Table of Contents

Sl.No Particulars Pg. No

1. Introduction 04
2. Meaning of Trade Union 06
3. Immunities granted to the Trade Union 08
4. Case Study 13-17
5. Facts of the case 14
6. Issue of the case 15
7. Ratio 16
8. Judgement 17
9. Conclusion 18

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RESEARCH METHODOLOGY

A) RESEARCH OBJECTIVE
The Act was formulated in 1926 called- Indian Trade Union Act and enforced from 1st June 1927. The
Indian Trade Union Act 1926 was passed to provide for the registration of trade unions with a view to
render lawful association of workers. The act also defined law relating to registered trade unions and
provided certain privileges and protection to the registered trade unions.

B) REVIEW OF LITERATURE
A Trade Union is a continuous association of wage earners for the purpose of maintaining the
conditions of their lives. But the statutory definition given in the Trade Unions Act, 1926 uses the
expression "combination" instead of "association" used in Sydney's definition. The word
'combination' carries a very wide meaning. Whatever may be the 'combination' if it is for one or
the other of the statutory objects (as provided in this Act) it is Trade Union. It is the primary object
of an association which determines its nature.

C) SCOPE
It applies to registered trade unions and extend to the whole of India including the state of Jammu and
Kashmir. The Act applies to all kinds of unions of workers and association of employers. The Act aims at
regularizing the labour management relation.

D) NATURE OF WORK

The paper is common sensical but again fostered with the complexities of conscientious
elucidations. The work method adapted is more than an argument fundment and an inductive
representations but the expressive ideas of the objective presence have been nurtured with
substantive truth and facts which has made it quite interesting and a well experiential work.

E) MODE OF CITATION
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NLS uniform mode of citation has been adopted throughout the course of the paper.

Introduction:-

The law relating to the registration and protection of the trade union is contained in the Trade Union Act,
1926 which came into force with effect from 1 st June, 1927. A Trade Union is an association of workers
with an objective of protection and promotion of interest of the working class. The germs of trade
unionism in India can be traced back to the year 1890, when for the first time an association of mill
workers was formed in the name and style of "Bombay Millhands Association". This association was
formed for the redressal of grievances of the Bombay mill workers. It is difficult to treat this association
as Trade Union in the strict sense in which this expression is used now-a-days. Very little account is
available about its mode of working. After the First World War was over the cost of living considerably
increased. The political agitation against foreign rule was also gaining momentum throughout the country.
The increase in cost of living and country-wide political unsurge found its way in economic discontent
amongst masses, particularly in industries. The industrial unrest and economic discontent led to a number
of strikes by workers, guided and controlled by their action committees consisting of representatives of
workers themselves. On many occasions these strikes were successful in getting the demands of the
workers fulfilled. The Trade Union movement in India got impetus by the success of strikes in India and
the world-wide unrising of Labour consciousness. The establishment of International Labour Organisation
has also influent the growth to the trade movement in our country.

The progress of the trade union movement in India in pre-independence days has not been very
satisfactory, but the post-independence has been a tremendous Trade Union activity in every sphere of
industry. Now there is hardly any category of workers which has no union of its own. The royal
commission on Labour in India has observed: "Trade unionism to be fully effective, demands two things:
a democratic spirit and education. The democratic ideal has still to be developed in the Indian workers
and the lack of education is the most serious obstacle of all. The latter difficulty does not arise merely or
even mainly from illiteracy. Few Trade Unions can afford to conduct benevolent work, and the majority
find it hard to convince the worker that a subscription is worthwhile except when a dispute is imminent or
in progress"

Thus in a nutshell the following observations are made:

The Act was formulated in 1926 called- Indian Trade Union Act and enforced from 1st June 1927. The
Indian Trade Union Act 1926 was passed to provide for the registration of trade unions with a view to

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render lawful association of workers. The act also defined law relating to registered trade unions and
provided certain privileges and protection to the registered trade unions.

Object of the act

Conditions governing the registration of trade unions.
Obligations imposed upon a registered trade union.
Rights and liabilities of registered trade unions.

