PONDICHERRY KHADI AND VILLAGE INDUSTRIES BOARDversusP. KULOTHANGAN AND ANR.

A       PONDICHERRY KHADI AND VILLAGE INDUSTRIES BOARD
                              v.
                   P. KULOTHANGAN AND ANR.

                               OCTOBER 31, 2003

B             [RUMA PAL AND P. VENKATARAMA REDDI, JJ.]


         Industrial Disputes Act, 1947:

          Labour Court-Principle of res judicata-Applicability of-Temporary
C   employee-Absentedfrom duty-Not allowed to continue on work-Writ petition
    and writ appeal by employee dismissed-Thereafter employee raising industrial
    dispute-labour Court directing his reinstatement-Held, industrial dispute
    raised by employee after having got an adverse order in writ proceedings was
    barred by principles of res judicata-Code ofCivil Procedure, 1908-Section
D   II.

           The respondent, a temporary employee, after having remained
    absent for sometime, sought to rejoin his duties, but the appe!lant-
    employer did not allow him to do so. His writ petition before the Single
    Judge of the High Court for a direction to the appellant to take him back
E   on the work as also for regularisation of his services was dismissed. The
    writ appeal filed by him was also rejected. Thereafter, the respondent
     raised an industrial dispute before the Labour Court, which inspite of the
    fact of the earlier litigation having been brought to its notice, directed his
     reinstatement. The award of the Labour Court was unsuccessfully
F   challenged before the Single Judge as also the Division Bench of the High
    Court. The plea of the employer that since the issue had already been
    decided by the High Court in earlier writ proceedings, its fresh
    adjudication by the Labour Court was barred by the principle of res
    judicata, was not accepted. Aggrieved, the employer filed the present
    appeals.
G
          It was contended for the respondent that the principle of res judicata
    was not applicable as the issue raised in the earlier writ petition was one
    of regularization and not of reinstatement.

          Allowing the appeals, the Court
H
                                          62
         PON DIC HERRY KHADI AND VI LL. INDUS. BOARD v. P KULOTHANGAN        63

      HELD: 1.1. The industrial dispute pertained to the same subject              A
matter dealt with in the earlier writ proceedings and was barred by the
principles of res judicata. In view of s.I 1 of the Code of Civil Procedure,
1908, the High Court erred in upholding the award of the Labour Court.
                                                                (66-D; 67-E)

      Workmen v. Straw Board Mfg. Co., AIR (1974) SC 1132 and State of             B
U.P. v. Nawab Hussain, (1977) 2 SCC 806, relied on.

      1.2. The principle of res judicata operates on the court. It is the courts
which are prohibited from trying the issue which was directly and
substantially in issue in the earlier proceedings between the same parties,        C
provided the court trying the subsequent proceeding is satisfied that the
earlier court was competent to dispose of the proceedings and that the
matter had been heard and finally decided by such court. [66-G; 67-A)

      1.3. In the instant case, parties to the writ petition filed by the
respondent in the High Court as also the industrial dispute were the same.         D
The cause of action in both was the refusal of the appellant to allow the
respondent to rejoin service. The High Court was competent to decide the
issue which it did with a reasoned order on the merits and after a contested
hearing. The "lesser relief' of reinstatement which was the subject matter
of the industrial dispute had already been claimed by the respondent in            E
the writ petition. This was refused by the High Court. The correctness of
the decision in the writ proceedings was not challenged by the respondent.
The decision, was, therefore, final. Having got an adverse order in the
writ proceedings, it was not open to the respondent to re-agitate the issue
before the Labour Court and the Labour Court was incompetent to
entertain the dispute raised by the respondent and re-decide the matter            F
in the face of the earlier decision of the High Court. [67-A-DI

       Workmen of Cochin Port Trust v. Board of Trustees of the Cochin Port
Trust and Anr., (1978) 3 SCC 119 and Smt. Pujari Bai v. Madan Gopal (dead)
L. rs. AIR, [1989) SC 1764, distinguished.                                         G
     CIVIL APPELLATE JURISDICTION : Civil Appeal No. 8537 of2003.

     From the Judgment and Order dated 21.9.2001 of the Madras High
Court in W.A. No. 1541 of 1997.
                                                                                   H
                                    WITH
    64                       SUPREME COURT REPORTS (2003] SUPP. 5 S.C.R.

