MAHABIR JUTE MILLS LTD. GORAKHPUR versus SHIBBAN LAL SAXENA AND ORS.

MAHABIR JUTE MILLS LTD. GORAKHPUR

SlllBBAN LAL SAXENA AND ORS.

July 30, 1975

[A. N. RAY C. J., K. K. MATIIEW, V. R. KRISHNA IYER AND S. M. FAZAL ALI, JJ.J

U.P. Industrial Disputes Act, 1941-Sec. 3-Whether Government while deciding whether dispute should be rejeJ'f1ed for adjudication entitled to rely upon the secret rrport sent by the conciliation of]icer--Whether a11 admn. order of the Governn1ent should be s;,:eaking order-Principles of natural justice-fVhether court ca11 direct Governn'1enr how to exercise its discr£ti411-Dclay in i}isposal of labour matters.

The appellant employs about 1000 workmen. In the year 1955 all tho !000 workmen were dismissed by the appellant after holding certain enquiries. Out of the 1000 \Vorkmen 200 workmen apologised and they were reinstated. The remaining 800 workmen were, hcwever, not reinstated. The workmen Union invoked jurisdiction of the Regional Conciliation Officer under clause 4(1) of the Government Nctification dated 14-7-1954 passed under sec. 3 of the U.P. Indus-trial Disputes Act, 1947. Conciliation Board consisting of the Additional Reg:.Onal Conciliation Officer as the Chairman and one representative each of the 1-fanagement and Labour as members was constituted. Before· the Conciliation Board, no settlement could be arrived at. The members of the Conciliation Board se.nt their reports to the Labour Commissioner which were placed before the Government. The Additional Rgional Conciliation Officer who was the Chairman of the Board sent secret report to the Labour Commissioner recom-mending that the allegations made by the workers against the management \vere baseless and should not be entertained. The Government by its order dated 28-2-1956 refused to make reference to the lndustrial Tribunal on the ground that it was not expedient to do so. The workn;ien filed Writ Petition in 1958 for quashing the order of the Government dated 28-2-1956 and for directing fresh reference. The learned Single Judge allowed the Writ Petition in October, 1963. The Appellate Bench of the High Court dismissed the appeal of the management in 1972. The Writ Petition was pending in the High Court for 14 years. The ]earned Single Judge set aside the order of the Government on the following grounds ~

(1) The (iovernment relied on the secret report sent by the Regional Conciliation Officer.

~i\dditicnal

(2) The order of the Government was not ·speaking order.

The Division Bench held that the order need not be speaking order. Rules of natural justice \Vould apply to administrative proceedings. It is not necessary that the administrative orders should be speaking orders unless the Statute speci-fically enjoins such requirement. It is desirable that such orders should contain reasons when they decide matters affecting the rights of parties. The D~vision Bench set aside the order of the Government refusing to make reference on the following grounds :

The D~vision

(1} The Government took intc consideration the Secret report which had seriously prejudiced and coloured its decision.

(2) The Additional Regional Conciliation Officer should have shown the secret report to other members of the Conciliation Hoard in accord-ance with the principles of natural justice.

MAHABIR JUTE MILLS V. S. L. SAXENA

(3) The Government order was passed purely on the secret report sent by the AddiEonal Regional Conciliation Officer as also the report of the Labour Commissioner.

Pursuant to the judgment of the HE.gh Court, the State Government made reference in the year 1973.

Allowing the appeal by certificate,

l-IELD : ( 1) The administrative decisions are not genera11y required to be accompanied by statement of reasons. In diverse Society such as ours, the Government has to work through several administrative agencies wh:.Ch have got very vi1ide sphere and if every administrative order is required to give reasons it will bring the Governmental machinery to stand-still. [172F-G}

2. There is no reliable material on record to show that the Government order was passed n1ainly on the secret report of the Additional Regional Conciliation Officer or of the Labour Commissioner. In the counter affidavit filed on behalf of Government it was specifically stated that in the opinion of the Government it was not expedient to refer th..! dispute to the adjudication after the matter was • fully considered by the Government. Under section 4K of the U.r. Industrial Disputes Act, the Government has w1.de discretion to act under certain circum-stances. If the Government on the basis of the material before it comes to the conclusion that no .real dispute existed and it was not expedient to n1ake reference one can hardly find fault with the order of the Government. There was no reason for excluding the secret report submitted by the Additional Re-D gional Conciliation Officer at all. [173E-H; 174E-G]

