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[Cites 34, Cited by 0]

Madras High Court

Indian Oxygen Employees Union vs Union Of India Rep. By The on 12 January, 2009

Author: M.Sathyanarayanan

Bench: D.Murugesan, M.Sathyanarayanan

       

  

  

 
 
 In the High Court of Judicature at Madras 

Dated:-12-01-2009

Coram:

The Honourable Mr.Justice D.MURUGESAN
and
The Honourable Mr.Justice M.SATHYANARAYANAN

Writ Appeal No.286 of 2003

1. Indian Oxygen Employees Union
    rep. by its General Secretary, 
    75, Vaidyanathan Street, 
    Tondiarpet, Chennai - 600 001.

2. V.Srinivasan, 
    Flat No.6, Krishna Apartments,
    52, T.M.Maistry Street, 
    Tiruvanmiyur, 
    Chennai - 600 041. 						   ..   appellants
Versus

1. Union of India rep. by the 
    Secretary, Ministry of Labour,
    Shram Shakti Bhavan, 
    New Delhi. 

2. B.O.C. India Ltd., 
    rep. by its Operations Manager, 
    75, Vaidyanathan Street, 
    Tondiarpet, Chennai - 600 001.

3. Datex Ohmeda India (P) Ltd., 
    rep. by its Zonal Manager, 
    75, Vaidyanathan Street, 
    Tondiarpet, Chennai - 600 001.		       		   .. Respondents

	Writ Appeal filed under Clause 15 of the Letters Patent against the order of the learned single Judge dated 28.10.2002, made in W.P.No.17633 of 1998.  

	For appellants 	..	Mr.N.G.R.Prasad for 								M/s. Row & Reddy.
	For Respondents	..	Mr.K.Mohanamurali (SCGSC) for R1.
					Mr.A.L.Somayaji, S.C. for 
					M/s. Gupta and Ravi for R2. 
					Mr.V.Karthik for 
					M/s T.S.Gopalan VOC for R3. 
*******
JUDGMENT

M.SATHYANARAYANAN, J The appellants are the writ petitioners and aggrieved by the dismissal of the writ petition, had preferred this appeal.

2. The facts which are necessary for the disposal of this writ appeal are as follows:-

The second appellants herein joined the services of Indian Oxygen Limited (in short IOL) as Typist on 08.11.1965. IOL was a Public Limited Company with its head office at Calcutta and it was manufacturing Industrial Compressed Oxygen, Medical Oxygen, Dissolved Acetylene, Anaesthesia gas, Liquid Oxygen, Argon Gas, Hydrogen Gas and various other high speciality gases. IOL besides manufacturing various kinds of Industrial and medical gases, was also manufacturing Electrodes, Welding Equipments, Medical apparatus like Boyle's and other medical accessories.

3. In the year 1995, the name of IOL was changed to B.O.C India Limited (Second Respondent). The second appellants was posted to work at Trichy as Clerk-cum-Typist in the Sales Office of the second respondent. On 3.11.1978, the second appellants was promoted as Stenographer Grade II and posted to Accounts Department at Chennai. On 07.01.1988, he was promoted as Stenographer Grade I and posted to Health Care Products Division. The Welding Division of the second appellants was sold to ESAB India Limited on 21.05.1991 and some employees were transferred on account of the said sale.

4. The first appellants Union objected to the transfer of some employees as they did not want to serve under the new employer on the ground that they were not working in any separate undertaking, but in the Office/Establishment situated at Chennai which was not a separate undertaking. The first appellants Union also filed a suit in C.S.No.741 of 1991 on the file of this Court and obtained an order of ad-interim injunction in O.A.No.483 of 1991 against transfer of employees. The said interim order was also made absolute on 25.10.1991. Consequently, the second respondent continued to engage their services. Even though, the manufacturing of Medical Equipments existed in the form of a separate factory at Calcutta, it ceased to exist after 1991 and the second respondent company called the business of handling medical equipments etc., as "MEDISHIELD". According to the appellants herein, there was no separate undertaking called medical division run by the second respondent company.

5. It is further contended by the appellants/writ petitioners that the employees are transferred from one post to other anywhere in the establishment and there is a common seniority list maintained for all the sections and hence, OHMEDA is not an independent division in the nature of an undertaking and the employees posted at a particular time in that division do not belong to that division.

6. The order of appointment pertaining to the second appellants does not contain the name of a particular department and thereby his service could be utilised in all the departments of the second respondent. The second appellants is also an active member of IOL Employees' Union and is holding the post of Joint Secretary and therefore, he is the protected workmen under the ID Act.

7. The appellants/ writ petitioners further averred in their affidavit that All of a sudden, the second appellants has published a letter dated 30.9.1998 in the Company's Notice Board on 7.10.1998 stating that OHMEDA Division has been sold to one DATEX OHMEDA INDIA PVT LTD., - third respondent and that simultaneously, the staff who are working in the said division are transferred to the third respondent. The second appellants neither sought the consent of the affected employees nor hold any discussion with the first appellants Union before transferring their services to the third respondent and the decision of the second appellants was an unilateral one and it has been exercised in an arbitrary manner affecting the rights and privileges enjoyed by the employees. The appellants/writ petitioners further contended that the second appellants in all fairness, should have resorted to the benevolent provision contained under Section 25-N of the Industrial Disputes Act and thereby they should have drawn up a seniority list and the second appellants being the senior most, ought not to have been retrenched. The second respondent in order to circumvent the said provision, had resorted to Section 25-FF of the Industrial Disputes Act and hence the said provision is in violation of Article 14 and 21 of the Constitution of India. The services of the second appellants with the second respondent entitled him with pension and higher rates of bonus etc., which will not be available in the event of the transfer of his services to the third appellants. Since the second appellants is a large establishment more than 100 workers, they are entitled to the protection of Chapter V-B of the Industrial Disputes Act, which prohibits lay off, retrenchment and closure without prior permission of the Government. The second respondent who is the public limited company of repute, whereas the third respondent company is a private limited company, whose credentials are not known to the appellants/writ petitioners. All workers who were former members of the appellants Union and who were transferred to the services of the third respondent have not been paid Rs.160/- per month towards health and hygiene and prosperity sharing amount for the month of October 1998 and they were also denied canteen facility.

8. Therefore, the appellants/writ petitioners filed a writ of declaration to declare that Section 25-FF of the Industrial disputes Act, 1947 is unconstitutional to the extent that it does not require the consent of workmen for transfer of his services and the transfer of an undertaking and consequently direct the second respondent to continue the services of the second appellants/second writ petitioner in service from 1.10.1990 and pay him all the wages etc., or in the alternative, prayed for the issuance of the writ of declaration to declare that the sale effected by the second respondent in favour of the third respondent vide notice dated 30.9.1998 does not constitute the transfer of undertaking as per the proviso to Section 25-FF of the Industrial Disputes Act 1947 and consequently directed the second respondent to continue the services of the second appellants in the same manner as before 1.10.1998 without any interruption and pay the arrears of wages and other benefits.

9. The interim orders sought for by the appellants/writ petitioners were not granted. The second appellants agreed to join the services of the third respondent without prejudice to his contentions raised in the writ petition. The third respondent sent a communication dated 8.6.1999 to the second appellants herein refusing him to join duty as he had forfeited the right to be in employment with them.

10. This Court vide order dated 1.10.1999 by way of an interim measure directed the second respondent herein to pay the second appellants a sum of Rs.6,400/- per month from 1.11.1999 for the reason that the third respondent herein had refused to provide him with employment. The appeal preferred by the management against the said order in writ appeal No.2314 of 1999 was dismissed on 21.1.2000 and thereby confirming the above said interim order.

