Karnataka High Court
Sri Rajashekar S/O Sri.Halagappa vs The Management Of Davanagere Cotton ... on 12 February, 2013
Author: Ravi Malimath
Bench: Ravi Malimath
1
IN THE HIGH COURT OF KARNATAKA AT BANGALORE
ON THE 12th DAY OF FEBRUARY 2013
BEFORE
THE HON'BLE MR.JUSTICE RAVI MALIMATH
WRIT PETITION NO.662 OF 2007 (L-TER)
C/W
WRIT PETITION NO.1024 OF 2006 (L-TER)
WRIT PETITION NO.662/2007:
BETWEEN:
Sri Rajashekar
S/o Sri Halagappa
Aged about 58 years
R/at D.No.142, SPS Nagar,
Budalu Ring Road,
3rd Cross,
Davanagere - 577 001. ... PETITIONER
(By Sri V.S.Naik, Advocate)
AND:
1. The Management of Davanagere
Cotton Mills Limited,
P.B.No.201, Hanumanthappa Building,
Chitradurga Road,
2
Davanagere - 577 002
Represented by its General Manager (Adm.)
2. The Chairman
M/s.Morarji Gokuldas Spinning and
Weaving Company Limited,
Having its Registered Office,
At Dr.Ambedkar Road,
Mumbai - 400 012.
3. Peninsula Land Limited
Dr.Ambedkar Road,
Mumbai - 400 012. ...RESPONDENTS
R3 Amendment as per order dated 12.2.2013
(By Sri Somashekar, Advocate for
M/s.S.N.Murthy Associates, Advocates)
*****
This Writ Petition filed under Articles 226 and 227
of the Constitution of India praying to quash the
common award passed by the Principal Labour Court,
Hubli, in KID, Nos.165/2000 dated 18.4.2005, a true
copy of which is produced and marked as Annexure-A,
Since the Labour Court has Committed Several errors
which are apparent on the face of the records and that
the award of the Labour Court is wholly opposed to the
provisions of ID.Act 1947.
WRIT PETITION No.1024/2006:
BETWEEN:
1. Sri Basavaraja
S/o Sri Gulyappa
3
Aged about 41 years
2. Sri Hanumanthappa
S/o Sri Nellagiriyappa
Aged about 50 years
3. Sri Siddappa
S/o Sri Honnurappa
Aged about 45 years
4. Sri Nagesh
S/o Sri Sheshagirirao
Aged about 45 years
5. Sri Syed Mujib
S/o Sri Syed Fakkurddinsab
Aged about 44 years
6. Sri U.M.Laxmappa
S/o Sri Mareppa
Aged about 46 years
7. Sri Jameerkhan
S/o Shabbir
Aged about 35 years
8. Sri Maheshwar Rao
S/o Sri Subbarao
Aged about 47 years
9. Sri N.Anjaneya
S/o Sri Narasimhappa
Aged about 50 years
10. Sri T.Prakash
S/o Sri Thimmappa
4
(Since deceased represented by his LRs)
a. Smt.Anasuyamma
W/o late T.Prakash
Aged about 40 years
b. Kum.Pankaja
D/o late T.Prakash
Aged about 21 years
c. Kum.Shilpakala
D/o late T.Prakash
Aged about 19 years
d. Kum.Sakamma
D/o late T.Prakash
Aged about 17 years
e. Kum.Chandrakala
D/o late T.Prakash
Aged about 11 years
f. Sri Karibasavva Swamy
S/o late T.Prakash
Aged about 8 years
(Petitioners 'e' and 'f' being minors,
They are represented by their mother and
Natural guardian Smt.Anasuyamma)
11. Sri N.C.Mahesh
S/o Nagarada Chikkappa
Aged about 50 years
12. Sri Veerachari
S/o Sri Veerappa Kammar
5
Aged about 47 years
13. Sri R.B.Ramappa
S/o K.B.Rudrappa
Aged about 38 years
14. Sri Jamaluddin
S/o Sabjansab
Aged about 52 years
15. Sri A.Vijayendra
S/o Basappa
(Since deceased by his LRS)
a. Smt.Shivamala
W/o late Vijayendra
Aged about 40 years
16. Sri M.Krishnoji Rao
S/o Jyothiba Rao
Aged about 50 years
17. Sri Ramappa
S/o Sri Ajjappa
Aged about 48 years
18. Sri Rama
S/o Sri Hanumanthappa
Aged about 42 years
19. Sri Mohammad Ibrahim
S/o Sri Abdul Ghanisab
Aged about 43 years
20. Sri Syed Mohmed
S/o Sri Syed Rahiman
6
Aged about 50 years
21. Sri Srinivas
S/o V.Arunchalam Pillni,
Aged about 45 years,
22. Sri I.N.Kammar
S/o Sri Nagappa
Aged about 46 years
All the petitioners can be served at
1st petitioner Mr.Sri G.Basavaraj
S/o Sri Gulyappa,
R/o K.B.Extension, H.No.754
Beside Kaveramma School,
4th Main, II Cross,
Davanagere ... PETITIONERS
(By Sri V.S.Naik, Advocate)
AND:
1. The Management of Davanagere
Cotton Mills Limited,
P.B.No.201, Hanumanthappa Building,
Chitradurga Road,
Davanagere - 577 002
Represented by its General Manager (Adm.)