3. Before the Additional Regional Conciliation Officer made his report all the n1les of natural justice were fully complied with. The parties were given bear-ing, their points of view were fully considered and, in fact, the representatives of the management and that of the hibour were the members of the Board. There is no provision for submitting the report by Chairman and members of the Board to each other. The principles of natural justice are very essential but they have got their own limits and cannot be stretched too far. A. K. Kraipak's case dis ... tinguished. In the present case, all the indicia of the principles of natural jUstice were present. [l 76B-E; 177 A, DJ

4. Even if the High Court thought that the impugned order of the Govern-ment sufiered from any legal infirmi.ty all that it could have done was to ask the Government to reconsider it but it had no jurisdiction to direct the Government how to act and how to exercise its statutory discretion which was conferred on the Government by section 4K of the U.P. Industrial Disputes Act. There was absolutely no \Varrant for the H:,gh Court in prohibiting the Government from considering the secret report of the Additional Regional Conciliation Officer or that of the Labour Colil_missioner. [l 78B-D]

5. The order of the High Court is not legally sustainable and 1nust be quashed. [l 78D)

6. The reference made by the Government in the year 1973 was not in exer-cise of its independent decision but was mainly because of the directions given in the High Court judgment. If the order of the High Court is quashed it will un-doubtedly materially affect the decision of the Government in n1ak.ing refe-rence to the Industrial Tribunal. Had the Government made reference unin-fluenced by the High Court's direct!.on the situation would have been different. Any scbsequent proceedings which come into existence as result of the High Court order would fall to the ground as logical corollary of the setting aside of the High Court judgment. [179A-BJ

[1. We would like to make' it clear that the Government h"" ample discretion to make reference to the Industrial Tribunal under sec. 4K of the U.P. Industrial Disputes Act if it •O thinks fit. Even if reference was refused by

[1976) 1 S.C.R.

17 0 SUPREME COURT REPORTS

the Government that will not debar the Government from making reference at later time if it is satisfied that under the changed circumstances the reference is necessary, [179D-Fl

2. The Court is constrained to observe that labour matters should have been given top urgency ctnd should not have been allowed to prolong for such long period in the High Court, otherwise, inordinate delay results in situation causing embarrassment both to the court and to the parties. It is very necessary that such matters should be disposed of by the High Court within year of the presentation of the petition. [172A-C]

CML APPELLATE JURISDICTION : Civil Appeal No. 781 of 1973.

From the judgment and order dated the May 8, 1972 of the Allaha-bad High Court in Special Appeal No. 914/1963.

S. V. Gupte, A. K. Sen, E. C. Agarwala and Promod Swarup, for the appellant.

K. R. Chowdhuri and S. L. Sethia, for respondents 1 and 2.

G. N. Dikshit and 0. P. Rana, for respondents 3 and 4.

The Judgment of the CourJ was delivered by

FAzAL Au, J. This is an appeal by the management of M/s Maha-bir Jute Mills situated at Gorakhpur by certificate granted by the High Court of Allahabad under Art. 133 of the Constitution of India. , M/s Mahabir Jute Mills Ltd. was formed some time in the year 1946 and soon thereafter when Shibban Lal Saxena one of the respondents was elected as President of the Labour Union of the Mill disputes arose between the workers and the Company as result of which Shibban Lal Saxena sent notice to the management on December 31, 1946 threaten-ing general strike. Thereafter several disputes arose between the parties which were some times settled, sometimes re-opened and in this appeal we are not concerned with those matters. In the previous disputes the order of the management retrenching some workers was upheld by the Regional Conciliation Officer and against that Shibban Lal Saxena served notice of strike listing 18 demands and calling upon the management to reinstate the retrenched workers and pay them bonus. This notice was given on March 31, 1954. On April 16, 1954 total strike was launched and Shibbari Lal Saxena left for China. During his absence it appears that the management arrived at some sort of settlement with the working President of the Union and the dispute for the time being was resolved on July II, 1954. Shibbanlal Saxena, however, returned from China and with his re-entry into the Union matters assumed serious proportions and the disputes reached high pitch. Mr. Saxena is alleged to have excited the workers and wanted to re-open the agreement reached between the management and the working President of the Union on July 11, 1954. He also started an agitation and the workers responded to the go-slow call given by Mr. Saxena as result of which the production of the Company came down from 500 cuts to 300 cuts resulting in huge losses to the Com-pany as alleged by th~ management. It is further alleged that Mr. Saxena had delivered number of infiamatory speeches as result of which the management charge-sheeted two workers for wilful jamming

