The Supreme Court on Tuesday refused to block an ongoing industrial dispute involving contract workers at an Aurangabad-based manufacturing unit, holding that a formal demand notice to the employer is not mandatory before conciliation begins.
Dismissing a civil appeal filed by Premium Transmission Private Limited, the court allowed the dispute raised by contract workers to proceed before the Industrial Court in Maharashtra, clearing the way for adjudication on whether the labour contracts were genuine or merely a facade.
The case arose from a challenge to a 2020 government order that referred a labour dispute to the Industrial Court after conciliation talks failed. The management argued that the entire process was illegal because the workers’ union had directly approached the Conciliation Officer without first issuing a demand notice to the company.
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However, the Supreme Court disagreed, stating that the law allows intervention even when a dispute is only apprehended.
Premium Transmission operates a large manufacturing facility in Aurangabad and employs contract labour through registered manpower agencies.
In 2019, a group of workers, represented by a local union, alleged that the contracts were sham and bogus, claiming they were performing permanent and perennial work under the direct control of the company.
The workers sought regularisation, equal wages, and protection against termination. Conciliation failed, leading the Maharashtra government to refer the dispute to the Industrial Court in January 2020.
The company challenged this reference before the Bombay High Court, and later before the Supreme Court.
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The company contended that no “industrial dispute” legally existed because the union never raised a formal demand with management before approaching the Conciliation Officer.
It argued that the workers were employees of licensed contractors, not of the company, and that the reference was made mechanically without examining this basic relationship.
The union countered that raising demands directly with the employer could have resulted in immediate termination. It also argued that labour law permits conciliation even when unrest is anticipated.
Justice S.V.N. Bhatti, speaking for the bench, rejected the company’s preliminary objection.
“The Industrial Disputes Act does not require that a demand must first be served on the employer before conciliation can begin,” the court observed.
The bench clarified that the law empowers the government to act when a dispute exists or is apprehended, and courts should not frustrate that preventive mechanism by technical objections.
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Importantly, the court noted that when an employer itself denies the existence of an employer–employee relationship, that denial can itself give rise to a dispute requiring adjudication.
“Permitting preliminary objections to stall conciliation would defeat the very purpose of maintaining industrial peace,” the judges noted.
The Supreme Court upheld the High Court’s decision and dismissed the company’s appeal.
It directed the Industrial Court to frame two specific issues:
- Whether the labour contracts were sham or nominal.
- Whether the company was the principal employer of the workers.
The Industrial Court has been asked to decide the reference within four months.
With this, the dispute will now proceed on merits before the labour forum.
Case Title: M/s Premium Transmission Private Limited v. The State of Maharashtra & Others
Case Number: Civil Appeal No. ___ of 2026 (arising out of Special Leave Petition (Civil) No. 9970 of 2023)
Judgment Date: 27 January 2026