11. The second respondent has filed its counter affidavit. It is contended in the counter affidavit that a writ is not maintainable against the second respondent as it is only a public limited company and not performing any public duty. Since the issues raised by the appellants herein require adjudication of disputed questions of fact, they are not entitled to invoke the extraordinary jurisdiction of this Court under Article 226 of the Constitution of India.

12. As regards the transfer of undertaking in favour of the third respondent is concerned, the second respondent contended that it has a separate division to look after the sale of Health Care Equipments under the name and style of " OHMEDA" and its activities are totally different and is severable from other units of the shops or undertaking. The employees engaged in "OHMEDA" division are exclusively doing work which are related with sales and service of the products of "OHMEDA" division and the said division is dealing with Health Care products in a separate business establishment. It is stressed by the second respondent that "OHMEDA" division is a separate undertaking and its activities are severable from other units of the shops and sale of the said division will not affect the working of the main activities of the second respondent which manufacturing industrial and medical gas.

13. The second respondent further contended that the "OHMEDA" Health Care product division has been transferred from the second respondent to the third respondent not only in India, but through out the world and in this country, the transfer of undertaking took place under the agreement dated 24.9.1998 with effect from 1.10.1998. In pursuant to the said decision, the staff belong to the first appellants union including the second appellants stood transferred to the third respondent and in all, 15 officials became employees of the third respondent in the entire South Zone and all of them, have been exclusively work in the "OHMEDA" division and they have been continuous service carrying out of the work of the said division immediately before such transfer.

14. The second respondent also contended in the counter that the services of the second appellants and other officials were agreed to be taken by the third respondent without any break or interruption in their service on the same terms and conditions including retirement benefits and it is not in any way less favourable than those applicable to them immediately before the transfer of undertaking. On and from 7.10.1998 onwards, the second appellants became employees of the third respondent by virtue of transfer of undertaking.

15. With regard to the Constitutional validity of Section 25-F of the Industrial Disputes Act, 1947, the second respondent contended that the Legislature does not curb the right of the employer to retrench, terminate or close an undertaking but on the contrary, has imposed certain restrictions which are reasonable and as contemplated under Article 19(6) of the Constitution of India. A provision has also been made for payment of compensation to workmen as and when they are retrenched in the event of transfer of undertaking. In the case on hand, the service of the second appellants and others have not been terminated but their service conditions have been protected by the third respondent.

16. The second respondent contended that there has been a bona fide transfer of undertaking by "OHMEDA" division and such transfer of undertaking or sale of undertaking is recognised in law and Section 25-FF came to be incorporated in the Industrial Disputes Act, taking into consideration the interest of the workmen. That apart, sale or transfer of an undertaking, cannot be questioned on the ground it amounts to change in service conditions as contemplated under Section 9A of the Industrial Disputes Act. Therefore, for the said reasons, the second respondent prayed for the dismissal of the writ petition.

17. The learned Judge, after taking into consideration the averments made in the writ petition and the counter affidavit of the second respondent and also the judgments reported in :

(1) R.S.Madho Ram & Sons (Agencies) v. ITS Workmen 1964 (1) L.L.J. page 213) (2) P.K.P. Bidi Factory v. O.L.Thenge (A.I.R.1970 S.C. page 823), (3) J.N.U. v. DR.K.S.J. Awatkar & others (A.I.R.1989 S.C. 1577 = 1989 (2) L.L.J. page 586) and (4) Voltal Volkart Employees Union v. Voltas Ltd., (1999 (4) L.L.N. page 1107), held that Section 25-FF safeguards the interest of the workmen and that the consequential relief of directing the second respondent to continue the services as it had been prior to 1.10.1998 and that consequential reliefs cannot be granted. The learned Judge for the said reasons, has dismissed the writ petition and the writ petitioners aggrieved by the same, had preferred this writ appeal.

18. Heard Mr.N.G.R.Prasad, learned counsel appearing for the appellants and Mr.K.Mohanamurali, learned Senior Central Government Standing Counsel appearing for the first respondent and Mr.A.L.Somayaji, learned senior counsel appearing for M/s. Gupta and Ravi, for the second respondent and Mr.V.Karthik, for Mr. T.S.Gopalan, and Co., learned counsel appearing for the third respondent.

19. As regards the maintainability of the writ petition, it has been contended that the writ petition was filed in the year 1998 and the second appellants herein had superannuated in August 2003, had he been continued in the service of the second respondent and now the second appellants is aged about 65 years. Therefore, at this distance of time, it would be wholly unjustifiable to direct the second appellants to avail the alternative remedy.

20. The learned counsel appearing for the appellants heavily placed reliance upon the judgment of the Hon'ble Supreme Court of India, reported in 2008(1) L.L.N. 1(SC) - BCPP Mazdoor Sangh and another v. N.T.P.C. and others.

21. The facts of the said case are:- that the members of BCPP Mazdoor Sangh are employees recruited by National Thermal Power Corporation (NTPC) by calling for list of names from the Employment Exchange and were appointed by following the procedure. Steps were being taken for transferring them to Bharat Aluminium Company Limited (BALCO) which was originally a public sector undertaking under the Government of India. Subsequently, in pursuant to the policy of disinvestment, the entire management became vested with M/s. Sterlite under agreement dated 20.6.2002, with effect from 1.7.2002. The Union aggrieved by the said decision of transfer from public sector undertaking to private management, had challenged the same by filing writ petition before the High Court of Chhattisgarh and they mainly prayed for an order declaring that Clause 8.2 and 16.3 of the agreement with Sterlite is illegal, arbitrary and unenforceable against them who are non-executive workers as it unilaterally changes the service conditions of all those employees who are not party to the agreement. The Union also sought for an order of injunction restraining the management from enforcing the above said clauses. The respondents filed counter stating among other things raising the maintainability of the writ petition as it involves interpretation of contractual rights between the parties. It is further contended that NTPC is merely an agent of BALCO on a specific power of attorney given to them and the ownership of BCPP belongs to BALCO. Recruitment was given pursuant to an agreement exclusively for BCPP with specific undertaking from the non-executive employees and they know pretty well the meaning of undertaking and therefore, have no right to question the agreement between BALCO and NTPC. The offer of appointment as well as the undertaking given by the employees specifically bring out the above fact and besides, the operation and maintenance agreement signed between the NTPC and BALCO makes it clear that the recruitment made by NTPC is specifically for BCPP and in the event of transfer of operation and maintenance of BCPP to any other agency, the services of such employees will be transferable to the successor agency. Based on the said agreement, various administrative actions were taken and which were taken only on behalf of BALCO and not for NTPC. It is further contended by the management in the said case that once BCPP owned by BALCO is taken over by BALCO, the entire non-executive staff of BCPP will continue to remain in BCPP under the management of BALCO in terms of Clauses 8.0 and 16.3 of the agreement and once the plant is taken over, if the non-executive employees are not going to BALCO, they will become surplus in the hands of NTPC and therefore, NTPC will left with no other option except to retrench their services.

22. The High Court of Chhattisgarh after taking into consideration the rival contentions, held that the writ petition filed by the employees are maintainable and the terms and conditions, more particularly, Clauses 8.0 and 16.3, are accepted by the employees and adhered the stand taken by the management. Therefore, it dismissed all the writ petitions. Hence, the matter was taken by way of appeal to the Hon'ble Supreme Court of India. The Hon'ble Supreme Court of India uphold the view of the High Court of Chhattisgarh in so far as the maintainability of the writ petition, On the factual aspects, the Hon'ble Supreme Court of India held that the bipartite agreement between NTPC and BALCO was entered into on 22.05.1990 and that the appointments of 236 employees were made prior to the said date and at the time of recruitment and appointment made by NTPC, no agreement between NTPC and BALCO was in existence empowering NTPC to make recruitment and appointment on behalf of BALCO. Hence, the Hon'ble Supreme Court of India held that as per Clause No.21.0 of the agreement, the effective date and duration of agreement with effect from 29.6.1987, is contrary to the provisions of Section 23 of the Indian Contract Act and also in violation of Article 14 of the Constitution of India.