of bobbins in the Spinning Section as result of which the spinning work came to stop. On January 4, 1955 the management held an inquiry against the two workers and three other workers who appeared to be in sympathy with them were also charge-sheeted for their stay-in-strike. Th!s strike continued right upto January 13, 1955 in spite of the efforts of the management to arrive at settlement. This was followed by charge-sheet which was served by the management on various workers· on February 5, 1955. Mr. Saxena protested to the management saying. that the charge-sheets were absolutely baseless. notice was put on the main gate of the Mill on February 22, 1955 informing that an in-quiry would be held on February 25, 1955 and after inquiry which the respondents described as mere farce large number of workers were served dismissal notices. It appears that out of 1000 workers all of them had been dismissed from service but 200 workers who apologised were reinstated and. taken back. In view of these developments the Union invoked jurisdiction of the Regional Conciliation Officer under clause 4(1) of the Government Notification dated July 14, 1954 passed under s. 3 of the U.P. Industrial Disputes Act, 1947. Conciliation Board consisting of the Additional Regional Conciliation Officer as the· Chairman and Shibban Lal Saxena and Shri Arora representing the· labour and the management respectively as members was constituted. The Conciliation Board heard the case but unfortunately no settlement could be arrived at. Consequently the reports of the members of the Board forwarded to the Labour Commissioner were placed before the-Government. Mr. P. C. Kulshreshtha the Additional Regional Conci" liation Officer and Chairman of the Board sent secret report to the Labour Commissioner recommending that the allegations made by the workers against the management were baseless and should not be enter-tained. After considering the reports, the Government of U.P. by its order dated February 28, 1956 refused to make reference to the Indus-trial Tribunal on the ground it was not expedient to do so. There was some controversy before the Single Judge of the High Court on the question as to when the order of the Government was received by the workers and the Hinh Court accepted the plea of the workers that there was sufficient delay in communicating the order of the Government to the workers as result of which writ petition was filed before the High· Court after year and half. Bnt the High Court found that the peti-tioners were not guilty of latches. This matter is closed issue and need not detain us .

writ petition was eventually filed on May 15, 1958 for quashing the order of the Government dated February 28, 195 6 and for direct-ing fresh reference. The writ petition was allowed by the order of the Single Judge dated October 7, 1963. Thereafter the management went up in special appeal to the Division Bench of the Allahabad High Court which decided the appeal on May 8, 1972 and quashed the order of the Government and directed it to reconsider the same in the light of the observations made by the High Court. It would thus appear that this writ petition was pending in the High Conrt for as i;nany as four-teen years with the result that strange situation has developed to-day. By the time the appeal has been heard by this Conrt more than seven-teen years have elapsed when the impugned order of the Government

was passd and almost twenty years after the management liad dismissed 800 workers. It is said that the management after dismissal of the old workers had appointed new workers who had by now put in about twenty years of service. We are constrained to observe that labour matters should have been given top urgency and should not have been - allowed to be prolonged for such long period in the High Court, otherwise the inordinate delay results in situation causing embarrass-ment both to the Court and to the parties. It is, therefore, very neces-sary and in the fitness of things that such matters should be given top priority and should be disposed of by the High Corirt within year of the presentation of tJie petition.

The learned Single Judge while allowing the petition set aside the order of the Government and directed the Government to make re-ference to the Industrial Tribunal -after ignoriag the secret report sent by the Additional Regional Conciliation Officer. Another reasd,1 which the Single Judge gave was that as the order of the Government did no( state any reasons and was not speaking order it was legally invalid and was fit to be quashed. The Division Bench of the High Court in appeal has not accepted, and in our opinion, rightly this part of the order of the High Court which was set aside. T,he Division Bench has held that as the order of the Government was purely an administrative order, unless there was any provision which required the Government to give reasons for the order, the mme could not be vitiated for the abse'ace of the reasons. The High Court observed thus :

"The function of the Government is administrative. · In law administrative decisions are not generally required tci be accompanied by statement of reasons. There is nothing in the Industrial Disputes Act or the notification aforesoaid requiri\1g the State Government to state its reasons in support of its conclusion. There was nothing particular in the pre-sent case impelling the issuance of such direction to the State Government."

