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Labour & Industrial LawSupreme Court of India

Tamil Nadu Chamber of Commerce and Industry & Anr. v. P Mahendravel & Ors.

Civil Appeal · 2018 INSC 664Decided 1 Aug 2018
Civil Appeal No. 7421 of 2018
Justice Kurian Joseph · Justice Sanjay Kishan Kaul

Background

The appellant Chamber of Commerce had taken steps to expel certain members from its ranks. The expelled members challenged this before the civil court, which ruled in their favour, and that decision was upheld by both the First Appellate Court and the High Court, each finding that the expulsion violated principles of natural justice. The Chamber then appealed to the Supreme Court.

Decision Breakdown

During the pendency of the appeal, both sides agreed to refer the dispute to a retired High Court judge (Justice A.R. Ramalingam) for an independent inquiry, with costs shared 67:33 between the parties and the expelled members directed to respond to the original show-cause notice. After the retired judge submitted his report, the Supreme Court declined to go into its merits, holding that since both sides had voluntarily agreed to this reference, the report could not be said to improperly override the earlier court judgments. The Court disposed of the appeal, clarifying that its order did not bar the respondents from pursuing other lawful remedies regarding membership, and noted it would be open to them to tender an unconditional apology and reapply, which the Chamber would be expected to consider generously.

Lesson Learnt

When parties voluntarily agree to resolve a dispute through an independent, mutually appointed arbitrator/inquiry officer, courts will generally respect that consensual process rather than second-guess its findings on merits.

Tamil Nadu Chamber of Commerce and Industry & Anr. v. P Mahendravel & Ors. – Legal Case Shots | LegalAware