Bharat Bank Ltd. v. Employees

FACTS

• Bharat Bank Limited faced an industrial dispute with its employees, leading to a strike in 1949.

• The Central Government formed a Tribunal under Section 7 of the Industrial Disputes Act, 1947, to adjudicate the dispute.

• After the Tribunal issued its award, the Bank sought Special Leave to Appeal against the award to the Supreme Court under Article 136 of the Constitution.

• Preliminary Objection: The respondents (employees) and the Central Government argued that the Industrial Tribunal did not exercise the judicial powers of the State and its determination was not a "judgment, decree, or order", thus placing it outside the scope of Article 136.

• This was the first case where special leave was granted from the determination of an Industrial Tribunal, making the definition of "Tribunal" under Article 136 the central constitutional question.

ISSUES

1. Jurisdiction: What construction should be put upon Article 136 with reference to the words "Tribunal" and "determination" occurring therein, and whether the language is wide enough to include the adjudication and award of an Industrial Tribunal.

2. Nature of Function: Whether the award of an Industrial Tribunal is a judicial decision or the pronouncement of an administrative or quasi-judicial body.

3. Validity of Award: Whether an award signed by only two members of the Tribunal (as against three who heard the case) was valid.

JUDGEMENT

The Supreme Court delivered a landmark 3:2 majority judgment:

• Appealability (Jurisdiction): The majority (Fazal Ali, Mahajan, and Kania C.J.) held that the Industrial Tribunal possesses all the necessary attributes of a court of justice and, as such, comes within the ambit of the word "Tribunal" in Article 136 of the Constitution. Therefore, an appeal can be entertained and granted against the decision of an Industrial Tribunal.

• Merits: The award was quashed on procedural grounds (impliedly due to the issue of the award being signed by only two members) and directed the Tribunal to readjudicate Item 18 of the reference and submit its award to the Government.

OBSERVATION & CONSTITUTIONAL STATUS

The majority judgment is monumental for defining the constitutional status of industrial adjudication in India:

1. Industrial Adjudication is Judicial in Nature (Majority View)

• Kania C.J. and Fazal Ali J.: Although the powers of the Industrial Tribunal are different from an ordinary Civil Court (e.g., ordering reinstatement which a Civil Court cannot do), in the discharge of its duties, it is essentially working as a judicial body.

• Mahajan J.: Ruled that whenever a Tribunal determined a matter in a judicial manner, such a determination falls within Article 136. The word "Tribunal" in Article 136 was used liberally and not in the strict sense of a Court.

2. Function is Legislative/Administrative (Dissenting View)

• Mukherjea J. (Dissenting): Argued that the function of the Tribunal is not confined to the administration of justice in accordance with law. It can create new rights and obligations between parties (e.g., settling disputes and industrial peace).

• The process employed is "rather an extended form of the process of collective bargaining and is more akin to administrative than to judicial function."

3. Scope of Article 136

• The Court held that when exercising power under Article 136, the Supreme Court is not merely a Court of error. Its extraordinary powers are exercised in rare and exceptional cases and generally used to ensure that the Tribunal proceeded within the powers conferred on it and approached the adjudication of the dispute according to principles of natural justice.