We find ourselves in complete agreement with the view taken by the High Court on this point. In diverse society such as our's the Governme'at has to work through several -administrative agencies which have got very wide sphere and if every administrative order is re-quired to give reasons it will bring the governmental machinery to stand-still. It is well-settled that while the rules of natural justice would apply to administrative proceedings, it is not necessary th'at the administrative orders should be speaking orders unless the statute specifically e'ajoins such requirement. But we think it desirable that such orders should contain reasons when they decide matters affecting the rights of parties. The Division Bench of the High Court however has set aside the order of the Government refusing to make reference to the Industrial Tribunal and directed it to recon-sider the matter on the following three grounds :

(1) That the Government took into consideration the secret report which had seriously prejudiced and coloured its decision;

( 2) that in accordance with the principles of natural justice the Regional Conciliation Officer should have shown the secret report to the other members of the Conciliation Board so that they may have an opportu-nity to rebut the S'ame; and

( 3) that the Government order was based purely on the secret report sent by the Additiona~ Regional Concilia-tion Officer as also the report of the Labour Commi• ssioner.

In the aforesaid order of the Division Bench of the Hig~ Court certain mandatory directions have been given to the Government to ignore the secret report as also the report of the Labour Commissioner and to consider the reports of the other members of the Conciliation Board, namely, Shibban Lal Saxena and Mr. Arora. The Divisi<>n Bench of the High Court has, however, granted the certificate of fitness by its order doated April 9, 1973 .

Coming to the first ground which weighed with the High Court rn setting aside the order of the Government ~efusing to make reference to the Industrial Tribunal it seems to us that the High Court has pro-ceeded on complete misconception of the real position and on premise which is wrong on point of fact. Having perused the mate-rials placed before us, we fuid that there is no reliable material on the record at all to show that the Government order referred to above was based mainly on the secret report of the Additional Regional Concilia-tion Officer or of the Labour Commissioner. 1he order does not say so : it only recites that the reference to the Industrial Tribunal was refused because the Government did not think it e:tpC!!ient to make reference. The High Court, however, completely overlooked the speci-fic averment made in the counter-affidavit filed by' the Government be-fore the High Court which is at p.32 of Volume II of the Paper Book. In poaragraph-29 of this counter-affidavit; while rebutting the allegations made by the petitioner it was stated thus :

"That with respect to the contents of para 38 of the said Affidavit it is stated that the opinion of the Government that it was not expedient to refer the dispute to adjudication was formed after the matter was fully considered by the State Government. The report of the Labour Commissioner sub-nlltted through his letter No. 7241/I-CR-CB-5(147)/1955, dated 22nd October, 1955, was also before the Department concerned. true copy of the said letter of the Labour Commissioner is annexure III to this affidavit.

"The Government took the decision after considering the said report and other surrounding circumstances. It is denied that there was any discrimination against the petitioner Union. Each case was duly considered on its merits and only those cases were dropped which i>n the opinion of the Government were not fit for reference."

This averment which has not been proved to be false nmnifestly shows that the Government before making the impugned ordet had considered

[1976] 1 s.c.R.

·all the aspects including the report of the Chairman and the members of Jhe Conciliation Board, the Labour Commissioner and other surround-i:ug circumstances. In these circumstances the finding of the Division Bench of the High Court that the order of the Government was based .merely on the secret report of the Chairman or that of the Labour Commissioner is not sustainable. We fail to understand on what basis the High Court has presumed that the Government acted solely on the secret re1;ort of the Regional Conciliation Officer.

Under s. 4·K of the U.P. Industrial Disputes Act the statute con-fers the power on the Government to refer any industrial dispute if it is of the opinion that such dispute exists or that any matter is con-. nected with, or relevant to, the dispute. The Section runs as follows :

"Where the State Government is of opinion that a!,1y indus-trial dispute exists or is apprehended, it may at any time by order in writing refer the dispute or any matter appearing to be connected with, or relevant to, the dispute to Labour Court if the matter of industrial dispute is one of those con-tained in the First Schedule or to Tribunal if the matter of dispute is one contained in the First Schedule or the Second _Schedule for adjudication :

Provided that where the dispute relates to any matter spe-cified in the Second Schedule and is not likely to affect more than one hundred workmen, the State Government may, if it so thinks fit, make the reference to Labour Court."

