BOKAJAN CEMENT CORPORATION EMPLOYEES' UNIONversusCEMENT CORPORATION OF INDIA LTD.

A
         BOKAJAN CEMENT CORPORATION EMPLOYEES' UNION
                                        V.

                  CEMENT CORPORATION OF INDIA LTD.

                             NOVEMBER I0, 2003
B
                [Y.K. SABHARWAL AND B.N. AGRAWAL, JJ.]


         Labour Laws :

C         Trade Union Act, 1926-Sections 6 and 22-Constitution of Bokajan
    Cement Corporation Employees' Union-Clauses 5, 6(e) and 9-Trade Union-
    Membership-Cessation of-Whether depends upon cessation ofemployment-
    He/d: No-There is no provision in the Act or the Constitution of the Trade
    Union providing for automatic cessation of membership on cessation of
D   employment-The Act and the Constitution deserve to be interpreted so as to
    advance the interest of the Trade Union and its members.

          Single Judge of High Court held that an employee would not lose
    his right to continue as a member of a trade union as a result of cessation
    of his employment. However, Division Bench of High Court, on appeal,
E   relying on Section 6 of Trade Union Act, 1926 and Clause S of Constitution
    of Bokajan Cement Corporation Employees' Union held that the
    membership continues so long as the employee is actually employed.' Hence
    the present appeal

         Allowing the appeal, the Court
F
        HELD : I. There is no provision in Trade Union Act or the
  Constitution ofBokajan Cement Corporation Employees' Union providing
  for automatic cessation of membership on cessation of employment. Apart
  from clause 9 of the Constitution, there is no other clause which provides
  for cessation of the membership of the trade union. It is not the case of
G the respondent that the member in question ceased to be member of the
  trade union having suffered disqualification under clause 9. Clause 9 does
  not stipulate cessation of memberships on cessation of employment. In view
  of the provisions in the Constitution of the trade union and in absence of
  any provision providing for cessation of membership as a result of

H                                      400
    BOKAJANCEMENTCORPN. EMPLOYEES' UNION•. CEMENTCORPN.OFINDIALTD. [SABHARWAL,   1.140 I

cessation of employment, it cannot be held that an employee would cease                    A
to be a member of the trade union on termination of his employment.
                                                (406-A; 405-D-E; 406-8)

      2. Clause 5 of the Constitution is also not a provision which provides
for the circumstances under which member would lose his membership.
It provides eligibility/conditions for becoming member of the union. The                   B
expression 'throughout' in clause 5 only shows that all through the said
eligibility condition will continue. (404-G; 405-B)

      3. The Constitution of a trade union is not required to be construed
as a statute. It deserves to be construed broadly and liberally. The Act
and the Constitution of the trade union, unless clearly stipulate otherwise,               C
deserve to be interpreted so as to advance the interest of the trade union
and its members. The membership of a trade union is a valuable right
which can be taken away only within clear parameters of the Act and the
Constitution of the trade union. (404-E-F)

     State Bank of India Staff Association and Anr. v. State Bank of India D
and Ors., [1996) 4 SCC 378, distinguished.

     CIVIL APPELLATE JURISDICTION: Civil Appeal No. 2419 of2001.

     From the Judgment and Order dated 8.10.99 of the High Court Gauhati
in W.A. No. 122/96 in C.R. No. 2329 of 1994.                                               E
     P.K. Goswami and Rajiv Mehta for the Appellant.

      V.R. Reddy and S.V. Deshpande for the Respondent.

     The Judgment of the Court was delivered by                                            F
      Y.l(. SABHARWAL, J. The short question for determination in this
matter is whether an employee
                          ,     as a result of cessation of employment would
lose his right to continue as a member of the trade union. The High Court,
by the impugned judgment, reversing the decision of a single judge, has
answered the question in the affirmative. The union is the appellant.                      G
      The High Court has held that the right to continue as a member of the
trade union continues so long as an employee is actually employed. For its
conclusion, the reliance has been placed by the High Court on. Section 6 of
the Trade Union Act, 1926 (for short, "the Act") and clause 5 of the
Constitution of Bokajan Cement Corporation ·Employees' Union. The High H
    402                     SUPREME COURT REPORTS [2003] SUPP. 5 S.C.R.

A Court has held that the membership of a trade union is not a benefit that
    accrues to the employee so as to claim its continuance even after he ceases
    to be in employment; his right continues so long as he remains employed and
    on cessation of employment, membership of trade union ceases.

          There is no specific provision in the Act which provides for automatic
B cessation of membership of the trade union on an employee on cessation of
    his employment. There is also no specific clause in the Constitution of the
    appellant union which provides for such automatic cessation. Learned counsel
    for the respondent, however, places strong reliance on Section 6 (e) of the
    Act and clause 5 of the Constitution of the trade union to support the impugned
C   judgment.

          Let us first look at some provisi.ins of the Act.