23. The Hon'ble Supreme Court of India, further held that Clause 14.0 of the above said agreement is also against the public policy and contrary to the provisions of Section 23 of the Indian Contract Act as well as violation of Article 14 of the Constitution of India for the reason that undue influence was exercised by NTPC management and the selected candidates exhaust the terms and conditions stipulated therein. As regards the absence of tripartite agreement, it was held in the said decision that in order to appoint the appellants, there must be a tripartite agreement and in the absence of the same, the transfer from one employment to another cannot be effected. It has been further found by the Hon'ble Supreme Court of India that prior to such decision, the employees have not been heard also and therefore the action of the management is an infringement of Article 14 of the Constitution of India. Therefore, for the said reasons, the Hon'ble Supreme Court of India had set aside the decision of the High Court of Chhattisgarh and allowed the appeal filed by the Union.

24. The learned counsel appearing for the appellants submitted that the transfer of the second appellants from the service of the second respondent to third respondent was not on the same terms and conditions as he will not get pension in the new employer namely third respondent and that he will lose the benefit of profit sharing scheme, which the second appellants was getting while he was in service of the second respondent as the third appellants is not a manufacturing concern. Moreover, the second appellants will lose the canteen facility available in the second respondent and also lose the benefit of educational scholarship for his wards. The second appellants will also to be deprived of medical reimbursement of Rs.600/- per year for himself and his wife and also Mediclaim policy benefit available till life time.

25. The learned counsel appearing for the appellants further contended that the consent of the second appellants has not been taken prior to his transfer. In support of his submissions, the learned counsel appearing for the appellants has drawn the attention of this Court to the transfer agreement dated 24.9.1998 and more particularly, to clause No.10.01 which specifically provides that the purchaser will take into services all the employees, who have accepted employment with the new employer. Reliance was also placed upon the judgment of the Industrial Tribunal Mumbai, in Complaint (ULP) No.645 of 1998 between IOL Employees' Union, Mumbai v. BOC India Limited (second respondent), wherein it has been held that the four concerned workmen whose services is transferred to Datex Ohmeda cannot be said legal and proper and the Tribunal ultimately held that the second respondent herein is guilty of unfair labour practice and further directed not to transfer any of the four concerned workmen working in Ohmeda division of the second respondent to other new company Datex Ohmeda India Limited (third respondent) and that in the event of failure to continue their services, the second respondent management is liable to pay retrenchment compensation as stipulated under Section 25F of the Industrial Disputes Act.

26. The learned counsel appearing for the appellants also contended that the transfer of Ohmeda division in favour of the third respondent by the second respondent in any event cannot be construed as a transfer of entire undertaking and only such an event, Section 25FF of the Industrial Disputes Act will apply. Ohmeda division has been transferred by the second respondent in favour of the third respondent and admittedly, the petitioner was originally appointed as a typist in IOL, it later became BOC in the year 1995 and till December 1998 was in the services of the second respondent and after the formation of the Health Care products division, promoted and posted as Stenographer Grade I in the said division and in the year 1995, the Health Care division was renamed as Ohmeda division and in the year 1996 the second appellants was classified as Assistant. The above facts according to the learned counsel appearing for the appellants, would imply that the employees are transferable from one post to another and a common seniority was maintained for all the sections. It is once again stressed by the learned counsel appearing for the appellants that the Ohmeda division is not an independent division and it forms part of the second respondent and admittedly not the entire management and affairs of the second respondent company was transferred in favour of the third respondent but only Ohmeda division. It is vehemently contended by the learned counsel appearing for the appellants that the second appellants was not exclusively appointed in Health Care division and later became Ohmeda division and merely he happen to work at the relevant point of time, it cannot mean that he is in permanent service of the Ohmeda division. There is no factual disputes involved as the second respondent failed to produce any material before this Court to substantiate their claim that Health Care division was a separate undertaking.

27. As regards the validity of Section 25FF of the Industrial Disputes Act, it is contended by the learned counsel appearing for the appellants that the said provision deprives the second appellants of the benefit of compensation as if retrenchment and the same would be unreasonable and arbitrary and also in gross violation of Section 23 of the Indian Contract Act. Alternatively, the learned counsel appearing for the appellants has submitted that there is no transfer of undertaking and consequently Section 25FF of the Industrial Disputes Act has no application on the case on hand and it is to be declared that the second appellants continued to be in the service of the second respondent till the date of his superannuation. Therefore, the learned counsel praying for set aside of the order passed in dismissing the writ petition and allowing of this writ appeal.

28. Per contra, Mr.A.L.Somayaji, learned senior counsel appearing for the second respondent has submitted that the second portion of the prayer namely directing the second respondent to continue the services of the second appellants in service from 1.10.1998 and paying him all the wages etc., is not maintainable as no writ petition will lie against the private body in the absence of discharge of any public function/duties. The remedy if any available to the appellants to invoke the provisions of the Industrial Disputes Act and they cannot maintain the writ petition. That apart, the issue pertaining to the interpretation of the terms of transfer of undertaking it is seriously disputed by the respondents 2 and 3 and on that ground also the writ petition is not maintainable and it is misconceived.

29. The learned senior counsel appearing for the second respondent would further contend that the question regarding the Health Care business is part of undertaking of the second respondent or not is a mixed question of law and facts and the same cannot be adjudicated by this Court in exercise of jurisdiction under Article 226 of the Constitution of India. The Health Care division is a separate undertaking as it does not involve any manufacturing process and the second respondent company even as per the admission of the appellants is manufacturing medical industrial gases. The function of Health Care division and later Ohmeda division is separate and distinct from the activities of the second respondent and therefore the transfer in favour of the third respondent amounts to transfer of undertaking as a whole.

30. With regard to the validity of Section 25FF of the Industrial Disputes Act, learned senior counsel contended that the deemed retrenchment contemplated under the said provision is by agreement between the parties or by operation of law. As per the proviso to Section 25FF, of the Act that if the three conditions specified in the proviso are satisfied, there is no termination of service either in fact or in law and so there is no scope for the payment of any compensation. Admittedly, the service conditions of the second appellants and others who have been transferred to the third respondent, were protected and similar benefits have been provided to them and the contention of the appellants that the service conditions with the third respondent are not similar to them of the second respondent is not correct and dispute with regard to the parity of service conditions can be adjudicated only before the appropriate forum and not before this Court. The learned senior counsel appearing for the second respondent has also took this Court through the averments in the counter affidavit filed by the second respondent in the writ petition.

31. The learned senior counsel appearing for the second respondent in support of his submissions placed reliance upon the following judgments:-