A        C.A. No. 8538 of 2003

         T.L. Viswanath Iyer and V.G. Pragasam for the Appellants.

         K. Ram Kumar and B. Sridhar for the Respondents.

B        The Judgment of the Court was delivered by

          RUMA PAL, J. Leave granted. The respondent was appointed in 1983
    as an Instructor on a temporary basis by the appellant. Between 19th May,
    1986 to 16th June, 1986, the respondent failed to turn up for duty. According
C   to the respondent this was because of communal clashes which had broken
    out in the respondent's village. According to the appellant, the respondent
    had merely absconded because of a complaint filed by one of the ladies
    working in the appellant's units against the respondent. Whatever the truth,


D
    the fact remains that when, after the period of absence, the respondent sought
    to rejoin his duties, he was not allowed to do so by the appellant.              ..
          The respondent then filed a writ petition before the High Court at
    Madras on 16th September, 1986 in which he .claimed inter a/ia that he had
    been wrongfully refused employment by the appellant when he sought to
    rejoin. By way of interim relief, he prayed that he should be permitted to
E   continue to work on the same terms and conditions. The substantive prayer
    in the writ petition was for a direction on the appellant to regularise the
    respondent's service. The writ petition, which was contested by the appellant,
    was dismissed by an order dated !st December, 1986. However, since 18
    posts for permanent instructors had been advertised, leave was granted to the
    respondent to approach the appellant for appointment on the basis of his
F   earlier temporary service.

          The respondent applied for such appointment and also preferred an
    appeal from the order of the Single Judge dismissing his writ petition. It was
    contended before the Appellate Court that the respondent's service could not
G   be terminated without a disciplinary enquiry. A grievance was also made that
    the Single Judge should have atleast directed the appellant to permit the
    respondent to continue in his temporary appointment.

          The writ appeal was dismissed by the Division Bench of the High            ...
    Court which held that the respondent was neither entitled to regularisation
H   nor to reinstatement as the appointment of the respondent was a temporary
    one pending sanction of permanent posts and that the appellant Board could
      PONDICHERRY KHADI AND VILL. INDUS. BAORDv. P. KULOTHANGAN [RUMA PAL, J.) 65

    make recruitment only in accordance with the statutory rules. While dismissing      A
    the appeal, the Appellate Court recorded the statement of the counsel for the
    appellant that the respondent's application for appointment pursuant to the
    advertisement issued by the appellant for permanent appointment would be
    considered on its own merits. The respondents' s application for appointment
    was, however, rejected by the appellant.
                                                                                        B
          The respondent then raised a dispute under the industrial Disputes Act
i
    1947 challenging the termination of his service. Jn the counter statement filed
    by the appellant before the Labour Court, apart from countering the
    respondent's claim, the facts relating to the previous litigation initiated by
    respondent were set out in detail. Despite noting the filing of the writ petition   C
    by the respondent and its dismissal, the Labour Court allowed the respondent's
    complaint holding that the respondent's services had been wrongfully
    terminated. The Labour Court accordingly directed the reinstatement of the
    respondent in service with full back wages and other attendant benefits.

           The appellant challenged the Award of the Labour Court by way of a D
    writ petition before the Madras High Court, inter a/ia, on the ground that the
    decision of the High Court in the previous litigation between the parties was
    final and binding and that the second respondent could not raise the same
    dispute before the Labour Court, such fresh adjudication being barred by the
    principles of res judicata. This submission was in addition to the submission
    that the Award was otherwise incorrect since the respondent held a temporary E
    post, that the permanent post had since been advertised and filled by duly
    appointed selectees and that there was no question of the respondent being
    either reinstated or directed to be paid any back wages. The writ petition was
    dismissed by the Learned Single Judge without adverting to any of the
    contentions of the appellant and for no decipherable reason. The Learned F
    Single Judge also directed the appellant to create a supernumerary post to
    accommodate· the respondent within 30 days within which period the
    respondent was to be paid all dues in terms of the Court's order. The appellant's
    appeal to the Division Bench was dismissed not only on merits but also by
    rejecting the appellant's submission that the proceedings before the Labour
    Court were barred by res judicata. The appellant filed an application for G
    review of the decision of the Division Bench. This application was rejected
    by the High Court. The appellant has impugned the rejection of the writ
    appeal as well as the order rejecting its application for review by two separate
    special leave petitions.
                                                                                        H



                                                                                            I
    66                           SUPREME COURT REPORTS [2003) SUPP. 5 S.C.R.