2. The Chairman
M/s.Morarji Gokuldas Spinning and
Weaving Company Limited,
Having its Registered Office,
At Dr.Ambedkar Road,
Mumbai - 400 012.
7
3. M/s.Peninsula Land Limited
Dr.Ambedkar Road,
Mumbai - 400 012. ...RESPONDENTS
R3 Amendment as per order dated 12.2.2013
(By Sri Somashekar, Advocate for M/s.S.N.Murthy
Associates, Advocates)
******
This Writ Petition filed under Articles 226 and 227
of the Constitution of India praying to quash the
common award passed by the Principal Labour Court,
Hubli, in KID, Nos.142/2000; to 153, 155 to 162,
190/2000 and 191/2000 dated 18.4.2005, the certified
copy of which is produced and marked as Annexure-H,
Since the Labour Court has Committed Several errors
which are apparent on the face of the records and that
the award of the Labour Court is wholly opposed to the
provisions of ID.Act 1947.
These Writ Petitions coming on for hearing this
day, the Court made the following:-
ORDER
The case of the workmen is that they were all permanent employees of the respondent - and were working in different capacities since many years. The mill was established in the year 1934. It was registered 8 under the provisions of the Indian Companies Act, 1956.
2. It is their case that between 1960 and 1970, the mill employed almost five thousand employees. It is one of the pioneer textile industry in the erstwhile State of Mysore. However, for various reasons the mill suffered losses. During the year 1990, it was declared as a sick industry. The matter was referred to the Board for Industrial and Financial Reconstruction (BIFR). Thereafter, the mill was taken over by Morarji Gokuldas Spinning and Weaving Company Limited, Bombay. Hence, it became a unit of M/s. Morarji Gokuldas Spinning and Weaving Company Limited and they continued to run the mill.
3. Thereafter, somewhere in the year 1998, a Voluntary Retirement Scheme was propounded. Initially, about 280 employees opted for the same. 9 Subsequently, other employees also opted for the same. As a result whereof, only 24 employees remained, who did not opt for the Voluntary Retirement Scheme.
4. Under these circumstances, on 23.07.1999 an original suit was filed by these 24 employees to restrain the company from dealing with the land and transferring of the machineries and raw-materials. However, no interim order was granted and the CRP filed by them was also rejected.
5. Thereafter by means of a notice dated 16.07.1999, the operations of the mill stood suspended. The petitioner and other similarly situated workmen thereafter moved the Labour Court for issue of a recovery certificate claiming wages with effect from 16.07.1999, namely the date on which the employer displayed a notice that the management had resorted to suspension of operations. Simultaneously, a request 10 was made to hold conciliation proceedings to provide them employment and to pay the arrears of salary.
6. Thereafter, by a letter of termination dated 03.07.2000, the petitioners were terminated from their services w.e.f. 07.07.2000. Aggrieved by the same, a claim petition was set up before the Labour Court under Section - 10(4-A) of the Industrial Disputes Act, 1947. All the claim petitions were heard together. By the impugned common award, the Labour Court dismissed the claim petitions. Hence, the present petitions are filed by the workman questioning the same. Since the petitioners are challenging the very same award, at the request of the learned counsels, they are taken up for consideration together.
7. The learned counsel for the petitioner Shri.V.S. Naik, contends that the order passed by the Labour Court is erroneous. That the Labour Court failed to 11 understand the true scope and intention of the claim of the petitioners and it failed to understand the provisions of the Chapter V and VB of the Industrial Disputes Act. That the respondent's company has acted in a malafide manner in firstly reducing the workforce to less than 100 members and thereafter by taking advantage of Law, to terminate the services of the petitioners.
8. It is contended that the Voluntary Retirement Scheme was not a bonafide scheme. That the object of the company was to do business in real estate. The documentation as produced by the respondents themselves, in terms of Annexure - R1 and R2 of the statement of objections would show that the name of the company was changed from Morarji Gokuldas Spinning and Weaving Company Limited to Morarji Realities Limited in the year 2004. In the year 2006, the name of the Morarji Realities Limited was changed to Peninsula Land Limited. It is therefore apparent, that 12 based on the certification produced by the respondents themselves, there was no intention for the respondents to run the mill and the only object was to secure land in order to do business in real estate. It is therefore pleaded that the action of the respondents has been wrongly appreciated by the Labour Court. That the Labour Court committed an error in holding that the provisions of Chapter V and VB of the Act are not applicable to the case on hand.