(1) 1960 (1) SCR 703 = 1960 SC 56 = 1960 (1) LLJ 1 - Associated Cement Companies Ltd., vs. Workmen, wherein the proper tests in determining what is meant by "one establishment" have been laid down and it has been held as follows:-
" The Act not having prescribed any specific tests for determining what is one establishment, we must fall back on such considerations as in the ordinary industrial or business sense determine the unity of an industrial establishment, having regard no doubt to the scheme and object of the Act and other relevant provisions of the Mines Act, 1952, or the Factories Act, 1948. What then is one establishment in the ordinary industrial or business sense? The question of unity or oneness presents difficulties when the industrial establishment consists of parts, units, departments, branches etc. If it is strictly unitary in the sense of having one location and one unit only, there is little difficulty in saying that it is one establishment. Where, however, the industrial undertaking has parts, branches, departments, units etc. with different locations, near or distant, the question arises what tests should be applied for determining what constitutes one establishment. Several tests were referred to in the course of arguments before us, such as, geographical proximity, unity of ownership, management and control, unity of employment and conditions of service, functional integrality, general unity of purpose etc. To most of these we have referred while summarising the evidence of Mr Dongray and the findings of the Tribunal thereon. It is, perhaps, impossible to lay down any one test as an absolute and invariable test for all cases. The real purpose of these tests is to find out the true relation between the parts, branches, units etc. If in their true relation they constitute one integrated whole, we say that the establishment is one; if on the contrary they do not constitute one integrated whole, each unit is then a separate unit. How the relation between the units will be judged must depend on the facts proved, having regard to the scheme and object of the statute which gives the right of unemployment compensation and also prescribes disqualification therefor. Thus, in one case the unity of ownership, management and control may be the important test; in another case functional integrality or general unity may be the important test; and in still another case, the important test may be the unity of employment. Indeed, in a large number of cases several tests may fall for consideration at the same time. The difficulty of applying these tests arises because of the complexities of modern industrial organisation; many enterprises may have functional integrality between factories which are separately owned; some may be integrated in part with units or factories having the same ownership and in part with factories or plants which are independently owned. In the midst of all these complexities it may be difficult to discover the real thread of unity. In an American decision (Donald L. Nordling v. Ford Motor Company 1) there is an example of an industrial product consisting of 3800 or 4000 parts, about 900 of which came out of one plant; some came from other plants owned by the same Company and still others came from plants independently owned, and a shutdown caused by a strike or other labour dispute at any one of the plants might conceivably cause a closure of the main plant or factory.
Fortunately for us, such complexities do not present themselves in the case under our consideration. We do not say that it is usual in industrial practice to have one establishment consisting of a factory and a mine; but we have to remember the special facts of this case where the adjacent limestone quarry supplies the raw material, almost exclusively, to the factory; the quarry is indeed a feeder of the factory and without limestone from the quarry, the factory cannot function. Ours is a case where all the tests are fulfilled, as shown from the evidence given on behalf of the appellants to which we have earlier referred. There are unity of ownership, unity of management, supervision and control, unity of finance and employment, unity of labour and conditions of service of workmen, functional integrality, general unity of purpose and geographical proximity. We shall presently deal with the legal difficulties at which the Tribunal has hinted and which have been elaborated by learned counsel for the respondent. But apart from them, the only fair conclusion from the facts proved in the case is that the Chaibasa Cement Works consisting of the factory and the limestone quarry form one establishment. The existence of two sets of Standing Orders and a separate attendance register for the limestone quarry have already been adverted to. They have been sufficiently explained by Mr Dongray, particularly the existence of two sets of Standing Orders by reason of the statutory requirement of approval by different authorities  one set by the Labour Commissioner, Bihar, and other by the relevant Central authority."

Ultimately, the Hon'ble Supreme Court of India in the said decision held that if the statute itself says what is one establishment, then there is no difficulty. If the statute does not, however, say what constitutes one establishment, then the usual tests have to be applied to determine the true relation between the parts, branches etc., namely, whether they constitute one integrated whole or not. No particular test can be adopted as an absolute test in all cases of this type and the word 'establishment' is not to be given the sweeping definition of one organisation of which it is capable, but rather is to be construed in the ordinary business or commercial sense.

31(2) In AIR 1963 SC page 1489 (Constitution Bench) - Anakapalle Co-operative Agricultural and Industrial Society vs. Workmen and others, the issue regarding sale of Industrial concern and its effect of services of workmen of the transferor concern vis-a-vis Section 2(oo) and 25FF of the Industrial Disputes Act came up for consideration and it has been held that the claim for compensation by workmen lies against the transferor concern only and not against the transferee concern.

31(3) In 1964 (1) LLJ page 366 - R.S.Madho Ram & Sons (Agencies) (Private) Ltd., and another vs. Its workmen, construction of Section 25FF of the ID Act 1947 came up for consideration and the Hon'ble Supreme Court of India placed reliance upon the Constitution Bench judgment of Anakapalle Co-operative Agricultural and Industrial Society vs. Workmen and others, (AIR 1963 SC 1489) and held that provisions of Section 25FF must be determined in the light of the circumstances of each case and held that the appellants management cannot claim to be a successor in interest of the firm so as to attract the provisions of Section 25FF of the Industrial Disputes Act and the transfer which has been effected by the firm in favour of the appellants does not amount to transfer of the ownership and management of undertaking.

31(4) 1974(1) LLJ page 499 - Workmen of the Straw Board Manufacturing Company Limited vs. M/s. Straw Board Manufacturing Company Limited, the Hon'ble Supreme Court of India has taken into consideration its earlier decisions which determine the tests for determining what is one establishment, and in the light of the principles laid down in the earlier cases viz., Associated Cement Companies Limited v. Their Workmen, [1960 - I L.L.J. 703], Indian Cable Co. Ltd. v. Its Workmen, [1962-I L.L.J 409], pakshiraja studios v. Its Workmen, [1961-II LL.J. 330], Pratap Press v. Their Workmen, [1960-I L.L.J 497], South India Mill Owners' Association and others v. Coimbatore District Textile Workers' Union and others, [1962-I L.L.J 223], and Management of Wenger & Co. v. Their Workmen, (1963) Supp. 2 S.C.R. 863, and considered the issue as to whether the two units of the company are to be regarded functionally as one establishment. It was held that functional integrity will assume an added significance in the case of closure and ultimately held that the concerned Mill was not an independently functioning unit and there is a functional integrity between two mills and the fact of ownership, supervision and control and other common features emphasised do not justify a contrary conclusion.

31(5) In 1996(89) FJR page 728 - Employees' Union and others vs. Industrial Tribunal and others, the issue came up for consideration with regard to the consent of workmen in the case of transfer of undertaking and it has been held as follows:-

" (i) that, after advent of section 25-FF of the Industrial Disputes Act, 1947, there is no scope for invalidating a transfer of the ownership or management of an undertaking whether by agreement or by operation of law, on the ground that consent of the workmen had not been obtained. All that the workmen are entitled to is notice and compensation in accordance with the provisions of section 25-FF of the Industrial Disputes Act if the workman was in continuous service for not less than three years and only if the proviso to section 25-FF was not attracted. No consent of the workers is necessary for validating the transfer of ownership or management of an undertaking within the meaning of section 25-FF of the Industrial Disputes Act;
(ii) that the company, S, as well as the purchaser had given notice to the workmen individually making it clear that all the three conditions of the proviso to section 25-FF of the Industrial Disputes Act were being complied with; the workmen were assured that the same conditions of service would prevail and that even the settlement dated September 18, 1989, would be adhered to. The subsequent correspondence showed that the workmen never questioned the transfer on the ground that consent of the workmen was not taken before effecting the transfer. The relief sought by the workmen in the writ petition against stoppage of work by V was a clear indicator of the fact that the workmen by their positive conduct had consented to the transfer of the undertaking by S to V. In this view of the matter, by their conduct the workmen had tacitly accepted the change in the management;
(iii) that, on the facts, the entire aerated water factory unit with all the employees, and plant and machinery, was sold as a going concern to V. Therefore, the aerated water factory functioning at R was a separate undertaking by itself within the meaning of section 25-FF of the Act. No remand was, therefore, necessary to establish this fact;
(iv) that the document of transfer showed that it was a real and genuine transfer of undertaking. For a period of five months the workers were in fact working under the purchaser, V. There was litigation pending between S and V which also suggested that the transfer of undertaking was true and genuine and could not have been collusive. The Tribunal had also recorded findings to this effect;
(v) that the facts showed that both S and V had given notice to all the workmen which showed that the conditions mentioned in the proviso to section 25-FF had been strictly adhered to. Therefore, the workmen had become employees of V and for any relief with regard to their working conditions had to look to V alone. Section 25-FF had been fully satisfied in the sense that the transferor company had relieved itself of its obligation vis-a-vis the workmen. The entire obligation had passed on the purchaser, V. There was nothing to show that the transfer was illegal or otherwise liable to be set aside. Therefore, the workers were not entitled to any relief against S.
(vi) That the stoppage of work by V was not justified and the workers were entitled to all benefits from V under law, as if there had been no closure."

