Madras High Court
A. Shanmugasundaram (Deceased), S. ... vs The Management Of Dinakaran, The ... on 7 December, 2007
Author: M. Venugopal
Bench: S.J. Mukhopadhaya, M. Venugopal
JUDGMENT M. Venugopal, J.
1. The first appellant [since deceased] herein is the petitioner in W.P. No. 15904 of 1991. Appellants 2 to 4 are impleaded as Legal Representatives of the first appellant [since deceased] vide order of Court dated 01.02.2005 made in WAMP. No. 8001/2004].
2. It is the case of the first appellant/petitioner that he was employed as Sub Editor in Navasakthi from 1960 and was dismissed from service on 21.03.1967 and I.D. No. 138 of 1967 was filed by the first appellant and the Labour Court passed an award on 21.02.1970 in favour of the appellant. The award passed in I.D. No. 138/1967 directed the second respondent herein to reinstate the appellant into service with backwages and other consequential benefits.
3. The first appellant/writ petitioner preferred a claim petition in C.P. No. 849/1970 before the Labour Court, Madras claiming backwages from the date of termination of service and also laying a claim for quantification of future remuneration payable to him till his retirement.
4. As a matter of fact, the Labour Court passed an order computing the sum of Rs. 9,246.47 being the backwages and rejecting the claim in other respects. As against the orders passed by the Labour Court, WP. No. 1948/1972 was filed before this Court and this Court passed orders on 16.03.1976 in the said writ petition. Later, the first appellant/writ petitioner preferred a claim petition in C.P. No. 138/1976 claiming the relief of backwages for the period from 21.06.1970 to 22.03.1976 and also claiming bonus payable to him from 1966-67 to 1975-76 and the Labour Court passed orders for a sum of Rs. 32,475.11 in the said claim petition. Thereafter, the first appellant/writ petitioner filed WP.No.8580/1982 against the Collector of Madras praying for an order to recover the said sum of Rs. 32,475.11 and on 06.07.1983, a direction was issued to the Collector of madras to take expedite steps in recovering the entire sum on or before 30.09.1983 and the said amount was recovered from the first respondent/Management, who took over the Management of the second respondent.
5. Subsequently, the first appellant/writ petitioner preferred claim petition in C.P. No. 147/1981 before the third respondent/Principal Labour Court, Chennai, praying for an order for a sum of Rs. 35,198.94 due from the first respondent/Management and from the second respondent relating to the period from 23.03.1976 to 28.07.1981 and on 24.04.1989, the third respondent/Principal Labour Court, Chennai, passed an order that Rs. 8,570/- due, to be paid by the second respondent/Management to the first appellant.
6. As against the orders passed by the third respondent/Principal Labour Court, Chennai dated 24.04.1989 in C.P. No. 149/1981, the first appellant herein filed the writ petition in WP. No. 15904 of 1991 before this Court.
7. In WP. No. 15904/1991, the learned Single Judge of this Court passed an order on 14.06.1999 inter-alia observing 'when the matter came up for hearing today for arguments, learned Counsel for the respondents has produced a Magazine 'Navasakthi' before this Court asserting that the Magazine was published by the same Management. But, however the above fact has been disputed by learned Counsel for the petitioner in the writ petition that the Management is not the same Management was run by the second respondent. Whether the Management is the same or not is purely a question of fact and the writ petition was dismissed against the respondents on 28.11.1996. Under the above circumstances, I see no grounds to allow this writ petition and hence this writ petition is dismissed etc.'
8. As against the orders passed by the learned Single Judge of this Court on 14.06.1999 in W.P. No. 15904/1991, the first appellant/writ petitioner has filed the present appeal.
9. Learned Counsel for the appellants contends that the learned Single Judge has erred in dismissing the writ petition relying on the production of a copy of the new Magazine 'Navasakthi' purported to have been published by the second respondent without considering the facts and circumstances of the case when the first respondent/Management already made a payment of Rs. 32,465.11 to the first appellant as claimed in C.P. No. 138/1976. It is the further case of the first appellant/writ petitioner that the first respondent purchased the property from the second respondent and the Labour Court gave its finding in the order dated 24.04.1989 in C.P. No. 147/1981 and this was not taken note of by the learned Single Judge while dismissing the writ petition. Learned Counsel for the appellants submits that the first respondent took over the establishment belonging to the second respondent as an on going concern and in this regard, R.W. 1-Thiru R. Thiyagarajan gave evidence in C.P. No. 138/1976 that 'Navasakthi' paper was run through Bhuvaneswari Company from 14.11.1977 presently some 15 workers were continuously working.
