(i) of the Industrial Disputes Act.
Despite the company's objection, the Tribunal rejected their application on November 10, 2010. It held that although a Central Government notification dated May 5, 2008 had revoked an earlier one from July 3, 1998, the new notification did not apply retrospectively. Therefore, the State Government’s reference made before May 5, 2008 was considered valid. The Tribunal’s decision was upheld even upon a review petition filed by the company, which was dismissed on February 18, 2011.
Aggrieved, the company approached the High Court, relying on the Supreme Court’s judgment in Steel Authority of India Ltd. v. National Union of Waterfront Workers. In that case, the apex court held that a nationalized industry carried on under the authority of the Central Government falls within the jurisdiction of the Central Government under the Industrial Disputes Act.
The petitioner also contended that once the 1998 notification was revoked by the 2008 notification, the earlier notification ceased to have effect, and the Tribunal erred in relying on it.
In response, the State maintained that the 2008 notification had no retrospective effect and the 1998 notification governed the dispute on the date the reference was made.
“A company being government-owned is not enough. It must also be shown that it carries on business under the authority of the Central Government, either by law or by formal delegation,” the Court observed, citing Supreme Court precedent.
Ultimately, the Calcutta High Court ruled in favor of the petitioner, stating that the company was indeed operating under the Central Government’s authority, and its employees were deemed Central Government employees. Accordingly, the orders dated November 10, 2010 and February 18, 2011 passed by the Second Industrial Tribunal were found not to be in accordance with law and were set aside.
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“Since the company was nationalized and operated under Central authority, the Central Government is the appropriate authority for dispute adjudication,” the Court concluded.
The writ petition was thus allowed, and the appeal disposed of.
Case Name: M/s. Braithwaite & Co. Limited v. Second Industrial Tribunal & Ors.
Case No.: WPA 2477 of 2012
Petitioner's Counsel: Ranajay De (Senior Advocate), Basabjit Banerjee, Adityajit Abel Bose
Respondent’s Counsel: Bipin Ghosh