As per the ratio laid down in the said decision, that after the introduction of Section 25-FF of the Industrial Disputes Act 1947, there is no scope for invalidating the transfer of the ownership or management of an undertaking whether by an agreement or by operation of law on the ground that consent of the workmen had not been obtained and no consent of workers is necessary for validating the transfer of ownership or management of undertaking within the meaning of the said provision.

31(6) In 2005 (1) LLN page 285 (Mad.) (DB) - Management of GE Power Controls Private Ltd., and another vs. Workmen of GE Power Controls Private Ltd. and others, the maintainability of writ petition against a private body pertaining to violation under Industrial Disputes Act came up for consideration and it has been held as follows:-

"The language of Art.226 is no doubt very vide. It states that a writ can be issued "to any person or authority" and "for enforcement of right conferred by Part III and for any other purpose." However, the aforesaid language in Art. 226 cannot be interpreted and understood literally. We cannot apply the literal rule of interpretation while interpreting Art.226. If we take the language of Art.226 literally it will follow that a writ can be issued to any private person or to settle even private disputes. If we interpret the word "for any other purpose" literally it will mean that a writ can be issued for any purpose whatsoever, e.g., for deciding private disputes, for grant of divorce, succession certificate etc. Similarly, if we interpret the words "to any person" literally it will mean that a writ can even be issued to private persons. However, this would not be the correct meaning in view of various decisions of the Supreme Court in which it was held that a writ will lie only against the State or instrumentality of the State vide Chander Mohan Khanna v. National Counsel of Educational Research and Training [1992 (1) LL.N. 16], Tekraj Vasandhi (alias) K.L. Basandhi v. Union of India [1988 (1) L.L.N. 892], General Manager, Kisan Sahkari Chini Mills, Ltd. v. Satrughan Nishad [2003 (4) L.L.N. 1238], Pradeep Kumar Biswas v. Indian Institute of Chemical Biology and others [(2002(5) S.C.C. 111] etc. In General Manager, Kisan Sahkar Chini Mills, Ltd. v. Satrughan Nishad [2003 (4) L.L.N. 1238] (vide supra), the Supreme Court observed that a writ will lie against a private body only when it performed a public function or discharged a public duty. In our opinion the appellants is not performing a public function nor discharging a public duty. It is only doing commercial activity. Hence, no writ lies against it.
The correct interpretation of the aforesaid words in Art.226 is that a writ can ordinarily be issued to a person to whom writs were traditionally issued by British Courts on well-established principles. Similarly, the words, "for any other purpose" have to be interpreted in the narrower sense to mean that a writ can be issued for the purpose for which writs were traditionally issued by British Courts on well-established principles. The British Courts did not ordinarily issue writs to private persons except a writ of habeas corpus."

In the said decision it has been held that when there is an allegation of violation of some provision of the Industrial Disputes Act, the only remedy for the workmen is to raise an industrial dispute under the Industrial Disputes Act, and get the matter referred to the Labour Court or Industrial Tribunal. No writ petition will directly be entertained without first approaching the forums under the Industrial Disputes Act.

31(7) In (2006)9 SCC page 488 - Mettur Beardsell Ltd. vs. Workmen and another, the purpose of Section 25-FF of the Industrial Disputes Act has been restated and the Hon'ble Supreme Court of India has taken into consideration Jawaharlal Nehru University v. Dr.K.S.Jawatkar (1989 supp (1) SCC 679) , Anakapalle Co-operative Agricultural and Industrial Society vs. Workmen and others - (AIR 1963 SC 1489) (Constitution Bench), and also the judgment reported in AIR 1964 SC page 645 - R.S.Madho Ram & Sons (Agencies) v. ITS Workmen and approved the decision reported in AIR 1964 SC 645 - R.S.Madho Ram & Sons (Agencies) v. ITS Workmen, wherein it has been held as follows:-

"Again in R.S. Madhoram and Sons Agencies (P) Ltd. v. Workmen4 the position was highlighted as follows: (SCR pp.383-87) Section 25-FF of the Act provides, inter alia, that where the ownership or management of an undertaking is transferred, whether by agreement or by operation of law, from the employer in relation to that undertaking to a new employer, every workman who satisfies the test prescribed in that section shall be entitled to notice and compensation in accordance with the provisions of Section 25-FF as if the workman had been retrenched. This provision shows that workmen falling under the category contemplated by it, are entitled to claim retrenchment compensation in case the undertaking which they were serving and by which they were employed is transferred. Such a transfer, in law, is regarded as amounting to retrenchment of the said workmen and on that basis Section 25-FF gives the workmen the right to claim compensation.
There is, however, a proviso to this section which excludes its operation in respect of cases falling under the proviso. In substance, the proviso lays down that the provision as to the payment of compensation on transfer will not be applicable where in spite of the transfer, the service of the workmen has not been interrupted. The terms and conditions of service are not less favourable after transfer than they were before such transfer, and the transferee is bound under the terms of the transfer to pay to the workmen in the event of their retrenchment, compensation on the basis that their service had been continuous and had not been interrupted by the transfer. The proviso, therefore, shows that where the transfer does not affect the terms and conditions of the employees, does not interrupt the length of their service and guarantees to them payment of compensation, if retrenchment were made, on the basis of their continuous employment, then Section 25-FF of the Act would not apply and the workmen concerned would not be entitled to claim compensation merely by reason of the transfer. It is common ground that the three conditions prescribed by clauses (a), (b) and (c) of the proviso are satisfied in this case and so, if Section 25-FF were to apply, there can be little doubt that the appellants would be justified in contending that the transfer was valid and the 57 employees can make no grievance of the said transfer. The question, however, is: Does Section 25-FF apply at all?
It would be noticed that the first and foremost condition for the application of Section 25-FF is that the ownership or management of an undertaking is transferred from the employer in relation to that undertaking to a new employer. What the section contemplates is that either the ownership or the management of an undertaking should be transferred; normally this would mean that the ownership or the management of the entire undertaking should be transferred before Section 25-FF comes into operation. If an undertaking conducts one business, it would normally be difficult to imagine that its ownership or management can be partially transferred to invoke the application of Section 25-FF. A business conducted by an industrial undertaking would ordinarily be an integrated business and though it may consist of different branches or departments they would generally be interrelated with each other so as to constitute one whole business. In such a case, Section 25-FF would not apply if a transfer is made in regard to a department or branch of the business run by the undertaking and the workmen would be entitled to contend that such a partial transfer is outside the scope of Section 25-FF of the Act.
It may be that one undertaking may run several industries or businesses which are distinct and separate. In such a case, the transfer of one distinct and separate business may involve the application of Section 25-FF. The fact that one undertaking runs these businesses would not necessarily exclude the application of Section 25-FF solely on the ground that all the businesses or industries run by the said undertaking have not been transferred. It would be clear that in all cases of this character the distinct and separate businesses would normally be run on the basis that they are distinct and separate; employees would be separately employed in respect of all the said businesses and their terms and conditions of service may vary according to the character of the business in question. In such a case it would not be usual to have one muster roll for all the employees and the organisation of employment would indicate clearly the distinctive and separate character of the different businesses. If that be so, then the transfer by the undertaking of one of its businesses may attract the application of Section 25-FF of the Act.
But where the undertaking runs several allied businesses in the same place or places, different considerations would come into play. In the present case, the muster roll showing the list of employees was common in regard to all the departments of business run by the transferor firm. It is not disputed that the terms and conditions of service were the same for all the employees and what is most significant is the fact that the employees could be transferred from one department run by the transferor firm to another department, though the transferor conducted several branches of business which are more or less allied, the services of the employees were not confined to any one business, but were liable to be transferred from one branch to another. In the payment of bonus all the employees were treated as constituting one unit and there was thus both the unity of employment and the identity of the terms and conditions of service. In fact, it is purely a matter of accident that the 57 workmen with whose transfer we are concerned in the present appeal happened to be engaged in retail business which was the subject-matter of the transfer between the firm and the company. These 57 employees had not been appointed solely for the purpose of the retail business but were in charge of the retail business as a mere matter of accident. Under these circumstances, it appears to us to be very difficult to accept Mr Setalvads argument that because the retail business has an identity of its own it should be treated as an independent and distinct business run by the firm and as such, the transfer should be deemed to have constituted the company into a successor-in-interest of the transferor firm for the purpose of Section 25-FF. As in other industrial matters, so on this question too, it would be difficult to lay down any categorical or general proposition. Whether or not the transfer in question attracts the provisions of Sections 25-FF must be determined in the light of the circumstances of each case. It is hardly necessary to emphasise that in dealing with the problem, what industrial adjudication should consider is the matter of substance and not of form. As has been observed by this Court in Anakapalla Coop. Agricultural and Industrial Society v. Workmen5 the question as to whether a transfer has been effected so as to attract Section 25-FF must ultimately depend upon the evaluation of all the relevant factors and it cannot be answered by treating any one of them as of overriding or conclusive significance. Having regard to the facts which are relevant in the present case, we are satisfied that the appellants cannot claim to be a successor-in-interest of the firm so as to attract the provisions of Section 25-FF of the Act. The transfer which has been effected by the firm in favour of the appellants does not, in our opinion, amount to the transfer of the ownership or management of an undertaking and so, the Tribunal was right in holding that Section 25-FF and the proviso to it did not apply to the present case. 31(8) In (2006)10 SCC page 66 - All India ITDC Workers' Union and others vs. ITDC and others, the scope of Judicial review in respect of its disinvestment policy pertaining to ITDC hotels came up for consideration. The Hon'ble Supreme Court of India while deciding the said case has considered the Jawaharlal Nehru University v. Dr.K.S.Jawatkar (1989 supp (1) SCC 679) and distinguished the said case as there was a purported transfer of the employee from the Jawaharlal Nehru University to the Manipur University without his consent and admittedly and the JNU did not exercise any control over the Manipur University and in the case on hand transfer was made from ITDC Ltd. to third respondent company, the shareholding pattern of the two companies was exactly the same and therefore it did not make any difference to the employees, especially, when the scheme of demerger itself provides that the employee will continue in service of the third respondent with full benefits including continuity in service. The Hon'ble Supreme Court of India also considered the BALCO Employees' Union case reported in [(2002) 2 SCC 333] and Southern Structurals Staff Union v. Southern Structurals Ltd reported in (1994)81 Comp. Cases 389 (Mad) and approved the decision of this Court in Southern Structurals Staff Union v. Southern Structurals Ltd reported in (1994)81 Comp. Cases 389 (Mad) (cited supra) and held as follows:-
"The employees have no vested right in the employer company continuing to be a government company or 'other authority' for the purpose of Article 12 of the Constitution of India. ... The status so conferred on the employees does not prevent the Government from disinvesting; nor does it make the consent of the employees a necessary precondition for disinvestment."