10. It is the contention of the appellants that the first respondent/Management is only a successor in title of the second respondent/Management and the fact that the amount awarded in C.P. No. 138/1976 was paid by the first respondent/Management was not properly appreciated by the third respondent and the learned Single Judge while dismissing W.P. No. 15904/1999 on 14.06.1999 has come to the incorrect conclusion that whether the Management was the same or not, was a purely a question of fact and dismissed the writ petition.
11. The first appellant/deceased in C.P. No. 147/1981 before the Principal Labour Court, Chennai, has claimed in Annexure-1, a total sum of Rs. 32,461.44 being the backwages from 23.03.1976 to 28.02.1981 and in Annexure-2, has claimed a bonus of Rs. 2,737.50 [for the period from 1976-1981] totalling in of a sum of Rs. 35,198.94. The amount claimed in C.P. No. 147/1981 by the first appellant/deceased is due from respondents 1 and 2, since the first respondent took over th establishment from the second respondent.
12. In the award passed in C.P. No. 138/1976 dated 07.02.1978 filed by the first appellant/deceased, it is clearly held by the Principal Labour Court that the first appellant was entitled to the computation of the amount of Rs. 29,625.66 mentioned in Annexure-A to the claim petition relating to his wages for the period from 21.06.1970 to 22.03.1976 and the first appellant/deceased was also entitled to claim bonus as claimed under Annexure-B to the said petition, totalling in of a sum of Rs. 32,475.11.
13. In the counter to C.P. No. 147/1981 filed by the first respondent/Management, the stand taken was that the first appellant/deceased was never in its employment and resultantly, no claim could be made against the first respondent/Management in regard to the sum claimed in Annexure-1 and Annexure-2 of the said petition. In the counter filed by the second respondent/Management in C.P.147/1981, it was averred that it does not admit the claim of the first appellant/deceased and that the claim made by the first appellant/deceased was unsustainable.
14. It is not out of place to make a mention that RW. 1-R.Thangarajan in C.P. No. 138/1976, in cross-examination, has categorically stated that still the 'Navasakthi' paper is published and that the lessee Bhuvaneswari Company is paying the salary to the 15 employees at present from among the old employees.
15. RW.2-Thiru Govindasamy in his evidence in C.P. No. 147/1981, in cross-examination has stated that there were [1] Journalists Union and [2] Non-Journalists Union. As far as the second respondents was concerned, the first appellant/deceased will come under the Journalists Union. RW. 2 [in C.P. No. 147/1981] in his evidence, has specifically stated that Thiru Thangarajan, who gave evidence in C.P. No. 138/1976 has deposed in his evidence that at present the 'Navasakthi' paper is coming out in publication.
16. The amount of Rs. 32,475.11 was earlier paid by the first respondent/Management and that the claim of the first appellant/deceased was settled insofar as C.P. No. 138/1976 is concerned. When the first appellant/deceased was a journalist, the settlement which was arrived at between the Management and the Workers Union, will not bind the first appellant/deceased in our considered opinion.
17. It is pertinent to point out that the benefit which can be enforced under Section 33C[2] of the Industrial Disputes Act is the pre-existing benefit and arrears of salary due to annual increments, salary due for the period and amount due on revised pay to be fixed can be claimed under Section 33C[2] of the I.D. Act.
18. Even a workman can claim benefits like subsistence allowance and bonus under Section 33C[2] of the said Act as per decision reported in 1998 LIC 2674 between Secretary, Larambha Service Co-Operative Society Limited v. Suresh Chandra Chhura. An employee can recover wages on the basis of an award under Section 33C[2] of the Act in our considered opinion. Moreover, the proceedings under Section 33C[2] will survive even after the death of the workman.
19. In the decision reported in 2000 [1] LLJ 1472 between Jeet Lal Sharma v. Presiding Officer, Labour Court-IV, it is observed that 'jurisdiction of Labour Court under Section 33C[2] of the I.D. Act extends to the recovery of dues under existing right also besides dues occurring out of settlement of an award'.