A         Although .the appellant had compli~d with the provisions of Section
    17-B of the Industrial Disputes Act, 1947 since the Award of the Labour
    Court, the respondent was not reinstated nor were the directions of the high
    Court complied with. The contempt proceedings initiated by the respondent
    by reason thereof have been stayed by this Court.

B          Before us, the appellant has reiterated its stand before the High Court
    both on the question of res judicata as well as on merits. The respondent has,
    on the other hand, submitted that even if he was a temporary employee,
    nevertheless the appellant's refusal to permit him to join was based on
    allegations of alleged misconduct and that therefore the appellant could not
C   have terminated his service without holding an enquiry and without giving
    the respondent an opportunity of being heard. On the question of res judicata,
    it is submitted that the principle will have no application since the issue
    raised in the earlier writ petition was one of regularisation and not of
    reinstatement.

D           In our opinion, the appellant has correctly contended that the industrial
     dispute pertained to the same subject matter dealt with in the earlier writ
    proceedings and was barred by the principles of res judicata. It is well
    established that although the entire Civil Procedure Code is not applicable to
     industrial adjudication, the principles of res judicata laid down under Section
     I I of the Code, are applicable 1 including the princip1es of constructive res
E   judicata. Thus in State of U.P. v. Nawab Hussain'-, it was held that the
     dismissal of a writ petition challenging disciplinary proceedings on the ground
    that the charged officer had not been afforded reasonable opportunity to meet
    the allegations against him, operated as res judicata in respect of the subsequent
     suit in which the order of dismissal was challenged on the ground that it was
p    incompetently passed. This Court also held:

             " .... it may be that the same set of facts may give rise to two or more
             causes of action. If in such a case a person is allowed to choose and
             sue upon one cause of action at one time and to reserve the other for
             subsequent litigation, that would aggravate the burden of litigation.
G            Courts have therefore treated such a course of action as an abuse of
             its process". (p.808)

           The principle of res judicata operates on the Court. It is the Courts
     I.   Workmen v. Straw Boord Mfg. Co., AIR (1974] SC 1132, 1140.

H   2.    [197712 sec 806.
     PONDICHERRY KHADI AND VILL. INDU~ BORADv. P KULOTHANGAN [RUMA PAL,J.] 67

 which are prohibited from trying the issue which was directly and substantially   A
 in issue in the earlier proceedings between the same parties, provided the
 Court trying the subsequent proceeding is satisfied that the earlier court was
competent to dispose of the earlier proceedings and that the matter had been
heard and finally decided by such Court. Here the parties to the writ petition
filed by the respondent in the Madras High Court and the industrial dispute        B
were the same. The cause of action in both was the refusal of the appellant
to allow the respondent to rejoin service. The Madras High Court was
competent to decide the issue which it did with a reasoned order on the
merits and after a contested hearing. This was not a case where the earlier
proceedings had been disposed of on any technical ground as was the case
in Workmen of Cochin Port Trust v. Board of Trustees of the Cochin Port            C
Trust and Anr., 3; Smt. Pujari Bai v·. Madan Gopal (dead) L.Rs. 4 • The "lesser
relief' of reinstatement which was the subject matter of the industrial dispute
had already been claimed by the respondent in the writ petition. This was
refused by the High Court. The correctness of the decision in the writ
proceedings has not been challenged by the respondent. The decision was,           D
therefore, final. Having got an adverse order in the writ petition, it was not
open to the respondent to re-agitate the issue before the Labour Court and
the Labour Court was incompetent to entertain the dispute raised by the
respondent and re-decide the matter in the face of the earlier decision of the
High Court in the writ proceedings.
                                                                                   E
      We are, therefore, of the opinion that the High Court erred in upholding
the award of the Labour Court having regard to Section 11 of the Code of
Civil Procedure. In this view of the matter, it is not necessary for us to
consider the other contentions raised by the appellant. The appeals are
accordingly allowed and the decision of the High Court as well as the Award
of the Labour Court are set aside. However, the appellant will not recover         F
any amount that may have been paid to the respondent under the provisio$1s
of Section 17-B of the Industrial Disputes Act, 1947. There will be no order
as to costs.

R.P.                                                        Appeals allowed.




3.     [197813 sec l 19.

4.     AIR (t 989] sec l 764.