Scope
It applies to registered trade unions and extend to the whole of India including the state of Jammu and
Kashmir. The Act applies to all kinds of unions of workers and association of employers. The Act aims at
regularizing the labour management relation

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Meaning of Trade Union :-

Sec. 2(h) of the Trade Unions Act, 1926, which defines Trade union which can be analysed in to the
following ingredients:

(1) Any combination whether temporary or permanent;

(2) The combination should have been formed for the purposes of:

(a) regulating the relations between:

(i) workmen and employers; or

(ii)Workmen and workmen; or

(iii) employers and employers; or

(b) imposing restrictive conditions on the conduct of any trade or business. But this Act shall not
effect:

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

(ii) any agreement between an employer and those employed by him as to such employment;

(iii) any agreement in consideration of the sale of the goodwill of a business or instruction in any
profession, trade or handicraft.

A Trade Union is a continuous association of wage earners for the purpose of maintaining the conditions
of their lives. But the statutory definition given in the Trade Unions Act, 1926 uses the expression
"combination" instead of "association" used in Sydney's definition. The word 'combination' carries a very
wide meaning. Whatever may be the 'combination' if it is for one or the other of the statutory objects (as
provided in this Act) it is Trade Union. It is the primary object of an association which determines its
nature. A society consisted of authors, publishers and other owners of copyright and was formed for the
protection of copyright in music and songs. There were also certain rules which could be regarded as
imposing certain restrictions on the trade of the individual music publishers who became members of the
association. The society was held by the House of Lords to be not a Trade Union because the principal
object of the society was the protection of the copyright. It was further held that, to come within the
statutory definition, restrictive conditions imposed must be in respect of trade or business will not suffice.
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It was held in National Organisation of Bank Workers' Federation of Trade Unions v. Union of India &
others1, that where a federation of trade unions is not registered it is not a trade union under the Act. It is
not a juristic person and is not competent to raise a demand on behalf of employees which can fall in the
ambit of industrial dispute. It cannot file a writ petition.

In G.T.R.T.C.S. and Officer's Association, Bangalore and another v. Assitant Labour Commissioner and
Deputy Registrar of Trade Unions, Bangalore Division I and anothers 2, the respondent authority refused
to register the petitioner as trade union on the ground that the applicants were not workmen within the
meaning of Sec. 2(s) of the Industrial Disputes Act, 1947. The High Court observed that as per Sec. 2(g)
of the Trade Unions Act, 1926 the word 'workman' included all persons employed in a trade or industry. It
was not a restricted definition as in any other Labour Law enactment, The emphasis was on the purpose
for which the union was formed and not so much on the persons who constituted it.

In Food Corporation of India Staff Union v. Food Corporation of India and others 3, it was held that
where more than one unions claim representative character, the method of secret ballot should be adopted
to ascertain the correct position as regards the membership of different Trade Unions.

1 (2002) II L.L.J. 335 (Kant.).

2 (1995) II Lab. L.J. 272 (S.C.)

3 (1993) II Lab. L.J. (Bombay)

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Immunities Granted to The Trade Unions:-

The office-bearers of Trade Unions cannot perform their duties successfully, properly and efficiently in
order to carry out the mission of the Trade Union unless certain immunities are granted to the Trade
Unions as such and to their officers and members. The Act intended to legalise the Trade unions and to
provide immunities to them for the purpose to accomplish their lawful objectives. The Trade Unions Act
contains following provisions in this regard:

(1) Immunity from criminal liability:- Sec. 17 of the Act grants immunity from criminal liability to
registered Trade Unions. It provides that " no office-bearer or member of a registered Trade Union shall
be liable to punishment under sub-sec.(2) of sec. 120-B of the Indian Penal Code, 1860, in respect of any
agreement made between the members for the purpose of furthering any such object of the Trade Union
as is specified in Sec. 15 , unless the agreement is an agreement to commit an offence."

In view of this provision no office-bearer or member of a registered Trade Union shall be liable for
criminal conspiracy in respect of any agreement between the members for the purpose of furthering any
such object which are specially mentioned in Sec.15 of the Act on which the general funds of the Trade
Union may be lawfully spent. There is only one restriction that the agreements to commit an offence are
not covered under the protection provided for in the Act. Jaya Engineering Works v. State of West Bengal,
is an interesting case on the point wherein the special Bench has held that the word 'gherao' is a physical
blockade of target, either by encirclement intended to blockade the egress and ingress from and to a
particular office, workshop, factory or even residence or for civil occupation and that the blockade may
be complete or partial and is invariably accompanied by assault, criminal trespass, mischief to person and
property, unlawful assembly and various oth, criminal trespass, mischief to person and property, unlawful
assembly and various other criminal offences. Some of the offences are cruel and inhuman, like
confinement in a small space without lights or fans and for long periods without food o communication
with the outside world.