31(9) In 2007 (1) L.L.N. page 689 - Ram Pravesh Singh and others vs. State of Bihar and others, the appellants were employees of a co-operative society and whose services have been utilised for better distribution of electricity to Rural areas surrounding Patna. Due to the bad financial position and management of the said society, the State Government took a decision that the assets and liabilities of the society should be transferred to the State Electricity Board but not the services of the employees of the society and despite the request from the Administrator of the society the Board did not absorb them in service. The employees filed writ petitions seeking direction to the State Electricity Board to absorb them in its service ended in dismissal and the appeal was also dismissed and the matter was taken up before the Hon'ble Supreme Court of India and it has been held that since the State Electricity Board neither entered into any contract with the society, nor gave any assurance to the society or its employees to absorb the employees of the society into its service, there is no contractual obligation on the part of the Board to absorb their services. Therefore, the employees had no right to claim any retrenchment compensation under Section 25FF of the Industrial Disputes Act and the did not have any right to claim to be in continuous employment on the same terms and conditions after the purchase of the undertaking by the State Electricity Board.

32. Mr.A.L.Somayaji, learned senior counsel appearing for the 2nd respondent based on the ratio laid down in the above decision, has contended that the submissions made on behalf of the appellants, lack merit and prayed for dismissal of the writ appeal.

33. Mr.Karthik, learned counsel appearing for the third respondent has adopted the arguments of learned senior counsel appearing for the second respondent and prayed for dismissal of the writ appeal.

34. Mr.N.G.R. Prasad, learned counsel appearing for the appellants by way of reply submitted that now the second appellants is aged about 65 years and at this distant point of time, he cannot be directed to avail the alternative remedy. The learned counsel appearing for the appellants also drawn the attention of this Court to the judgment reported in 1995-1 L.L.N. 258 (Mad)  Mettur Chemicals and Industrial Anna Workers Union vs. Chemicals and Plastics India, Ltd. and submitted that the present writ petition is maintainable as the writ of mandamus is a very wide remedy which must be easily available to reach injustice wherever it is found and technicalities should not come in the way of granting relief under Article 226 of the Constitution of India.

35. It is further submitted by the learned counsel appearing for the appellants that since the respondents 2 and 3 were violated the statutory duty cast upon them, the writ petition is maintainable and therefore, prayed for the setting aside of the impugned order passed in the writ petition.

36. We have carefully considered the submissions made by the learned counsel appearing for the appellants and learned counsel appearing for the respondents 2 and 3 and also perused the materials available on record in the form of typed set of documents.

37. The second respondent was appointed on 8.11.1965 as Clerk-cum-Typist in the pay scale of Rs.85-265 in the services of Indian Oxygen Limited. As per the appointment order, the second appellants was liable to be transferred to any of the company branches within India and that the other conditions of service under which the second appellants was appointed are laid down in the Standing Order have also been explained to him as well as the future amendments thereon. The second appellants had subscribed his signature to the staff form.

38. The second appellants joined the Tiruchirappalli branch of Indian Oxygen Limited and thereafter he was confirmed on 1.5.1996. In the year 1995, Indian Oxygen Limited became BOC India Limited  second respondent and the second appellants worked in various offices of the second respondent. On 07.01.1988 the second appellants was promoted as Stenographer Grade I and posted to Health Care Products and he worked in that division and in the year 1995, Health Care division was renamed as Ohmeda Division and the second appellants designation came to be classified as Assistant. On 24.9.1998, the third respondent had purchased the Ohmeda Division from the second respondent and on 30.9.1998, the services of the second appellants had been transferred to the third respondent.

39. The second respondent vide notice dated 30.9.1998 had informed the employees including the second appellants whose services were transferred to the third respondent and the third respondent had agreed to take into its services, the employees without any break or interruption in their services and on the same terms and conditions, including retirement benefits, not in any way less favourable than those applicable to all of them immediately before the transfer date. The concerned employees were advised to continue to report for duty as usual on and with effect from 1.10.1998 as there is no interruption of their services as their services are transferred to the third respondent. The second appellants in his letter dated 7.10.1998 addressed to the second respondent, had drawn the attention of the earlier letters dated 14.3.1998, 6.7.1998 and 20.7.1998 and reiterated that he want to continue his services with the second respondent only for the rest of his services and he do not want to have change over in his employment. It is further stated by him that he has put in more than 30 years of service in the second respondent and therefore, requested them to retain him there.

