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2007 DIGILAW 196 (GUJ)

RUSHABH PRECISION BEARINGS LTD. v. MILL MAZDOOR SABHA

2007-03-23

R.M.DOSHIT

body2007
R. M. DOSHIT, J. ( 1 ) THIS is a writ petition preferred under Articles 226 and 227 of the Constitution of India by Messrs. Rushabh Precision bearings Limited [hereinafter referred to as, "the Company"]; a Company incorporated under the Companies Act and an industry within the meaning of Section 2[j] of the industrial Disputes Act, 1947, against the judgment and award dated 30th August, 2002 passed by the Industrial Tribunal, Rajkot in reference [it] No. 46 of 2002, and the Order dated 15th March, 2003 passed by the labour Court, Surendranagar in Recovery application No. 146 of 2002 and the consequent Recovery Certificate dated 7th april, 2003 issued by the Labour Court, surendranagar in the sum of Rs. 4,93,26,260/ ( 2 ) THE respondent no. 1-Mill Mazdoor sabha [hereinafter referred to as, "the union"] is a Labour Union representing the 323 workmen employed by the Company and two other industries viz. , M/s. SRS Bearing industries and M/s. SRS Engineering industries. ( 3 ) MR. Nanavati has submitted that the impugned judgment and award passed by the Industrial Tribunal, Rajkot is nullity in as much as the Tribunal has answered the matters which were not referred to the tribunal against the industries which were not party before the Tribunal. He has submitted that there were certain disputes between the Company and its workmen. According to the Company, the workmen had illegally struck off the work. According to the workmen, the Company had illegally locked out. An industrial dispute was raised in that regard and the reference came to be made to the Industrial Tribunal, Rajkot. The reference was whether the closure declared by the Company was legal and whether the workmen were entitled to wages till they were reinstated in service. The workmen who were party to the Reference were not only the employees of the Company but were also the employees of one M/s. SRS Bearing industries and SRS Engineering Industries [hereinafter cumulatively referred to as, "the firms"]. The Reference was contested by the company. The Company raised a specific defense that the Company and the firms were separate and distinct legal entities. The company cannot have any liability in respect of the workmen employed by the firms - one a proprietory firm and another a body corporate. Nevertheless, the Reference came to be decided against the Company. The Reference was contested by the company. The Company raised a specific defense that the Company and the firms were separate and distinct legal entities. The company cannot have any liability in respect of the workmen employed by the firms - one a proprietory firm and another a body corporate. Nevertheless, the Reference came to be decided against the Company. The learned Tribunal specifically held that the company was the main industry and Messrs. SRS Bearing Industries and Messrs. SRS engineering Industries were part of the company. All the three a the Company and the firms had singular existence. The closure declared by the Company was in contravention of Section 25 [o] of the industrial Disputes Act, 1947 [hereinafter referred to as, "the Act"] and was illegal. Consequently, the Tribunal directed the company to reinstate all the workmen in service and to pay backwages. It appears that the impugned order was not challenged by the Company. Consequently, the impugned recovery Certificate dated 15th March, 2003 came to be issued on the recovery application made in respect of 323 workmen of the Company and the firms. ( 4 ) MR. Nanavati has submitted that indisputably the firms were not party in the conciliation proceeding before the conciliation Officer, nor was the reference made against them, nor were they party to the Reference. He has further submitted that admittedly the 323 workmen, in respect of whom the Award is made against the company, were not the employees of the company. Many of them were admittedly the employees of the firms. The Company could not have been issued direction to reinstate the workmen of the firms and to pay them backwages. He has also submitted that in absence of a specific reference, the learned tribunal has erred in holding that