The legal principles to be derived from the 'famous Trilogy' were formulated by Lord Cave in Sorrell v.
Smith4, as follows:

(1) A combination of two or more persons wilfully to injure a man in his trade is unlawful, and, if it
results in damage to him, is actionable.

4 (1925) A.C. at p. 712.

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(2) If the real purpose of the combination is not to injure another, but to forward or defend the trade of
those who enter into i, then no wrong is committed and no action will lie, although damage to another
ensues.

The scope of criminal conspiracy is unfortunately ill-defined, and it is in respect of the first of the classes
mentioned below that it is possible to state the law with complete certainty. Criminal Conspiracy may be
divided under four heads, namely:

(1)Agreements to commit a crime;

(2) Agreements to commit certain torts;

(3)Agreements to obstruct or pervert the course of justice; and

(4) Agreements to do acts contrary to public morality or decency.

Although the restrictions are there but immunity granted under Sec. 17 of the Trade Unions Act, 1926, is
of significant importance for the trade unionists, and by virtue of this provision the Trade Unions have
become lawful associations.

In Dr. P.H.Daniel v. Krishna Iyer5, question for decision was whether a trade union leader can claim
immunity for defamatory statement. In this case a trade union made a statement, per se defamatory in the
annual conference of the union, against the plaintiff in which Labour Minister was also present. The
speech was later published in full in the journal of the union circulated only among the members. The suit
was brought for damages for defamation. It was observed that leaders of the Trade union movement have
a duty and legitimate interest to champion the cause of their members. They have also a duty towards the
society to uphold truth and justice. Their duties towards the members or their interest in furthering their
cause must not be allowed to override their fundamental duty to society not to destroy truth by
deliberately propagating falsehood. Subject to any such overriding considaeration or principle of law, it is
in the interest of society at large that the trade unions should function without any undue inhibition or
restriction. . Freedom of communication between members is vital to every union.

It may be pointed out that when two or more persons agree to do, or cause to be done, an illegal act, or an
act which is not illegal by illegal means, such an agreement is designated a criminal conspiracy. Sec.120-
B(1) of the Indian penal Code provides that whoever is a party to a criminal conspiracy to commit an
offence punishable with death, imprisonment for life or rigorous imprisonment for a term of two years or
upwards, shall, where no express provision is made in this Code for the punishment of such a conspiracy,
be punished in the same manner as if he had abetted such offence and sec. 120-B(1) provides that

55(1982) II LLJ 353 (ker.).

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whoever is party to a criminal conspiracy other than a criminal conspiracy to commit an offence
punishable as aforesaid shall be punished with imprisonment of either description for a term not
exceeding 6 months, or with fine , or with both.

In Indian Bank v. Federation of Indian Bank Employees union 6, where the plaintiff Bank prayed for an
interim injunction against the defendants restraining them from holding any meeting or staging any
demonstration or restoring to any other similar form of irregular action within the premises of the plaintiff
Bank and within a radius of 50 metres of the premises and obstructing any member of public or customer
from entering the premises, or officers, employees and servants of the bank to attend to their normal
duties and many other activities of the union such as affixing posters, handbills etc. The court observed
that it would not be proper to infer that trade unions always indulge only in violent activities and they do
not hold peaceful demonstration. Trade Union activities can be affected peacefully in an organised
manner. Some limited forms of peaceful demonstration even inside the premises of the factory or
institution are permissible. Therefore, the court held that the plaintiff bank would not be entitled to ask for
an interim injunction pending disposal of the suit. The plaintiff has a code of discipline and set of rules to
enforce orderly conduct. It is having necessary personnel for the purpose. If they are incapable to
maintain discipline in the institution and claim that discipline among the bank staff can be achieved only
by an injunction, it is misfortunate to the public whose money was invested when banks were
nationalised; in that its managerial personnel are not able to enforce internal discipline and when not
obeyed, they do not take stern measures to punish the derelicts.

(2) Immunity from civil liabilities:- :- Section 18 of the Act deals with the immunity from civil
proceedings afforded to a registered union, and to its members or office bearers.