40. IOL Employees Union in their letter dated 9.10.1998 addressed to the second respondent has cited the order passed by this Court in O.A.No.483 of 1991 in C.S.No.741 of 1991 dated 25.10.1991 and stated that the management had taken unilateral decision to transfer the second appellants without consulting the Union and the second appellants was not permitted to sign in the attendance register from 8.10.1998 and he was informed that his name has been struck off in the attendance register which is patently illegal. Therefore, the Union requested the second respondent to reconsider their decision. The second appellants submitted one more representation dated 16.10.1998 to the second respondent submitting among other things that there was a vacancy for cashier in cash section and he opted to work in that section, but his request was not considered. The second appellants further submitted in that letter that the medical equipment division manufacturing medical products was long back transferred to ESAB India Limited and to the best of his knowledge, no such undertaking by name Ohmeda was established by the second respondent for manufacturing various kinds of medical equipments accessories etc., after second respondents medical equipments division was sold to ESAB India Limited. Hence, the second appellants prayed to the second respondent for reconsideration of the said decision.

41. The second respondent in its reply dated 26.10.1998 addressed to the General Secretary of IOL Employees' Union stated that there is no unilateral decision of transfer of services of the second appellants but on the contrary, by virtue of transfer of undertaking, the second appellants had automatically became employee of the third respondent and hence the order dated 25.10.1991 passed by this Court in O.A.No.483 of 1991 in C.S.No.1991 has been made out of contest and not relevant. Since the second appellants had ceased to be the employee of the second respondent, the question of permitting him to sign the attendance register from 8.10.1998 does not arise. The second respondent citing the said reasons, has objected the request made by the IOL Employees' Union.

42. The second appellants after filing the writ petition in W.P.No.17633 of 1998, has submitted a representation dated 29.4.1999 to the third respondent stating among other things that from 1.10.1998, i.e. the date of transfer, he is without any salary due to the said illegal transfer and he has no means to live due to the compulsion of economic necessity, he was forced to join the services of the third respondent and reporting for duty and the same is without prejudice to his rights in the above said writ petition. The said representation was followed by a lawyer's notice dated 19.5.1999 sent on behalf of the second appellants. The second respondent in response to the representation dated 29.4.1999 submitted by the second appellants and the lawyer's notice sent on his behalf, has stated that since the second appellants did not convey his acceptance, all the posts have been filled up and therefore he has forfeited the right of employment with them. It is further stated in the said letter that the representation of the second appellants came after more than six months and it make it evident that he want to pursue the litigation against the second respondent and also keep his options open for employment with them which is certainly not permissible in law and that the second appellants have to stand or fall by the stand taken by him in the writ petition against the second respondent. Hence, the second respondent. Hence the third respondent has rejected the request of the second appellants.

43. It is to be pointed out at this juncture, the term "Undertaking" is not defined in the Industrial Disputes Act, 1947. The relevant provisions used the term "Industry". "Undertaking" is a concept narrower than Industry. An "Undertaking" may be a part of the whole, that is , the "Industry" and it carries restricted meaning. The activity systematically or habitually undertaken for the production or distribution of goods or for rendering material service to the community at large or a part of such community with the help of employees, is an "Undertaking". In this way, the connection between trade and business on the one hand and the "Undertaking" on the other, is established.

44. The word "Undertaking" as used in Section 25FFF of the Industrial Disputes Act, 1947 seems to have been used its ordinary sense connoting thereby any work, enterprise, project or business "undertaking". It is not intended to cover the entire industry or business of the employer. Even closure or stoppage of a part of the business or activities of the employer would seem in law to be covered by this sub-section. The question has to be decided on the facts of each case. In Associated Cement Companies case reported in [AIR 1960 SC 56] : [1960 - I L.L.J page 703] (cited supra) , it has been held that to find whether the establishment is an undertaking, it was not possible to lay down any one test as an absolute and invariable test for all cases. A decision was placed in proper ground that functions regarding of financial integrity, general unity and geographical proximity are to be taken into consideration in determining the ultimate question as to whether the factory, plant or unit or their industry is a separate unit within the meaning of employment no trade test can be adopted as an absolute test in all cases of this type and the word 'establishment' is not to be given the sweeping definition of one organisation of which it is capable, but rather is to be construed in the ordinary business or commercial sense.

45. In Spencer Group Aerated Water Factory Employees' Union and others v. Industrial Tribunal and others reported in [1996(89) Factories Journal Reports 728], it has been held that no consent of workers is necessary for validating the transfer of ownership or management of an undertaking within the meaning of Section 25FF of the Industrial Disputes Act and in the said case, the company as well as the purchaser given notice to the workmen individually making it clear that all the three conditions of the proviso to Section 25FF of the Industrial Disputes Act were being complied with and the workmen were assured that the same conditions of service would prevail and that even the settlement dated 18.9.1989 would be adhered to.

46. The Hon'ble Supreme Court of India, in Mettur Beardsell Ltd., vs. Workmen and another reported in 2006(9) SCC 488 (cited supra), held that letter of consent of the individual employee cannot be a ground to invalidate the action of transfer of industrial "Undertaking" and the employees who have been transferred were given the benefit in altered terms and conditions of work covering salary, wages retrenchment etc. At this juncture, it is useful to consider Clause 10(1) of the agreement of transfer dated 24.9.1998 which is as follows:-

"The purchaser shall take into service on and from the day immediately following the completion Date, all the employees who have accepted employment with the Purchaser as listed in Sch. 2. Such employees shall be transferred to the purchaser without any break or interruption in service and upon terms and conditions of employment (including retirement benefits) not in any way less favourable than the terms and conditions of employment applicable to them immediately prior to the completion date. The Seller confirms and the Purchaser acknowledges that the Seller has provided the Purchaser with a complete list of employee benefit plans that are applicable to the Employees and which include benefits relating to pension, provident fund and gratuity".

47. A careful reading of the said clause would reveal that the purchaser shall taken into services of the employees who have accepted employment that the purchaser as listed in Schedule 2 and such employer shall be transferred to the purchaser without any break or interruption in service and upon terms and conditions of employment including the retirement benefits not in any way less favourable than the terms and conditions of employment applicable to them immediately prior to the completion date.

48. In the counter affidavit filed by the second respondent in the writ petition, it has been stated that by virtue of transfer of undertaking, the second respondent issued a notice dated 30.9.1999 informing the employees about the transfer of entire undertaking of Ohmeda Health Care division to the third respondent with effect from 1.10.1998 and the third respondent has agreed to take into their services, the employees whose names are mentioned in the list without any break or interruption in their service on the same terms and conditions which are less favourable all of them immediately before such transfer.

49. The counter affidavit filed by the third respondent in W.M.P.No.16863 of 1999 in W.P.No.17633 of 1999 states that in pursuant to the agreement dated 24.9.1998, the second respondent agreed to sell the business of Health Care Division as a going concern in favour of the third respondent with effect from 1.10.1998 and the third respondent, took into its service, the employees who accepts the employment in the second respondent as listed in Schedule II of the agreement. A plain reading of Clause No.10(1) of the agreement dated 24.9.1998 and the averments made in the counter affidavit filed by the second and third respondents would show that the second appellants has not accepted the employment that the purchaser viz., the third respondent and at the later point of time, submitted a representation dated 29.4.1999 and lawyer's notice dated 19.5.1999 expressing his willingness to join the services of the third respondent without prejudice to his right in W.P.No.17633 of 1998. However, the third respondent has rejected the said request vide its letter dated 8.6.1999 on the ground of failure to accept his acceptance of employment with them.

50. This Court vide order dated 1.10.1999, in W.M.P.No.26694 of 1998 in W.M.P.No.1683 of 1998 and W.P.No.17633 of 1998 had directed the second respondent to pay a sum of Rs.6400/- every month as compensation from 1.10.1999 till the disposal of the writ petition and such payment could be set off or for justified in the event of the petitioner failing in the writ petition and as against the compensation or other terminal benefits that may be payable to the second appellants ultimately. It was also represented before this Court that the said order was challenged by way of appeal in W.A.No.2314 of 1999 by the second respondent, but it was dismissed on 21.1.2000 and the interim order has been complied with after admission of this writ appeal, by way of interim measure, this Court directed the second respondent to pay a sum of Rs.50,000/- vide order dated 23.3.2003 and it has also been complied with.

