Award Is Vitiated by Non-Consideration of Material Evidence: Orissa High Court Sets Aside Industrial Tribunal’s Wage Award in IMFA Case

“Mechanical Application of Precedents Without Evidence-Based Analysis Cannot Sustain a Judicial Award” –  In a latest judgement High Court of Orissa at Cuttack delivered a significant judgment in The Management of the Vice President (Operations), M/s Indian Metals and Ferro Alloys Ltd. v. Government of Odisha & Others, setting aside an industrial award related to onward revision of wages and additional dearness allowance granted to workers of the IMFA’s Theruballi Unit.

The Division Bench comprising Justice K.R. Mohapatra and Justice Savitri Ratho held that the Industrial Tribunal’s award was unsustainable due to the “non-consideration of relevant and material evidence”, mechanical reliance on Supreme Court precedents, and failure to provide reasoned findings on core issues.

The judgment is a notable reiteration of judicial limits on industrial adjudication, especially under the writ jurisdiction conferred by Articles 226 and 227 of the Constitution, where the High Court is empowered to intervene in cases involving “failure to exercise jurisdiction or where findings are based on no evidence.”

“The Tribunal Straightaway Jumped to Conclusions Without Analysing Evidence”

Application of ‘Industry-Cum-Region’ Principle Must Be Based on Actual Facts, Not Just Precedents

The main contention before the High Court arose from an award dated 10.10.2013, passed by the Industrial Tribunal, Bhubaneswar in Industrial Dispute Case No. 6 of 2006, which allowed wage revision and additional DA claims raised by the IMFA Shramik Sangha, representing workmen at the Theruballi plant.

The Management, represented by Senior Advocate Mr. Narendra Kishore Mishra, argued that the Tribunal merely reproduced the principles laid down in Hindustan Antibiotics Ltd. v. Workmen and Kamani Metals & Alloys Ltd. v. Workmen without any analysis of the oral or documentary evidence led by both sides.

The Court noted: “The learned Tribunal, after reproducing the principles in aforesaid case laws… straightaway jumped to the conclusion answering issue Nos.1 and 2 in favour of the Workmen. The Tribunal did not make any attempt to analyze the case of either of the parties in reaching at the conclusion.” [Para 17]

The High Court held that mechanical reliance on judgments without applying their underlying principles to the specific facts of the Theruballi Unit case rendered the award infirm.

“Award Must Be Based on Evidentiary Scrutiny – Not Speculation or Assumptions”

Tribunal Failed to Account for Settlements, Comparable Industry Data and Specific Financials of the Theruballi Unit

The Court sharply criticized the Tribunal’s approach to critical financial issues, including the alleged profit figures, wage burden calculations, and comparative wage structure with similar regional industries such as FACOR at Bhadrak and Shreeramnagar.

While the Tribunal concluded that IMFA had earned profits of over Rs.18.58 crores and could bear an additional wage burden of Rs.1.29 crores, the High Court observed: “Learned Tribunal did not discuss the source from which the aforesaid figures were derived… The Annual Reports relied upon relate to all units of Indian Charge Chrome Limited and not exclusively to the Management Unit at Theruballi.” [Para 22]

Further, the Tribunal’s non-consideration of crucial evidence, including bipartite settlements with majority workmen during the pendency of the reference, was found to be a significant lapse.

“Had the subject matter of bipartite settlement been discussed, it would have thrown a light on the legitimacy of the claim of the Workmen in the impugned award.” [Para 21]

Moreover, despite the settlement with 25 out of 39 workmen, the Tribunal failed to apply the law laid down in TELCO v. Their Workmen [AIR 1981 SC 2163], which recognizes the presumption of fairness in settlements with a majority.

“Each Legal Point in Reference Must Be Specifically Answered with Reasons”

Tribunal Omitted Determination of Actual Entitlements and Quantum of Benefits

In relation to Issue No. 1 (onward revision of basic wage and allowances) and Issue No. 2 (Additional Dearness Allowance on All India CPI), the Court found that the Tribunal failed to discharge its statutory duty under Section 10(4) of the Industrial Disputes Act, 1947.

“The learned Tribunal answered issue No.(i) in the affirmative… but did not state the details of the entitlement of the Workmen… The Tribunal appears to have casually dealt with such an important issue.” [Para 23]

On the question of additional DA, the Court noted that while referring to the All-India CPI and regional industry practices, the Tribunal neither identified the basis for computation nor quantified the actual amount payable, which was an essential part of the reference.

“Learned Tribunal, while answering point No.(ii), failed to give details of such entitlement… which was required as per the terms of reference.” [Para 24]

High Court’s Intervention Justified Under Article 227

Relying on the ratio in Syed Yakoob v. K.S. Radhakrishnan [AIR 1964 SC 477], the Court held that this was a fit case for interference in writ jurisdiction, as the findings of the Tribunal were “based on no material evidence” and reflected a “failure to exercise jurisdiction.”

The Bench noted: “The award suffers from non-consideration of material evidence on record… This Court has ample power under Article 227 of the Constitution of India to interfere with such findings, which are based on no material.” [Para 27]

The argument by the workmen's counsel that the award need not be elaborative was rejected. The Court distinguished the case from Hare Krushna Mahatab Library v. Prasanna Kumar Sethi [2025 (1) ILR Cutt. 1082], stating:

“In the present case, learned Tribunal failed to discuss the evidence on record… It is not merely a case of brevity, but one of omission of material adjudicatory duty.” [Para 27]

Remand for Fresh Adjudication – Liberty Granted to Adduce Additional Evidence

Taking note of the time elapsed and possible evidentiary developments, the High Court set aside the Tribunal’s award dated 10.10.2013 and remitted the matter back for a fresh adjudication, permitting both parties to lead additional evidence.

“We would have not hesitated to discuss the evidence on record and arrive at a conclusion, but that may prejudice the case of either party… More particularly when there is scope for additional evidence.” [Para 28]

Both sides have been directed to appear before the Tribunal on 6th January 2026 for further proceedings.

The High Court has underscored the duty of industrial adjudicators to render speaking and reasoned awards after due consideration of all material evidence. It has clarified that while precedents offer guiding principles, their application must be grounded in the specific facts, financials, and evidentiary matrix of the case.

The Tribunal’s failure to engage with the effect of bipartite settlements, its reliance on aggregate corporate reports not specific to the Theruballi Unit, and lack of quantified findings led the Court to the inevitable conclusion that the award could not be sustained.

Date of Decision: 10th December 2025