9. On the other hand, Shri.Somashekar, the learned counsel for the respondents defends the impugned order. He contends that the plea of the petitioners cannot can be accepted. None of the allegations made against the respondents are within the purview of Law and that the action that are initiated and continued by the respondents are within the framework of Law. The facts would disclose that they were 24 workmen as on the date of closure. Therefore, 13 the provisions of Chapter V and VB are not applicable to the respondents.
10. It is an undisputed fact that Davangere Cotton Mill was taken over by Mararji Gokuldas Spinning and Weaving Company Limited and thereafter the name was changed to Morarji Realities Limited and subsequently, to Peninsula Land Limited. There is no illegality committed by the respondents in terms of Law. The workmen have been terminated in accordance with law and their services and their dues have been paid off and therefore they cannot contend that the action of the respondent is beyond the purview of Law. The contentions of the petitioners are not legal and hence the Writ petition requires to be dismissed.
11. Heard learned counsels.
12. The contention of the petitioners is that in terms of Chapter-V of the Industrial Disputes Act, the 14 same would stand applicable to the case on hand. That the plea of the respondents that the number of employees stands reduced to 24 cannot be accepted. By placing reliance on the Scheme of amalgamation, he contends that the employees of DCM would become the employees of M/s.Morarjee Gokuldas Spinning & Weaving Company Limited. He places reliance on Clause 14(2) of the scheme of amalgamation to contend that the transferee Company is entitled to all the debts, dues of the transferor Company on amalgamation having taken place. Further reliance is placed on Clause 28 to contend that all the employees of the transferor Company as on the effective date shall become the employees of the transferee Company on the basis that their services would not be interrupted by vesting of the transferor Company with the transferee Company. Referrence is made to Clause 22 to state that upon merger, the transferor Company would stand 15 dissolved without orders of winding up. It is therefore pleaded that all the employees become part and parcel of the Spinning Mills. The question of the respondent DCM being a separate unit does not arise.
13. On the contrary, the learned counsel appearing for the respondent does not dispute the plea so far as amalgamation is concerned. He contends that DCM has since been amalgamated or merged with Morarjee Spinning Mills and there is no dispute with regard to the same. However, what is sought to be contended is that DCM was treated as a separate Unit bereft of any control from its parent Company. Furthermore, what is sought to be pleaded by the petitioners is not whether the amalgamation or otherwise is justified or not, but whether these 24 workmen could be terminated and that such a termination is in accordance with the Industrial 16 Disputes Act. In any establishment where there are more than 100 workman, necessary permission would have to be obtained from the Central Government for the purpose of closure. In the instant case, the plea put forth is that there are more than 100 workmen. Admittedly the number of workmen at DCM were only
24. Therefore so far as termination is concerned the same is in accordance with law.
14. The Tribunal while considering the said issue was of the view that there is no material to show that DCM Mills and the Bombay Spinning Mills are one and the same. That there is no functional integrality. That no material has been produced by the workmen to that effect. Further, that since there were less than 50 workmen at the relevant point of time the provisions of Section 25-FFFA or Chapter V-A OR V-B or 25-(N) or 25(O) are not applicable to the case on hand. That the respondent has complied with Section 25-FFF of the 17 Act. For these reasonings the tribunal rejected the plea put forth. The reasoning assigned are just and proper. I do not find any good ground to interfere. In view of the admitted position that there were less than 50 workmen at DCM, I do not find any law that has been flouted that may be held against the management. Hence, so far as this contention is concerned I do not find any good ground to interfere.
15. The next contention urged by the petitioners is that the orders of termination dated 3rd July, 2000, is unwarranted. That they could have been absorbed by the Mills at Bombay or by absorption in any of the other Units. The same has not been done. Therefore the order of termination in terms of Annexure-A is wholly unjustified.
18
16. The contention of the respondent is to the effect that there is no continuous running of the two units. That both the Units are different. The question of the employees being transferred to the Unit at Bombay does not arise for consideration. Even though some of the employees were offered employment at Bombay they were not in pursuance to any statutory requirement. They have done so on humanitarian considerations. Therefore the question of considering the order of termination being proper or improper on grounds of morality would not be a consideration in as much as the only consideration should be as to whether the termination is valid in the eyes of law. In law in view of the fact that the number of employees being less than 50, the provisions of Section 5-B not being attracted, it cannot be said that there that there is any violation of law that is committed by the respondents. The propriety or otherwise, the morality or otherwise of 19 the order of termination would not be a matter for adjudication so far as the petitioners are concerned. Under these circumstances, I'am of the considered view that the order of termination is in accordance with law. Under these circumstances, I'am of the considered view that there is no error that calls for any interference. The order passed by the Tribunal is just and proper. It cannot be said that the action of the respondents in closure as well as in the termination of the employees is in not in accordance with law. The contention of the petitioners that it is an improper closure would not arise for consideration since there is no violation of any law so far as closure or termination is concerned. Consequently the Petitions being devoid of merit, are dismissed.
Sd/-
JUDGE JJ & Rsk/-