          Section 2(h) defines the expression 'trade union'. It reads :

            "'Trade union' means any combination, whether temporary or
D           permanent, formed primarily for the purpose of regulating the relations
            between workmen and employers or between workmen and workmen,
            or between employers and employers, or for imposing restrictive
            conditions on the conduct of any trade of business, and includes any
            federation of two or more Trade Unions:
E           Provided that this Act shall not affect-

            (i) any agreement between partners as to their own business;

            (ii) any agreement between an employer and those employed by him
            as to such employment; or
F
            (iii) any agreement in consideration of the sale of the goodwill of a
            business or of instruction in any profession, trade or handicraft."

        "Registered Trade Union" means a trade union registered under the Act
  (Section 2(e)). The mode of registration is provided in Section 4. Every
G application for registration of a trade union is required to be accompanied by
  a copy of the rules of the trade union and a statement of the particulars as
  provided in Section 5 of the Act. Section 6, inter a/ia, provides that a trade
  union shall not be entitled to registration unless rules thereof provide for the
  matters enumerated in clauses (a) to Q). For present purposes clause (e) is
  relevant. Section 6(e) reads as under:
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     BOKAJANCEMENTCORPN. EMPLOYEES' UNION'· CEMENTCORPN. OF INDIA LTD. [SABHARWAL, J.]   403
        "The admission of ordinary members who shall be persons actually                       A
        engaged or employed in an industry with which the Trade Union is
        connected and also the admission of the number of honorary or
        temporary members as (office-bearers) required under section 22 to
        form the executive of the Trade Union."

      Section 22, inter a/ia, provides that not less than one-half of the total                B
number of the office-bearers of every registered trade union in an unrecognized
sector shall be persons actually engaged or employed in an industry with
which the trade union is connected.

      It is, thus, clear that the rules of the trade union have to provide for the
admission of ordinary members who shall be persons actually engaged or                         C
employed in an industry with which the trade union is connected, and also
the admission of the member of honorary or temporary members as office
bearers required under Section 22 to form the executive of the trade union.
The Constitution of trade union has, inter alia, to comply Section 6(e) so as
to seek registration under the Act.                                                            D
      Mr. Reddy, learned counsel for the respondent contents that the words
'actually engaged or employed' would become redundant if an employee can
continue as a member of a trade union even after cessation of employment.
The contention is that on cessation of employment, it cannot be said that the
employee is actually engaged or employed in the industry and, therefore,                       E
such an employee ceases to be an ordinary member as a result of employment.

      In order to appreciate the contention of Mr. Reddy, it is also necessary
to examine the relevant provisions of the Constitution of the appellant trade
union.
                                                                                               F
     Clause 5 of the Constitution of the trade union reads as under:

       "Membership: Any worker employed by the Cement Corporation of
       India Ltd., directly or indirectly throughout shall be eligible for the
       membership of the Union provides he/she accepts the constitution,·
       Bye-laws and discipline of the Union and pays the stipulated admission G
       fee of Re. 1.00 along with stipulated subscription."

    Clause 9 of the Constitution which provides for the cessation of
membership reads as under:

                                                                                               H
    404                     SUPREME COURT REPORTS (2003] SUPP. 5 S.C.R.

A         "OBLIGATIONS:

           (i)    A member, who fails to pay 3 months' subscription continuously
                 shall cease to be the member of the union.
           (ii) The Union shall remove from the Membership Register the names
                 of those who have died withdrawn from the Union and ceased to
B                be members of the Union under any provisions of the Constitution.
           (iii) · A person who ceases to be member of the Union shall forthwith
                 be disqualified from exercising the right of a member and shall
                 have no claim on funds and benefits of the Union.
C          (iv) Any member losing validity of his/her membership as per
                provision vi de Sub-section (ii) of this Section, shall be readmitted
                on payment of Rs. 2 (Two) only as re-admission fee plus the
                usual subscription for the month in which he is readmitted subject
                to the approval of the Executive Committee of the Union."

D        Relying upon the aforesaid clause 5 and laying great emphasis on the
    word 'throughout' therein, it is contended by Mr. Reddy that continuing in
    employment all through so as to remain a member of the trade union has
    been clearly provided in the Constitution and, therefore, on discontinuance of
    employment, the membership of trade union would automatically cease.

E          The Constitution of a trade union is not required to be construed as a
    statute. It deserves to be construed broadly and liberally. The Act and the
    Constitution of the trade union, unless clearly stipulate otherwise, deserve to
    be interpreted so as to advance the interest of the trade union and its members.
    The membership of a trade union is a valuable right which can be taken away
F   only within clear parameters of the Act and the Constitution of the trade
    union.

