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Judicial Review of Awards under Articles 136 of the Constitution

In 1956, a new provision, Section 10A, was added to the Industrial Disputes Act of 1947 providing an option to the parties to refer their industrial dispute to an arbitration of their choice.

Voluntary reference of dispute to Arbitration:

(1) Where any industrial dispute exists or is apprehended and the employer and the workmen agree to refer the dispute to arbitration, they may, at any time before the dispute has been referred under Section 10 to a Labour Court or Tribunal or National Tribunal, by a written agreement, refer the dispute to arbitration and the reference shall be to such person or persons (including the presiding officer of a labour court or tribunal or national tribunal) as an arbitrator or arbitrators as may be specified in the arbitration agreement.

(2) An arbitration agreement referred to in sub-section (1) shall be in such form and shall be signed by the parties thereto in such a manner as may be prescribed.

(3) A copy of the arbitration agreement shall be forwarded to the appropriate Government and the conciliation officer and the appropriate Government shall, within fourteen days from the date of the receipt of such copy, publish the same in the official Gazette.

(4) The arbitrator or arbitrators shall investigate the dispute and submit to the appropriate Government the arbitration award signed by the arbitrator or all the arbitrators, as the case may be.

(5) Nothing in the Arbitration Act, 1940, shall apply to arbitrations under this section.

The question arises whether a decision of an Arbitrator is subject to Judicial Review

Recently, the Supreme Court has, in Engineering Mazdoor Sabha v. Hind Cycles Ltd.[1], held that an arbitration under section 10A of the Act is not a tribunal for the purpose of Article 136 of the Constitution. Hence the Court cannot entertain an appeal under Article 136 from a decision of the "arbitrator".

For invoking Art. 136 (1) two conditions must be satisfied. First, the proposed appeal must be from a judgment, decree, determination, sentence or order (it must not be against purely executive or administrative order) i.e., the determination or order should be a judicial or quasi- judicial determination or order. Secondly, the said determination or order must have been made or passed by any court or tribunal in the territory of India. Regarding first, it is beyond controversy that an award of an arbitrator under section 10A is a quasi-judicial act. The Supreme Court in the instant case has also conceded " that the decisions of the arbitrators to whom industrial disputes are voluntarily referred under S. 10A of the Act are quasi- judicial decisions and they amount to determinations or orders under Article 136(1).

The real controversy hangs on the second, i.e., whether an arbitration under Section 10A is a tribunal. As to the requisites of a tribunal the court stated in the Engineering Mazdoor Case[2]: "The Tribunals which are contemplated by Art. 136 (1) are clothed with some of the powers of the Courts. They can compel witnesses to appear, they can administer oath, they are required to follow certain rules of procedure, the proceedings before them are required to comply with the rules of natural justice, they may not be bound by the strict and technical rules of evidence, but nevertheless, they must decide on evidence, adduced before them; they may not be bound by other technical rules of law, but their decisions must, nevertheless, be consistent with the general principles of law. In other words, they have to act judicially and reach their decisions in an objective manner and they cannot proceed purely administratively or base their conclusions on subjective tests or inclinations.

The qualifications of a tribunal for the purpose down by the Supreme Court in the passage quoted by the 'arbitrator' under S. 10A of the Act. Section 10A is also clothed with some of the powers compel witnesses to appeal, administer oath, follow certain rules of procedure and natural judicially and he decides a dispute objectively. The has further pointed out that " having regard contained in the Act and the rules framed thereunder, appointed under S. 10A cannot be treated to private arbitrator to whom a dispute has been arbitration agreement under the Arbitration Act, be possible to describe such an arbitrator, as statutory arbitrator.
after the decision of the Supreme Court in Bharat Bank Ltd v. Employees of Bharat Bank Ltd. it was established that the order and awards of industrial adjudicators are subject to judicial review by the Supreme Court directly under the special leave appellate jurisdiction under Art. 136 of the Constitution. In this case the Supreme Court held that the ad judicatory authorities under the Act would fall within the meaning of the term “tribunal” in Art. 136 of the Constitution, as these authorities have “all the trappings of a court” and “perform functions which cannot but be Regard as judicial.”

The court lends support to the view of the High Courts, that a writ under Art. 226 lies to an arbitrator functioning under Section 10A of the Act though it did bay High Court with regard to Art. 227. However, it us refused to entertain the appeal under Art. 136 on the ground that is wider than Art. 136 of the Constitution. "In our opinion art 226 which is writ of certiorari can be issued in an appropriate case, is in an Art. 136, because the power conferred on the High certain writs is not conditioned or limited by that the said writs can be issued only against or tribunals. Under Art. 226(1), an appropriate to any person or authority, including in appropriate government, within territories prescribed. Therefore, arbitrator appointed under S. 10A is not a tribunal in a proper case, a writ may lie against his 226 ".

But even a statutory arbitrator, according to does not fulfil the requirement of a tribunal Art. 136. What is more fundamental to constitute meaning of Art. 136, on which the court has finally should be constituted by the State and should be invested with the States' inherent judicial power". It would mean that " a distinction lies between judicial power on the one hand and judicial conduct in the arbitral power on the other ". The main hurdle in treating the arbitrator under S. 10A as a tribunal, according to the Court, is that he is appointed by the agreement of the parties and he derives his power to adjudicate from that agreement of the parties whereas industrial tribunals derive it from the statutory provisions themselves.

Although it is true to some extent that the arbitrator under section 10 A derives his power of adjudication from an agreement of the parties, yet once appointed he functions and adjudicates within the framework of the Industrial Disputes Act and is bound by the provisions of the Act and the rules framed thereunder. The only difference appears to be that he is not paid by the State. The Supreme Court has relied on the observation of Mahajan, J., in Bharat Bank case [3]that "the condition precedent for bringing a tribunal within the ambit of Art. 136 is that it should be constituted by the State', and "a tribunal would be outside the ambit of Art. 136 if it is not invested with any part of the judicial function of the State but discharges purely administrative and executive duty". In fact, in Bharat Bank case, the Court was only pointing out the difference between tribunal exercising judicial functions and tribunal exercising purely administrative and executive functions. It may be pointed out that under Section 10A sub-clause (5), the Arbitration Act, 1940, does not apply to arbitration under Section 10A. That provision was made intentionally by the legislature to treat the award of an arbitrator and that of a tribunal on the same footing and for that purpose Section 2 (a) was amended to include an award of the arbitrator functioning under S. 10A of the Act into the definition of Award. But the Court seems to suggest that the legislature by incorporating S. 10A (5) wanted to treat arbitration proceedings something distinct from tribunal proceedings.

End-Notes
[1] 1962- II- LL. J. 760 (S.C)
[2] 1963 AIR 874
[3] Bharat Bank v. Employees ' of Bharat Bank, A.I.R. 1950 S.C 188

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