20. The case of the first appellant/deceased is that when the first respondent/Management has paid the earlier sum of Rs. 32,475.11 in C.P. No. 138/1976, it is incumbent on the part of the first respondent/Management to pay the amount claimed by the first appellant/deceased in C.P. No. 147/1981 in full and the order passed by the Principal Labour Court in C.P. No. 147/1981 dated 24.04.1989 allowing the claim petition in part and computing the money value due to the first appellant/deceased from the second respondent at Rs. 6,570/- is illegal and on the same line, the appellants contend that the order of the learned Single Judge passed in WP. No. 15904/1999 dated 14.06.1999 is illegal and liable to be set aside.
21. In W.P. No. 1948/1972 filed by the first appellant/deceased as writ petitioner, this Court has passed orders on 16.03.1976 that proper remedy is to agitate of his right including backwages which were denied to him by a petition under Section 33C[2] of the I.D. Act and dismissed the writ petition without prejudice to the rights of the writ petitioner to file a fresh petition for computation of the benefits. Therefore, it is clear from the orders passed in W.P. No. 1948/1972 dated 16.03.1976, the first appellant/deceased was given liberty to agitate his rights including backwages by way of separate petition under Section 33C[2] of the I.D. Act etc.
22. It is pertinent to point out that 'a person can be called as a successor in interest only if the prior business is taken over as a going concern with all its assets and liabilities and where the business is not so taken over, but only the land and buildings are puchased for starting altogether a new business and lease plant and machinery to the vendors' disposal, the purchaser cannot be considered to be a successor or assign of the old business', as per the decision reported in 1991 [1] LLN 817 between P.S.I. Data Systems Limited v. Presiding Officer, Labour Court.
23. In 1994 LLR 112 between A.M. Sainalabdeen Musaliar v. The District Collector, it is held that 'a purchaser of a running concern will be liable to discharge encumbrance of the employees employed by the seller'. In 2003 [97] FLR 100 between Indian Oxygen Employees' Union v. Union of India, it is held that 'transfer of an undertaking from one employer to another, consent of workers is not required'.
24. In 2006 [2] SCC 488 between The Management, Mettur Beard Sell Limited v. Workmen of Mettu Beard Sell Limited, it is observed that 'on transfer of establishment, no consent of workmen is necessary'. In 1994 [2] LLJ 1046 between U.P. State Sugar Corporation, Deoria v. The Labour Court, it is held that 'a Corporation taking over the Mill will be liable to comply with the award of Labour Court even if it is wrong'. In AIR 2001 SC 1007 between Managing Director, Apsrtc v. Presiding Officer, Industrial Tribunal, Ramkote, Hyderabad, it is held that 'on transfer of Management, the workers will be entitled to benefits as available to the employees of the transferee'.
25. As far as the present case is concerned, the first appellant/deceased receivec the sum of Rs. 32,475.11 only when the Tahsildar, Mylapore-Triplicane, was about to attach the machineries in the press under the Revenue Recovery Act and he was also instructed to recovery the entire amount from the publishers of Dinakaran. Moreover, the second respondent has sold the machinery to the firsr respondent and this took place when the dispute was pending. In regard to Ex. R.5, the settlement under Section 12[3] of the Industrial Disputes Act entered into between second respondent/Management and their workmen represented by Madras Press Labour Union, it is to be stated that this settlement refers to the treating of the workmen as having been retrenched and that the second respondent/Management discontinued the publication of 'Navasakthi' with effect from 19.11.1976 on account of financial difficulties etc. In this connection it is useful to refer to the evidence of RW. 2-Thiru Govindasamy, to the effect that there was no connection between Ex. R.5, Members and the first appellant/deceased before the Labour Court. It is true that the first appellant/deceased even though was successful in I.D. No. 138/1967 setting aside his termination dated 21.03.1967, even then the first appellant/deceased was engaged only in legal proceedings without any reinstatement. Moreover, it cannot be lost sight of that a sum of Rs. 5,00,000/- was already adjusted towards consideration in regard to the sale of machineries which were sold and delivered to the first respondent/Management as per documents. On 28.05.1986 sale deed was executed.