·:This section, therefore, gives wide discretion to the State Government to act under certain circumstances. If the Government on the basis -. of the materials before it, comes to the conclusion that no real dis-pute existed and it was 11ot expedient .to make reference one can har'dlv find fault with the order of the Oovernment passed under s. 4 K of the U.P. Industrial Disputes Act. There can be no doubt that while the secret report of the Additional Regional Conciliation Officer and the report of the Labour Commissioner, like other cir-cumstances. had to be considered by the Government in making its overall assessment of the situation, there was no reason for ex-- eluding the secret report submitted by the Additional Regional Conciliation Officer at all. In these circumstances the first ground on which the Division Bench has set aside the Government order in refusin~ to refer the matter to the Industrial Tribunal is not legal-lv sound and cannot be sustained. As regards the second ground, the main contention of Mr. Gupte learned counsel for the appellant has been that the High Court was in error in applying the principles of natural justice to matter like this, and submitted that the case_s relied upon by the Single Judge of the High Court re!(arding the application of the principles of natural iustice to administrative proceedings cannot be invoked in the facts and circumstances of this case. To begin with we have to · -examine the ambit and scope of the Conciliation Board and the procedure adopted by it by virtue of the provisions contained in the

notification issued by the Government under s. 3 of the U.P. Indus-trial Disputes Act. The relevant portion of the notification runs thus :

"5. Functions of Boards al1:1 submission of Memoran-dum or Report.

( 1) Upon reference of dispute to the Conciliation Board under clause 4 it shall be its duty to endeavour to bring about settlement of the dispute, and for this pur-pose the Board shall, in such manner as it thinks fit, and without delay, investigate the dispute and all matters affect-ing the merits and just settlement thereof, and may do all such things as it thinks fit for the purpose of. inducing the parties to come to an amicable settlement.

(2) In any case where the Conciliation Board is success-ful in bringing about ah amicable settlement between the par-ties it shall prepare memorandum stating the terms of settle-ment arrived at and the Chairman shall send copies there-of to the State Government. the Laboll; Clommissioner, U.P and the parties concerned.

( 3) Where no amicable settlement can be reached on one or more than d.1e issue, the Chairman shall, within seven davs ( excludinl( holidays but not annual vacations observ-ed by courts subordinate to the High Court) of the close of the proceedinl!;s, send _to the State Government and the Labour Commissioner, full report setting forth the steps taken by the Board for ascertaining the facts and circumstances relatinl( to the dispute and for bringing about an amicable settlement thereof.

(4) The memorandum unl:ler sub-clause (2) or the report under sub-clause (3) shall be submitted by the Chairman within thirty days (excluding holidays but not annual vacations observed by courts subordinate to the High Court) of the date on which the reference was made to the Board.

Provided that the State Government may extenl:I the said period from time to time.

(5) The memorandum under sub-clause (2) or the report under sub-clause (3) shall be signed by the Chair-man and such members as may be present :

Provided that the memorandum under sub-clause (2) shall also be signed by the parties to the rlispute;

Provided that nothing in this clause shall be deemed to prevent any member of the Board from submitting dis-senting report."

[1976] 1 S.C.R.

perusal of this notification would clearly show that the jurisdiction of the Conciliation Board is very limited. The procedure pres-cribed for the Board does not involve any adjudicatory process but is purely of an exploratory nature and what the Board has to do is to make an effort to bring about an amicable settlement between the management and the workers, and if it fails to do so it has to send detailed report to the .Government. That is the limited area with• in which the Board has to function. Nevertheless it is not disputed in this case that the Conciliation Board had held full investigation in the matter, heard the parties and framed 'as many as 33 issues after ,2oing into the matter and then the Chairman and the members sent their reports. Thus before making the reports, all the rules of natural justice were fully com_plied with : the parties were given · hearing, their points of view were fully considered and in fact the representatives of the mana,2ement and· that of the labour were the members of the Boar<J.. There is no provision in the notification or in the U.P. Industrial Disputes Act which enjoins that the report submitted by the Chairman or any other members should be shown to one another. This also does not appear to be necessary. The High Court seems to think that because the Chairman did not show his secret report to the other members of the Board, this has resulted in the violation of the principles of natural justice. We are, how-ever, unable to agree with thi~ line of reasoning. The principles of natural justice are no doubt very essential but they have got their own limits and cannot be .stretched too far. We would now like to deal with some of the cases which have been referred to in the judgment of the High Court and which are also relied upon by Mr. Chowklhri, counsel for the respondents. In the first place reliance was placed on A. K. Kraipak and Ors. etc. v. Union of India and Ors. (1) where this Court observed as fol-lows :

