Madras High Court
Sri Seetha Venkatesh Mills Ltd vs The Thasildhar on 9 February, 2012
Author: R. Sudhakar
Bench: R. Sudhakar
IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 09.2.2012 CORAM: THE HON'BLE MR. JUSTICE R. SUDHAKAR W.P.Nos. 23666 & 23762 of 2002 ........ WP No. 23666 of 2002 Sri Seetha Venkatesh Mills Ltd., rep. By its Managing Director, Mr.OAA .Ananthapandmanaban Chettiar, having its Registered Office at 387 Sembium Road, Kathirvedu, Puzhal Post, Chennai.66. .... Petitioner Vs. 1. The Thasildhar, Ambattur, Chennai. 2. Sounderrajan ... Respondents WP No. 23762 of 2002 Sri Seetha Venkatesh Mills Ltd., rep. By its Managing Director, Mr.OAA .Ananthapandmanaban Chettiar, having its Registered Office at 387 Sembium Road, Kathirvedu, Puzhal Post, Chennai.66. .... Petitioner Vs. The Thasildhar, Ambattur, Chennai. ... Respondent Petitions filed under Article 226 of the Constitution of India to issue a Writ of Certiorarified Mandamus calling for the records of the respondent herein relating to the distraint order No.181, & 182 respectively dated 21.6.2002 in Form No.1 under Section 8(10) of Act 2 of 1865 and quash the same and consequently forbear the respondent from in any manner demanding, collecting or taking distraint proceedings against the petitioner for recovery of the Gratuity dues pending proceedings under the Sick Industrial Companies (Special Provisions) Act 1985. For Petitioner : Ms.AL.Gandhimathi For Respondents : Mr. I. Arokiyasamy Govt. Advocate No Appearance R2 (In WP.23666/2002) COMMON ORDER
These writ petitions are filed praying to issue a Writ of Certiorarified Mandamus to call for the records of the respondent herein relating to the distraint order No.181, & 182 respectively dated 21.6.2002 in Form No.1 under Section 8(1) of Act 2 of 1865 and quash the same and consequently forbear the respondent from in any manner demanding, collecting or taking distraint proceedings against the petitioner for recovery of the Gratuity dues pending proceedings under the Sick Industrial Companies (Special Provisions) Act 1985.
2. The petitioner challenges the destraint order passed by the Tahsildar for recovery of gratuity payable to the retired workman of the petitioner company. The writ petitions have been filed on the premise that since the petitioner company is declared as sick industry under Section 3(1)(o) of the Sick Industrial Companies Act 1985 and since the draft scheme for rehabilitation has been submitted by the petitioner before the B.I.F.R. Under Section 16 and 17 and in view of Section 22 of the Act, distraint proceedings is bad.
3. In view of the Full Bench decision of this Court in M/s. Gowri Spinning Mills (P) Ltd., - Vs. - Assistant Provident Fund Commissioner, Salem and another reported in 2006, 4, LW. 995 wherein it has been held in paragraph 30 and 34 as follows:-
" The aforesaid judgment of the learned single judge thus holds that Section 22 (1) of the SICA must be reasonably construed to refer to only those proceedings which are not required for the day-to-day operation of the company, and therefore, a proceeding for recovery of earned wages would not fall within the purview of Section 22(1). A similar view has been taken by the Bombay High Court, to which one of us (A.P.Shah C.J.,) was a party in Modistone Ltd. V. Deputy Commissioner of Labour, 1999, II, LLJ 1043(Bom) wherein it was held that Section 22(1) of the SICA would not operate in the field of payment of wages, gratuity and other statutory benefits payable to the workmen. It was noted that the Judgment delivered by Justice B.N.Srikrishna in Baburao P. Tawades case (cited supra) was approved in the case of Girni Kamgar Sanghatana Samiti V. Khatau Mackanji Spinning ands Weaving Co. Ltd., 1998 II LLJ 264 (Bom) and that a special leave petition filed against the said judgment was rejected by the Supreme Court. The position of law summed up in the said judgment is as follows:-
(9). Thus, it is a settled law that it is not open for the company to take shelter of Section 22 in respect of the workers wages and other dues. A feeble attempt was made by Mr.Vasudeo to distinquish the above judgment by contending that the present case relates to the payment of gratuity to the workmen and since such claim is in the nature of arrears, the case would be governed by the decision of the Apex Court in Tata Davy Ltd., - V. State of Orrisa and Ors. (supra) I am unable to accept the submission made by the learned counsel for the petitioners. By no stretch of imagination gratuity can be called arrears of wages. The basic minimum which the workmen is entitled to get is the wages and the gratuity and other statutory benefits.
(34) The unreported judgment of the Division Bench of this Court in Writ Appeal No.1831 of 2001 seems to have proceeded on the assumption that Section 22(1) of the SICA is implicitly applicable to the workers dues as well as their claims for gratuity, provident fund, etc. The Division Bench has not considered the reported judgment of other Courts and the effect of the amended Section 14-B of the EPF Act. In T. Venkatasan V. District Collector, Tiruvallur, 2004(1) LLJ 133(Mad.) a learned single Judge of this Court following the unreported decision of the Division Bench of this Court in Writ Appeal No.1831 of 2001 has held that the protection granted to the sick companies under Section 22 of the SICA against levy or execution or distress proceedings without consent of the BIFR or Appellate Authority cover proceedings for recovery of gratuity. In our opinion, the unreported decision of the Division Bench of this Court in Writ Appeal No.1831 of 2001 and the decision of the learned single Judge in T. Venkatesan V. District Collector, Tiruvallur (cited supra) do not lay down the correct law. Section 22 of the SICA would not operate in the filed of payment of wages, gratuity and other statutory benefits payable to the workmen."
In view of the above full Bench decision, section 22 of the SICA will have no application to the Provident Fund dues in respect of the claims for gratuity. The provisions of the Employees Provident Fund Act would not come within the purview of SICA.
4. In the result, both the writ petitions are dismissed. The authority shall take into consideration the payments made by the petitioner company pursuant to the interim orders of this Court for settlement. No costs.
09.2.2012 ra Index: Yes/No Internet: Yes/No To The Thasildhar, Ambattur, Chennai.
R. SUDHAKAR,J., ra WP Nos. 23666 & 23762/2002 Date: 09.2.2012