The Trade Union activities not only amount to criminal conspiracies in certain cases but they may
amount to interference with the business of the employer when the Trade Union or any office-bearer or
members thereof act in particular way in contemplation or furtherance of a trade dispute. The Act done
by the trade unionists induces some other person to break a contract of employment , or it is interference
with the Trade, business or employment of some other person or with the right of some other person to
dispose of his capital or his capital or of his labour as he wills. In all such cases they may be held liable
for damages under general law of the land. But the immunity has been afforded to them in all such cases
under the provisions of the Trade unions act.

The Trade Unions Act,1926, in its Sec.18, provides that no suit or other legal proceedings shall be
maintainable in any civil Court against any registered Trade Union or any office-bearer or member
thereof in respect of any act done in contemplation or furtherance of a trade dispute if the ground is only

66(1982) II L.L.J. 123(Mad.).

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that such act includes some other person to break a contract of employment , or that it is interference with
the trade business or employment of some other person or with the right of some other person to dispose
of his capital or of his labour as he will.

In Ram Chandra Tripathi v. U.P. Public Services Tribunal IV and others 7, where non-stigmatic order of
termination was passed against an employee who was an office-bearer of a union and had allegedly raised
demands on behalf of the employees. It was held that the order of termination cannot ipso facto be treated
as punitive. The appellant had poor service record and had suffered adverse entries. The order was passed
without any stigma and in accordance with the service rules, therefore, it cannot be held to be illegal or
invalid. However, keeping in view his advanced age and difficulty in getting suitable employment
opportunity, while the impugned termination order is upheld the U.P. Jal Nigam is directed to pay an ex
gratis sum of Rs. 75,000/- to the appellant, within a period of three months.

It may be pointed out that the Trade Union or member thereof is not immune from civil liability in respect
of any act which has not been done in contemplation or furtherance of a trade dispute to which no
member of a trade union is a party if suit has been filed or other legal proceedings is instituted on any
other ground which is not specially mentioned in Sec.18 (1) of the Act. But the grounds mentioned in Sec.
18(1) are wide enough to cover union activities to a great extent which may be done in contemplation or
furtherance of a trade dispute.

In Simpson & Group Companies Workers & Staff Union v. Amco Batteries Ltd. 8 , it was held that
physical interference or duress with free movement of executives, contractors, staff, suppliers and other
public or physically obstructing the free movement of cars, vehicles and lorries carrying raw materials,
intermediaries, end products into and out of the factory premises could not be justified as a trade union
right or a fundamental right under Art. 19 of the Constitution of India. Immunity under Sec. 18 of the
Trade Unions Act, 1926 does not extend to the above activities. Right to picket is a very intangible one
and is limited by the equal right of others to go about their lawful affairs free from objection or
intimidation.

It was held in Reserve Bank of India v. Ashis Kumar 9, that in order to secure immunity from civil liability
under Sec.18 inducement or procurement of breaches of contract of employment in furtherance of a trade
dispute or interference with business of another person in furtherance of a trade dispute must be by lawful
means and not by means which be illegal or wrongful by other provisions of law. It was further held that

77 1994 SCC (L&S) 1044.

88 (1992) I LLJ. 266 (Karn.)

99 (1969) 73 Cal. W.N. 388.

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the movement or agitation or demonstration by the employees for the purpose of compelling employer to
withdraw certain disciplinary proceedings initiated against some of them was in contemplation or in
furtherance of trade dispute and therefore, not accepted.

In Sri Ram Vilas Service Ltd. and others v. Simpson and Group Companies Workers Union and others 10, it
was held that if cessation of work is the result of strike, the effect of strike will be nullified if the
managements either by themselves or through their customers are permitted to remove the goods either
manufactured by the managements or coming into custody of the managements or coming into custody of
the management in the course of their trade.

It may be concluded that if above conditions are fulfilled the immunity can be claimed and no suit or
other legal proceedings shall be maintainable in any civil court against any registered Trade Union as
such or any office-bearer such as President, Secretary, etc. or the members of the Trade Union in respect
of any act done in contemplation or furtherance of trade dispute.

1010(1979) II LLJ 284 (Mad.)

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 Case Study on

Standard Chartered
Bank......................................................................Appellant

v.

Hindustan Engineering and

General Mazdoor
Union.....................................................................Respondent

Citation: (2001) I LLJ 1009(Del):95(2002) DLT 182

Author: J Kapoor

Bench: J.D. Kapoor, J.

