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Mr. S.K. Bagaria, learned senior counsel appearing for the Baranagore Jute Factory PLC Shramik Sabha, submitted that the Scheme was sanctioned and approved by the High Court and by this Court primarily taking into consideration the workers' interests and that the workers and their Unions supported the Scheme and the Scheme provided for payment of pre-scheme outstanding dues and current dues of the workers. According to him, Nemani Committee defaulted in making payment of wages, provident fund, ESI, gratuity etc. not only towards the outstanding pre-scheme arrears but also the current dues during its period of management. In addition to the defaults committed by Nemani Committee in payment of the said outstanding pre- scheme dues, the said Committee also defaulted in paying the workers; current dues during its period of management. It was further submitted that all other pre-scheme unsecured creditors who lodged their claims with the Registrar of the High Court, have already received their payments and as against the aforesaid, the workers have hardly received a small fraction of their outstanding dues for the pre-scheme period and over and above that, their huge dues got mounted for the current periods during which Nemani Committee was in management. The Scheme being primarily for the benefits of the workers and unsecured creditors and all other unsecured creditors excepting the appellants having already been paid, it is in the interest of justice and in terms of the Scheme that the amounts accumulated under the Scheme be directed to be utilized for paying the workers' dues and statutory liabilities on account of Provident Fund, ESI, wages, bonus, gratuity, STL etc. He invited out attention to Section 11(2) of the Employees' Provident Funds and Miscellaneous Provisions Act, 1952 which provides that the amounts due from an employer shall be deemed to be the first charge on the assets of the establishment and shall be paid in priority to all other debts. It was submitted that the workers and their Unions supported the scheme in expectation and hope that their outstanding dues as well as current dues would be paid by Nemani Committee as specifically provided in the Scheme. Similar was the position when the Jain-Jalan Committee was in management. However, when they came to know about filing of applications by Sri Raj Kumar Nemani and by Sri Radheyshyam Ajitsaria and their group concerns before the learned single Judge of the High Court for payment of their dues out of the funds accumulated under the Scheme, the Unions moved two separate applications bearing C.A.No.9 of 1999 and C.A.No.10 of 1999 before the learned single Judge praying, inter alia, for not directing any such payment without first paying to the workers. Arguing further, the learned senior counsel, submitted that all unsecured creditors excepting the appellants have already been paid. In the aforesaid circumstances and in terms of the Scheme, the amounts lying with the Registrar of the High Court are required to be utilized for paying the workers' dues. According to him, the Division Bench of the High Court correctly held that the release of any amounts to the Members of the Nemani Group at this stage is not appropriate. However, the Division Bench of the High Court erred in not directing for payment of the workers' dues out of the amounts accumulated under the Scheme and lying with the Registrar as has been contended by Shramik Sabha in the appeal filed by it (C.A.No.5907/2004).

It was further submitted that as stated in C.A.No.5907 of 2004 filed by Shramik Sabha, the Division Bench should have directed for utilizing the balance amount lying with the Registrar, Original side, High Court of Calcutta for payment of workers' dues and statutory liabilities on account of the Provident Fund, ESI, wages, Gratuity, bonus etc. It was further submitted that a period of 18 years has passed since approval of the Scheme by this Court on 30.11.1988 and it will be fully in terms of the Scheme as well as Section 11(2) of the Employees' Provident Fund and Miscellaneous Provisions Act, 1952, if the funds lying with the Registrar are utilized for payment of the workers' dues including those on account of outstanding Provident Fund dues mentioned above.

Insofar as the outstanding amounts are concerned, these very unions had sworn affidavits filed in July, 1993 before the High Court stating that the Nemani group after taking over management has paid substantial part of their dues. Insofar as the scheme is concerned, the said scheme was initially for a period of 8 years and the amounts mentioned therein were to be liquidated over the years and not immediately upon the scheme coming into force. The payments which were to be made immediately upon implementation of the scheme, were accordingly made. The petitioner group was replaced midway into the scheme and did not complete the entire tenure of the scheme. The new Committee of Management (Jain-Jalan) which replaced the petitioner group, took over the management on the same terms and conditions as contained in the scheme, thereby assuming and/or taking over the entire responsibility of payment of all outstanding amounts including workers dues and other employee benefits including Provident Fund. It is pertinent to note that the fund which is the subject- matter of the present proceedings was created only for the purpose of payment of unsecured creditors under the scheme framed by the High Court and accepted and affirmed by this Court by two orders dated 17.12.1993 and 11.03.1994. This Court affirmed that the amount of Rs. 8 lacs per month out of the revenues of the Company would be kept aside in the hands of the Registrar, Original side and pay to the unsecured creditors alone @ 2% per month. Admittedly, the said corpus has been treated by successive orders of this Court and the High Court as being the dues of the unsecured creditors alone. None of these orders were ever appealed against or set aside. It is too late in the day to contend that the said fund would also be utilized for payment of workers dues and or other statutory dues for which the scheme made separate arrangements. Both Jardine Henderson and Jain- Jalan Committee who were in management of this Company at various points of time have been allowed to recover their entire dues as unsecured creditors out of this fund without reference to the workers dues and or other statutory dues. At no stage, whatsoever, have any part of the said fund been utilized by the High Court for payment of any of the workers dues or other dues. The said fund, in our opinion, therefore, cannot have a different character merely when it comes to the dues of the present petitioners.

It is important to note that by orders of Court, the company (in liquidation) was not in fact wound up but was allowed to continue as a going concern. This was undoubtedly in the interest of the workers. So long as the company continued as a going concern, the workers not only continued to get their wages and other benefits and also retained their rights to be reimbursed out of the assets of the Company in the event that the assets have to be sold in winding up. In fact, the fixed assets of the Company are enormously valuable. It has land in excess of 50 acres in prime locations out of which 17 acres was acquired by the National High-way Authority upon payment of compensation of Rs. 41 crores recently to the present Company. The dues of workers are, therefore, in no jeopardy whatsoever. When the Company continues as a going concern, it is the dues of the unsecured creditors which are most vulnerable and it is for that purpose this Court by its various orders ensured that a separate fund should be created for the unsecured creditors. In our opinion, it is fair and proper that the funds so created should only be utilized for the purpose of the unsecured creditors and not workers dues and other dues.