26. The third respondent/Presiding Officer, Principal Labour Court, while passing award in C.P. No. 147/1981 dated 24.04.1989, has not taken into consideration the evidence of RW. 1 - Thiru R.Thangarajan in C.P. No. 138/1976 which was marked as Ex. P.7 in C.P. No. 147/1981 to the effect that from 14.11.1977 'Navasakthi' paper was run by Bhuvaneswari Company and that the said 'Navasakthi' paper was coming out in publication and from out of old workers presently 15 were employed and that lessee Bhuvaneswari Company was paying salary to them. Even in Ex. R.1, the Sale Deed dated 28.05.1986 entered into between 'Navasakthi' Charitable Trust represented by its Trustee Thiru Thangarajan as vendor who sold the immovable property referred to in the Schedule of the document to and in favour of Kumar Publications Trust, Madras-4, it is among other things, mentioned that Navasakthi Charitable Trust and its present Trustee Thiru Thangarajan has all the right, title over the said property, as the actual and real owners of the said property for the purpose of executing and registered the document of sale etc. In the said Ex. R.1, document [marked in C.P. No. 147/1981], it is averred that the vendor Navasakthi Charitable Trust represented by its Trustee Thiru. Thangarajan entered into an agreement dated 14.06.1979 with K.P. Kandasamy for the sale of Schedule mentioned property morefully described in the Schedule and also the machineries for the purpose of saving the said property from being sold in the public auction and for the purpose of meeting out certain immediate statutory liabilities and charges accrued by the vendor during the course of its business and that the purchaser Kumar Publications Trust Private Limited Company was put into possession on 10.05.1979, during the period of negotiation etc. Moreover, in the Sale Deed, Ex. R.1, dated 28.05.1986, it is stated that as on 10.05.1979 as agreed to between the parties the value of the land, building and machinery was Rs. 15 lakhs and that the value of the land and building as on 10.05.1979 when the purchaser was put in possession was about Rs. 9 lakhs and already a sum of Rs. 5 lakhs was adjusted towards consideration for the sale of machineries which was sold and delivered to the purchaser already by separate documents that do not form part of this Sale Deed etc. In Ex. R.1-Sale Deed dated 28.05.1986, it is categorically stated that the vendor has already delivered possession of the property as on 10.05.1979 to the said K.P. Kandasamy from whom the purchaser has taken possession of the said property etc. In the said Sale Deed, the schedule mentioned property is referred to as the building and land and premises situated in Kutchery Road, Mylapore, Madras-4 bearing Old No.60, New No.106-107 comprised in RS. No.3325/1 O.S.Nos.1867,1868 measuring in all 28428 sq.ft. The first respondent/Management, earlier has paid the sum of Rs. 32,475.11 to the first appellant/deceased, the amount claimed by him in C.P. No. 138/1976.
27. It is represented by the learned Counsel for the first respondent/Management that the first respondent/Management has taken the file from their office two years back and that the first respondent/Management has not given any instructions to the counsel in the present writ appeal.
28. As a matter of fact, as per Ex. P.6-notice dated 28.09.1983 issued by the Tahsildar, Mylapore-Triplicane Taluk, it is mentioned that as agreement of sale dated 14.06.1979 entered into between Navasakthi paper represented by its proprietor and K.P. Kandasamy, Managing Trustee of Kumar Publications Trust, the latter came into possession of the movable and immovable properties situated at Old No. 6, New No. 106-107, Kutchery Road, Madras-4 on 10.05.1979 and subsequently a sale deed was executed between the aforesaid two parties and the latter became the absolute owner of all movable and immovable properties situated in Old No. 6, New No. 106-107, Kutchery Road, Madras-4, by virtue of the sale deed, the liabilities also fell on him. Therefore, the Kumar Publications Trust represented by Thiru K.P. Kandasamy as Managing Director and Trustee was liable to pay the entire dues awarded by the Labour Court to the first appellant/deceased. In Ex. P.6-notice dated 28.09.1983, Messrs. Kumar Publications Trust represented by K.P. Kandasamy was therefore requested to pay the sum of Rs. 32,475.11 etc., and opportunity was given to the said Trust as per order of this Court passed in WP.Nos.3560/1979 and 3561/1979. Even in Ex.R.2 dated 04.04.1979, the name of the first appellant/deceased was not to be found as one among the employees who received money from the second respondents/Management. Even from the evidence of RW. 2-Govindasamy, in Ex. R.5-12[3] Settlement [unsigned] dated 04.04.1977, it transpires that the workers who worked in Navasakthi and two others have signed and that Thiru Meenatchi Sundaram who was the General Secretary of National Working Journalists represented the workers and that as per the settlement money was given and the said Thiru Meenatchi Sundaram was not alive at present. At this juncture, it is pertinent to point out that RW. 2 in his cross examination has specifically stated that Ex. R.5 settlement document is not related to the members and that of the first appellant/deceased.