"The aim of the rules of natural justice is to secure justice or to put it negatively to prevent miscarriage of justice. These rules can operate only Pil areas not covered by any law validly made. In other words they do not supplant the law of the land but supplement it. ... if the uuruose of the rules of natural justice is to prevent mis-carriage of justice one fails to see why those rules should be made inapplicable to administrative enquiries. Often times it is not easy to draw the line that demarcates adminis-trative enquiries from quasi-judicial enquiries."

This Court, however, took care to point out as follows :

"What particular rule of natnraJ juatice should apply to given case must depend to great extent on the facts and circumstances of that case. the framework of the law under which the enquiry is held and the constitution of the Tribunal or body of persolis appointed for that pur-pose, Whenever complaint is made before court that

some principles of natural justice _had been contmvened the court has to decid~ whether the observance of that rule was necessary for jtwt decision on the facts of that case."

The facts in Kraipak's case (supra) are quite different from the facts in the present case. In Kraipak' s case the main grievance of the oetitioner was that in the Selection Board which was constituted for recommendmg the promotion of the State Officers to the Indian Forest &rv1cc Cadre the Chief Conservator of Forests was also a. member of the Board, although he himself was also candidate for promotion to the Inili.an Forest Service· Cadre. Thus what hap-pened was that the Chief Conservator of Forests acted as Judge in his own cause. This was undoubtedly gross violation of the principles of natural justice, because the very person who stood as candidate also sat in tile Selection Board which had to dec1Je his own future as that of hi~ rivals, Such is, however, not the case here. The Conciliation Board had completed its proceedings and the stage at which, according to the High Court, the rules of natural justice had to be applied was the stage of submitting the report. Full hearing was given to the parties concerned. Thus all the indicia of the principles of natural justice were present on the facts of the present case. In these circumstances we are satisfied· that at Kmipak' s case could not be called into aid in support of the reasons given by the High Court. The procedure adopted in Kr<Upak's case was obviously so abhorrent to the notions of justice and fair-play that rules of natural justice were at once attracted.

Reliance was also placed on Union .of India v. Col. J. N. Sinha and Anr.(') where also it was pointed out by this Court:

"Whether the exercise of power conferred should be made in accordance with any of the principles of natural justice or not depends upon the express words of the pro-vision conferring the power, the nature of the power con-ferred, the puroose for which it is conferred and the effect of the exercise of that power."

In the present case we have already pointed out that neither clause ( 5) of the notification referred to above, nor s. 3 of the U.P. Indus-trial Disputes Act contairi~d any provision which required that the members of the Conciliation Board were to show their reports fo one another. AU that was required was that they should send their reports to the Government through the Labour Commissioner. This was undoubtedly done. Vf_e are, therefore, unable to see any in-fraction of fhe rules of natural iustice in fhe present case.

Reliance was Jaso placed on the decision of this· Court in State of Orissa v. Dr. (Miss) Binapani Dei and Ors.('). This ca•e also does not appear to be of anv assistance to the respondents: because in that case fhe entire procedure of inquiry held was ·in violaticin of the rules of natural justice, That, however; is not the position here.

(1) (1971] IS. C. R.791. 13-L714 SupCJ/75

(2) [1967] 2 'S. C. R. 625.