          Clause 5 is also not a provision which provides for the circumstances
    under which a member would lose his membership. It provides eligibility/
    conditions for becoming member of the union. Regarding Section 6(e) its
G   only effect is that the rules of a trade union have, inter alia, to provide for
    the admission of those who are actually engaged or employed in industry as
    ordinary members so as to entitle a trade union to seek registration under the
    Act. Section 6( e) does not provide that on cessation of employment, an
    employee would cease to be a member. On aspect of cessation of membership
    of the trade union, the trade union can make a provision in its Constitution.
H
    BOKAJAN CEMENT CORPN. EMPLOYEES' UNION''· CEMENT CORPN. OF INDIA LTD. [SABHARWAL. J]   40 5

 It is one thing to say that the Constitution of trade union shall provide that A
 those actually engaged or employed would be entitled to be admitted as
 members of the trade union and it is altogether different thing to say that they
 would cease to be members once they are not actually engaged or employed.
 The latter is not what Section 6(e) contemplates. Likewise, clause 5 of the
Constitution of the trade union provides for all workers employed by the
Cement Corporation of India directly or indirectly throughout to be eligible B
for the membership of the trade union on acceptance of the other part of the
said clause. The expression 'throughout' in clause 5 only shows that all
through the said eligibility condition will continue. Again clause 5 is not a
provision for cessation but is a provision for eligibility to become a member.
As already stated, these clauses are not required to be construed as a statute. C
The apprehension of Mr. Reddy that non-acceptance of his contention would
result in a situation of 'once a member-always a member', is not of any
significance since that depends upon the Constitution of a trade union. If a
trade union accepts that once a mem~er would always continue to be a
member, there is nothing in the Act which mitigates against it. A trade union
niay provide under which circumstances a member would lose the membership. D
Apart from clause 9 reproduced earlier, there is no other clause which provides
for cessation of the membership of the trade union. It is not the case of the
respondent that the member in question ceased to be member of the trade
union having suffered disqualification under clause 9. Clause 9 does not
stipulate cessation of memberships on cessation of employment. Further, E
Section 15 of the Act permits a trade union to spend its funds on the
unemployment of its members. Section 15 of the Act, inter alia, provides that
the general funds of a registered trade union shall not be spent on any other
objects than ... (f) allowances to members or their dependents on account of
death, old age, sickness, accidents or unemployment of such members. Clause
11 of the Constitution of the trade union in question contemplates the F
application of the funds of the union for all or any of the purposes as envisaged
in Section 15 of the Act provided that the total expenditure in any one month
shall not exceed I 0% of the total gross annual income. Clause 12(iii)(a) of
the Constitution of the trade union provides that a member of the union who
is dismissed for joining the union or promoting or actively participating in its G
activities, shall be entitled to victimization benefits in accordance with the
rules laid down by the Executive Committee of the Union. Clause 12(iii)(b)
entitles a member to legal aid in proceedings which arise out of his relations
with the employer. It reads:

        "A member of the Union who has paid the subscription of previous                          H
    406                     SUPREME COURT REPORTS [2003) SUPP. 5 S.C.R.

A           one year, shall be entitled to legal aid in all proceedings which arise
            out of his or her relations with the employer provided that this clause
            does not apply to the newly-appointed employee."            "

          There is no provision in the Act on the Constitution of the trade union
    providing for automatic cessation of membership on cessation of employment.
B
          In view of the provisions in the Constitution of the trade union and in
    absence of any provision providing for cessation of membership as a result
    of cessation of employment, it cannot be held that an employee would cease
    to be a member of the trade union on termination of his employment.

C       Reliance has, however, been placed on behalf of the respondent upon
  the decision of this Court in State Bank of India Staff Association and Anr.
  v. State Bank of India and Ors., [1996] 4 SCC 378 where it was held that
  the management was not supposed to negotiate with the employee as General
  Secretary of the Banks Staff Association since he ceased to be an employee
D of the Bank after retirement. In the said case, the relevant Rules and
  Constitution of the State Bank of India Staff Association provided that after
  retirement from Bank's service, ordinary members shall not continue to be
  such members. Considering the said Rules, it was held that "A cursory look
  at Rule 5 will make it clear that to become an ordinary member of the
  Association one has to be a permanent employee of the State Bank of India
E and at the same time not below the age of 18 years whereas Rule 6 provides
  that a person who is not a permanent employee of the Bank as contemplated
  under Rule 5 but has some sympathy with the objects and spirits of the Union
  he may be elected honorary member at the triennial or special meeting of the
  General Council etc .... convened for the purpose. Further, according to Rule
F 9 ordinary members after retirement from the Bank's service shall not continue
  to be such members while clause (a) of Rule 9 provides that an ordinary/
  honorary member of the Association will be eligible to occupy or continue
  in any post in the Central Committee/Central Working Committee/Circle
  Committee/Unit Committee but such ordinary/honorary member of the
  aforesaid committees will forthwith cease to be such member if he ceases to
G be an ordinary/honorary member, notwithstanding contained to the contrary
  in the Rules."

        The State Bank of India StaffAssociation's case does not lay down that
  clause (e) of Section 6 provides for cessation of membership. In our view, it
  only provides for admission of membership. In the absence of any provision
H in the Constitution of the trade union for automatic cessation of membership
    BOKAJANCEMENTCORPN. EMPLOYEES' UNION". CEMENTCORPN. OFINDIALTD. (SABHARWAL. J.]   407
as a result of cessation of employment, it cannot be held that an employee                  A
would cease to be a member of the trade union in such an eventuality.

      For the aforesaid reasons, setting aside the impugned judgment, we
restore the judgment of the learned Single judge of the High Court and allow
the appeal. The parties, in the facts and circumstances of the case, are left to
bear their own costs.                                                            B
K.K.T.                                                              Appeal allowed.




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