29. It is relevant to mention that the finding given by the third respondent/Labour Court in its award in C.P. 147/1981 dated 24.04.1989 that the mere fact that the first respondent had paid a sum of Rs. 32,475.11 to P.W. 1 would not conclusively prove that the first respondent had purchased the movables and immovables with all its machineries situated at Door No. 106-107 with its liabilities from the second respondent is not correct, in our considered opinion. As far as the first appellant/deceased is concerned, there is no retrenchment. In reality, though the first appellant/deceased succeeded in the earlier award in I.D. No. 138/1967 the established fact is that he was no reinstated and resultantly, he was constrained to file successive claim petitions before the Labour Court. In Ex. P.3-Newspaper dated 23.06.1988, the manner of printing as 'edited and published by K. Kesavan, M.A., and printed by Thangarajan from Navasakthi press, 106-107, Kutchery Road, Madras-4', the finding of the third respondent/Labour Court in its order in C.P. No. 147/1981 dated 24.04.1981, that it would not be conclusive that the first respondent was conducting the said newspaper along with the second respondent/Management, in our view, is not correct.
30. In the case on hand, an important factor to be borne in mind is that when all workmen were paid according to the direction given by the Assistant Labour Commissioner, after the closure of the second respondent on and from 19.11.1976,it cannot be said by any stretch of imagination that the first appellant/deceased was not entitled to claim a total sum of Rs. 35,198.94 and therefore, the contrary view taken by the third respondent/Labour Court, while passing orders in C.P. No. 147/1981 dated 24.04.1989 is not legally correct, in our considered view. Suffice it to state that Ex. R.5-Settlement as per Section 12[3] of the I.D. Act [unsigned] dated 04.04.1977 has no binding effect on the first appellant/deceased inasmuch as he was not a member of the Workers Union and more so, when he was a journalist.
31. The learned Single Judge, while dismissing WP. No. 15904/1991 on 14.06.1999 has observed that when the matter came up for hearing today, for arguments, learned Counsel for the first respondent/Management produced a magazine Navasakthi before this Court asserting that the magazine was published by the same Management and this fact was disputed by the learned Counsel for the petitioner [first appellant/deceased] contending that the Management was not the same as was run by the second respondent and that whether the Management was the same or not was a purely question of fact etc and this observation of the learned Single Judge is not correct, in our view, because of the fact that even as early as on 19.11.1976, the Navasakthi Trust by its notice dated 18.11.1976, discontinued the publication of Navasakthi from 19.11.1976.
32. The fact that the first respondent/Management is the successor interest cannot be disputed inasmuch as the first respondent/Management has taken over the assets and liabilities belonging to the second respondent as a going concern. Further more, since the first respondent/management was a purchaser of the establishment belonging to the second respondent, it is incumbent on the part of the first respondent/management to discharge the encumbrance of the first appellant/deceased and more so, when the first respondent/Management has settled a sum of Rs. 32,475.11 earlier claimed by the first appellant/deceased in C.P. No. 138/1976.
33. From the foregoing discussions, we come to the conclusion that the writ appeal in WA. No. 210/2000 and claim petition in C.P. No. 147/1981 [in entirety] are to be allowed and accordingly, the same are allowed setting aside the orders passed by the learned Single Judge in WP. No. 15904/1991 dated 14.06.1999 and the orders passed by the third respondent/Principal Labour Court in C.P. No. 147/1981 dated 24.04.1989 [relating to the period 23.3.1976 to 28.02.1981] for backwages with bonus claim thereto]. No costs.
34. The first respondent/Management is directed to pay a sum of Rs. 35,198.94 as claimed in C.P. No. 147/1981 to the legal heirs of the first appellant/deceased, viz., appellants 2 to 4 within a period of one month from the date of receipt of a copy of this order.