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Facts of the case

Standard Chartered Bank (plaintiff) is a bank corporated in England with limited liability by Royal
Charter, 1853 having its Indian corporate office at New Excelsior Building on the 3rd and 4th floor at Naik
Marg, Mumbai and it branch office at 17, Parliament Street, New Delhi.

The plaintiff received a letter in the evening of 17.11.2000 from the Hindustan Engineering and General
Mazdoor Union (defendant no.1) wherein the Union has threatened a massive demonstration before the
plaintiff bank office situated in New Delhi.

Perusal of the said letter indicates that the said letter was issued at the behest of Defendant no.2 (President
of the union and the Proprietor / partner of Mahashakti Electronics) who was an account with the plaintiff
bank.

There was a dispute with defendant no.2 in respect of the account which he holds with the plaintiff bank
and the dishonour of cheque issued by defendant no.2. It was stated in the said letter that a demonstration
was earlier planned for 19.11.2000 which has since then be postponed for 20.11.2000.

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 Issue of the case:-

Issue : Whether the right to freedom of speech and expression, if any granted under Article 19(1)(g) does
not confer any exclusive right on a union to hold demonstration, particularly when they have no right to
do so?

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 Ratio:

Article 19 of the Constitution of India guarantees the right of freedom of speech and of assembling
peacefully and grants freedom of form associations as contemplated by Clause 9(b) and (c) of the Article
19.
But again there is an unvarying unanimous opinion that such a right is not unfettered or absolute or in the
nature of free for all. In 1991 LLR 792, A.D. Singh, J. also dealt with this aspect at great length and
placing reliance on, Kameshwar Prasad and Ors. v. State of Bihar and Anr.; , Railway Board, New Delhi
and Anr. v. Niranjan Singh; 1966 Lab. IC 1543, The Association of State Road Transport Undertakings v.
The Association of State Road Transport Undertakings Employees Union (Regd.) and Others, observed
that every citizen of India has freedom of speech and to form associations and unions but there is no right
to hold meetings and shout slogans at premises legally occupied by another. Freedom is thus shackled by
responsibility. There can be no freedom without responsibility.
However there is a unanimity that legitimate right of the Unions can be preserved and protected only by
allowing them to hold demonstrations at a distance of 50 or 100 meters from the legally occupied
premises.

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 Judgement:-

The High Court decreed a suit of the bank by restraining the defendant union from holding
demonstrations etc, within a radius of 100 metres from the suit property. If it is further observed that the
freedom of speech and right to form an association granted by the Constitution did not confer a right to
hold meetings and shout slogans at premises, legally occupied by another.

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Conclusion
Coming to the end of the research, it may be observed that Section 17 and Section 18 of the Trade Union
Act, 1926 proves to provide immunity from criminal liability and immunity from civil suits in certain
cases to registered Trade Unions. The Trade Union activities not only amount to criminal conspiracies in
certain cases but they may amount to interference with the business of the employer when the Trade
Union or any office-bearer or members thereof act in particular way in contemplation or furtherance of a
trade dispute.

Further, through the case study, it comes into observance that the right provided by Article 19 of The
Constitution of India does not confer a right to hold meetings and shout slogans and hold demonstrations
at premises legally occupied by another. The same can be done, only by maintaining a distance of 50-100
metres from the property occupied by another. The sole reason could be to protect the daily public utilities
and public services from being hampered.

The Trade Union Act of 1926 grants the right to form a union and negotiate wages and fringe benefits
which can lead to increase in cost and lower competitiveness.
While fair wages and healthy working conditions are a prerequisite for a good industry, protests in the
form of stoppage of production can backfire on the workers by reducing revenue of the business unit,
prompting cost cutting measures like layoffs.

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Bibliography

Books Referred:

Mishra, s.n, labour and industrial laws 24th edn.

Malik p.l, labour and industrial law 11th edn.

G.b. Pai, labour law in india, vol. 1

Goswami.g.v.dr, labour & industrial laws, 8th ed., central law agency

Singh avtar. Dr & kaur harpreet.dr, introduction to labour & industrial law, 2nd ed., 2008, lexis-
nexis butterworths wadhwa nagpur

Ludwig teller, labour disputes and collective bargaining, vol 1

Websited referred:

https://indiankanoon.org/doc/1162449/

http://www.deccanherald.com/content/42709/trade-union-act-bane-indian.html

http://www.ilo.org/dyn/natlex/docs/WEBTEXT/32075/64876/E26IND01.htm

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