51. The second respondent in his counter affidavit filed in the writ petition, has specifically averred that the Health Care Division is an independent division and there is no functional integrity involved. The primary function of the second respondent is to manufacture medical and industrial gas and whereas the function of the Health Care Division was purchase and sale of medical equipments and employees like the second appellants have been working exclusively for the said division.

52. However, till the formation of Health Care Division by the second respondent, in the year 1995, the second appellants continued to work with the second respondent and on 19.12.1996 he has been posted as Assistant in Health Care Division. On 24.9.1998, the third respondent purchased Health Care Division from the second respondent subject to the terms of the agreement dated 24.9.1998 and Clause 10(1) of the said agreement has already been referred to above. The second respondent has not taken a clear stand whether the services of the second appellants with the Health Care Division was interchangeable and whether a common seniority was maintained etc. Though there cannot be any functional integrity between the Health Care Division and the functions of the second respondent, the fact remains the second appellants was originally in the services of the second respondent and in the year 1995, he was transferred to Health Care Division as an Assistant.

53. The Hon'ble Supreme Court of India in the judgment reported in 2008(1)- L.L.N. - BCPP Mazdoor Sangh and another v. N.T.P.C. and others, held that the employees recruited by NTPC whose services were transferred are neither party to tripartite agreement nor they have been heard before they have been changed condition and hence the action of the management in violation of Article 14 of Constitution of India. In the case on hand, Clause 10(1) of the agreement dated 24.9.1998 entered into between the second and third respondent specifically stipulates that the employees whose services are sought to be transferred to the third respondent are accepted the employment. As already stated above, the counter affidavits of second and third respondents have not revealed anything about the acceptance of such employment by the second appellants. Moreover, there is no tripartite agreement entered into between the transferred employees or their union with the second and third respondent so as to bind them. It is a specific case of the second appellants that in paragraph No.18, of his affidavit filed in support of his writ petition that the management of the second respondent provides for pension, higher rates of bonus and also payment of Rs.160/- per month towards health and hygiene and prosperity share amount and also the canteen facility. The second respondent in paragraph No.21 of the counter affidavit, has generally denied the said statement. The third respondent in its counter affidavit in W.M.P.No.1683 of 1998 in W.P.No.17633 of 1998 has stated that when transfer of undertaking takes place, such transfer provides for continued employment of the workmen of the transferor in the services of the transferee on the same terms and conditions and without disruption.

54. Even though the above said facts are loaded in favour of the second appellants, we are not in a position to grant the relief in his favour, in view of the judgment reported in (2006)9 SCC page 488 - Mettur Beardsell Ltd. vs. Workmen and another, wherein it has been held that in case of transfer of industrial undertaking, consent of individual employee is not a pre-requisite and non-obtaining of consent cannot be a ground to invalidate the action. The Hon'ble Supreme Court while deciding the said case has approved the decision reported in R.S.Madho Ram & Sons (Agencies) v. ITS Workmen - AIR 1964 SC page 645 - R.S.Madho Ram = (1964)5 SCR 379 (cited supra). The issue regarding one undertaking running several industries or businesses which are distinct and separate also considered and held that one undertaking runs these businesses would not necessarily exclude the application of Section 25-FF solely on the ground that all the businesses or industries run by the said undertaking have not been transferred.

55. In the case on hand, that one of the businesses run by the second respondent has been transferred in favour of the third respondent subject to the fulfilment of clause 10.1 of the agreement dated 24.9.1998. Even though it has not been clearly established by the second respondent that the consent of the second appellants has been obtained before transferring his services to the third respondent, the fact remains, the non compliance of the said clause would not enable him to invoke the jurisdiction of this Court under Article 226 of the Constitution of India. The plea raised by the second appellants that he will lose certain benefits enjoyed by him while he was in the service of the second respondent requires adjudication since it is a disputed fact which cannot be adjudicated in this proceeding.

56. The judgment reported in 2008(1) L.L.N. page 1 - BCPP Mazdoor Sangh and another v. N.T.P.C. and others, in our considered opinion is not applicable to the facts of the present case as the employees of the public sector undertaking viz., NTPC have been transferred to a private company by virtue of disinvestment policy of the Central Government and it was challenged by filing a writ petition. The Hon'ble Supreme Court of India, in the said decision held that no employee could be transferred without his consent from one employer to another and the appellants having been selected and appointed by NTPC, their services could be continued with that corporation only and their transfer to a private company without their consent is bad in law and it also violates Section 23 of the Indian Contract Act and Article 14 of the Indian Contract Act. In the case on hand, it is a transfer of service of an employee from one private organisation to another private organisation. Even though the consent of the second appellants has not been obtained under clause 10.1 of the agreement dated 24.9.1998 entered into between the second and third respondents, and that it is in violation of Section 23 of the Indian Contract Act, to challenge the vires of the said action, writ petition cannot be maintained. It is trite law that that a writ is maintainable against a private body, only it performs a public function or discharging public duty. However, the facts of the present case would lead to an inevitable conclusion that neither the second respondent nor the third respondent is performing any public duty and they are doing only commercial activity. Hence, the writ petition against the second respondent herein to continue the second appellants in its service in the same manner as before 1.10.1998 is not maintainable.

57. Section 25FF of the Industrial Disputes Act and proviso to said section cannot be held to be unconstitutional as it sufficiently protects the interest of the workmen. As per Section 25FF, in the event of retrenchment of workman who has been in continuous service for not less than one year in the undertaking immediately before such transfer, shall be entitled to notice and compensation.

58. The proviso would come into operation if the terms and conditions of workman after such transfer are not in any way less favourable to workman than those applicable to him immediately before the transfer. A reading of clause 10.1 of the agreement dated 24.9.1998 would reveal that the third respondent has agreed to provide the same benefits as provided by the second respondent and the second appellants has not chosen to exercise his option at the earliest point of time. The option exercised by him at the later point of time was rejected by the third respondent on the ground of delay and the pendency of W.P.No.17633 of 1998.

59. We have also considered the decision of a Division Bench of this Court reported in Spencer Group Aerated Water Factory Employees' Union and others v. Industrial Tribunal and others reported in [1996(vol.89) Factories Journal Reports page 728] (cited supra), and we are in full agreement with the ratio laid down in the said decision.

60. In view of the above said reasons, we find no infirmity or error apparent on the face of the record in the impugned order dismissing the writ petition.

61. In the result, the writ appeal is dismissed, confirming the orders passed in the writ petition. But in the circumstances, there will be no order as to costs.

62. However, this Court is alive to the fact that the second appellants is now aged about 65 years old and though he belatedly exercised his option to join the services of the third respondent, it was rejected. The second respondent may sympathetically consider the same and arrive at a reasonable settlement with the second appellants and grant him some monetary relief.

(D.M.J) (M.S.N.J) 12.01.2009.

Index:Yes/No Internet:Yes/No gr.

To

1. The Secretary, Ministry of Labour, Shram Shakti Bhavan, New Delhi.

2. The Operations Manager, B.O.C. India Ltd., 75, Vaidyanathan Street, Tondiarpet, Chennai - 600 001.

3. The Zonal Manager, Datex Ohmeda India (P) Ltd., 75, Vaidyanathan Street, Tondiarpet, Chennai - 600 001.

Note:- Issue order copy on 21.1.2009 D.MURUGESAN, J and M.SATHYANARAYANAN,J gr. 

						  	PRE DELIVERY JUDGMENT IN 								W.A.No.286 OF 2003







									12.01.2009