It was then contended by Mr. Gupte that after quashing the order of the Government refusing to make reference and asking it to re-consider the same it was not open to the High Court to have given peremptory directions so as to circumscribe the statutory jurisdiction of the Government under s. 4-K of the U.P. Industrial Disputes.Act. In our opi.1ion this contention is well-founded and must prevail. Even if the High Court thought that the impugned order of the Government 'u!J'ercd from any legal infirmity all that it could have done was to have asked the Government to reconsider it but it had no jurisdiction lo direct the Government how to act •and how to exercise its stalutor) discretion which was conferred on it by s. 4-K of the U.P. Industrial Disputes Act. There! was absolutely no warrant for the High Court in prohibiting the Government from considering the secret report of the Additional Regional Conciliation Officer or that of the Labour Commi-;sioner. The Government was fully entitled to consider the matter in all its comprehensive aspects and the secret report of the Chairman of the C<Y,1cilintion Board or that of the Labour Commissioner were un-doubtedly relevant materials which the Government could have consi-dc-red. The High Court could not debar the Government from consi-dering those matters nor could it compel the Government to exercise its discrctipn in particular manner. Jn these circumstances we arc satisfied that the order of the High Court is ·,10t legally sustainable ancl must be quashed.

The other point which arises for considcralio·a is as to the relic!' which could be granted lo the appellant. Mr. Guptc, counsel for the appellant, submitted that after the judgment of the High Court the: Government had passed another order dated February 6, 1973, by which it. has in consonance with the directions given by the High Couf'. made reference to the h1tlustrial Tribunal. It was submitted th'Jc it was not 'Jt all proper for the Government to have revived dead issue after more than twenty years and further as the order of the Guvcrnment was based on the order of the High Court, if the order or the High Court was qU'ashed the order of the Government making reference to the Industrial Tribunal would fall automatically. We find ourselves in agreement with tho learned coun~~I for the appellant. There C\lll be no doubt that the order of the Government dated Feb-ruary 6, 1973 is undoubtedly based on the order passed by the Division Hench of the High Court. This is proved by letter written by Mr. Vishnu Prakash Up Sachiv (Deputy Secretary), U.P. Government, t" • the Manager of the appellant Mills. The. relcva,il portion of the letter after being translated in English runs thus :

"I am directed to say that their Lordships of the High Court in their Judgment in Special Appeal No. 1963/915 State Vs. Shri Shiban Lal Saxena (M/s. Mahabir Jute Mills Sabjanwa) have ordered that the Government aftN taking the dis~nting reports from both the parties should consider on the question whether the aforesaid dispute should be referred for adjudication.

Therefore you arc requested that within 10 days from the dale ·~f the receipt of this letter to send your dissenting re-

I : _....

port and whether further you want to say 011 your behalf to the Government.

perusal of this letter clearly shows that the Government did not exercise its independent decisioa under s. 4-K of the U.P. Industrial Disputes Act but was guided mainly by the judgment of the High Court and the directions given in Special Appeal flied in the High Court. IE the order of the High Court is quashed, then it will undoubtedly mate-rially affect the decision of the Government in making reference to the Industrial Tribu.ial. Had the Government made the reference uninlluenccd by the High Court's directions the legal situation would have been different.

The learned counsel for the respondents submitted that no prayer was made by the appellant for quashing the order of the Government for making refere'ace to the Industrial Tribunal. It wa>, however, not necessary for the appellant to make such prayer because if the High Court's order is quashed, then any subsequ~nt proceeding which comes into existence as result of the High Court's order would fall to the ground as logical corollary of our finding. The ]C'arned counsel for the respondents after due consideratio'.1 submitted that he would have no objection if the Government order for making a. refe_rcnce is quashed provided the Government's discretion to make afresh reference to the Industrial Tribunal on the dispute is not fettered. We would.· however, like to make it clear that the Govcrnme'at has •ample discre-tion to make reference to the Industrial Tribunal under s. 4-K of the U.P. Industrial Disputes Act if it so thinks fit. This Court in Western India Match Company Ltd. v. Western India Match Co. Workers Union and Others([1]) clearly held that even if rcfereacc was refused by the Government tlmt will not debar the Government from making reference at later time if it is satisfied that in tlic changed circumstances reference is necessary. For the reasons given above, we allow the appeal, quash the order of the High Court dated April 9, 1973 a"1d us ccmsequencc of this we also set aside the order of the Government dated February 6, 1973 for making reference to the Industrial Tribunal. In the peculiar circumstances of t11is case, however. we make no order as to costs 1hro.ughout.

:l'.H.P.

Appeal 11//o""'d.