the company and the firms had a singular existence and that the Company was liable to the workmen of the Company as well as the workmen of the firms. In support of his arguments, Mr. Nanavati has relied upon the judgment of this Court in the matter of navin FLUORINE INDUSTRIES V/s. B. M shah [2003 (3) GLH 189]. ( 5 ) THE petition is contested by Mr. Mishra. Mr. Mishra has submitted that the impugned award was passed as far back as in the year 2002 since then, there were several proceedings taken out pursuant to the impugned award. ( 5 ) THE petition is contested by Mr. Mishra. Mr. Mishra has submitted that the impugned award was passed as far back as in the year 2002 since then, there were several proceedings taken out pursuant to the impugned award. Nevertheless, at no point of time, the petitioner challenged the said award. The challenge to the impugned award in the present petition after an inordinate and unexplained delay of more than three years is not sustainable. He has further submitted that since the impugned award, several proceedings were taken out by the respondent-Union. In the said proceedings, several orders have been made in favour of the workmen. If the present petition is entertained at this juncture, ail such orders made in favour of the workmen shall stand set at naught. He has also submitted that the workmen have taken out above Civil Application for seeking benefit under Section 17-B of the Act. The workmen are entitled to such benefit. If the present petition is now decided, the said application shall become infructuous and the workmen will be deprived of the statutory benefit under Section 17-B of the Act. He has also produced charter of demand made by the union. He has submitted that the Union had raised charter of demand against all the three industries namely the petitioner-Company and the firms. Nevertheless, the appropriate Government had, while making reference, made reference against the company alone. This error has been committed by the appropriate Government and not by the workmen or the Union. In support of his contentions, Mr. Mishra has relied upon the judgments in the matters of messrs. NATIONAL IRON and STEEL company LIMITED and OTHERS.V/s. THE state OF WEST BENGAL and ANR. , [1967 sc 1206]; OF MESSRS. RUP DIAMONDS and ors. V/s. UNION OF INDIA and ORS. [ (1989)2 SCC 356 ]; OF STATE OF MP and ORS. NANDLAL JAISWAL and ORS. [ (1986) 4 SCC 566 ]; OF WORKMEN OF HINDUSTAN vegetable OILS CORPORATION limited and HINDUSTAN VEGETABLE oils CORPORATION LIMITED and ORS. [ (2000) II LLJ 792]; OF CM SARAIAH V/s. EE PANCHAYAT RAJ DEPARTMENT and anr. , [ (2000) LLJ-I P-23]; OF DENA BANK v/s. KIRITKUMAR T. PATEL [ air 1998 SC 511 ]. NANDLAL JAISWAL and ORS. [ (1986) 4 SCC 566 ]; OF WORKMEN OF HINDUSTAN vegetable OILS CORPORATION limited and HINDUSTAN VEGETABLE oils CORPORATION LIMITED and ORS. [ (2000) II LLJ 792]; OF CM SARAIAH V/s. EE PANCHAYAT RAJ DEPARTMENT and anr. , [ (2000) LLJ-I P-23]; OF DENA BANK v/s. KIRITKUMAR T. PATEL [ air 1998 SC 511 ]. He has also relied upon the judgment of this Court in the matter of KANJIBHAI punjabhai PARMER V/s. STATE OF gujarat [ 2005 (1) GLH 208 ] AND OF THE kerala HIGH COURT IN THE MATTER of COMMANDANT, DEFENCE SECURITY corps CENTRE, CANNANORE V/s. SECRETARY, NCC GROUP URC employees ASSOCIATION, CALICUT [2001 LAB. I. C 2002]. ( 6 ) THE above referred charter of demands dated 17th January, 2001 made by the Union was addressed to the Managing director, Rushabh Precision Bearings limited i. e, the petitioner-Company. The said demand does refer to the firms viz. , m/s. SRS Bearing Industries and SRS engineering Industries. On behalf of around 350 workmen employed by the said three industries, a demand was made against the petitioner Company alone. The said demand notice was not addressed to either M/s. SRS bearing Industries or to SRS Engineering industries. It is evident that the appropriate government made reference in respect of all the 350 workmen against the Company alone i. e, the appropriate Government proceeded on the premise that the Company and the firms had functional integrity and all the 350 workmen had a claim against the Company. The Reference proceeded against the company alone. Though no specific reference was made and though the firms were not party before the Tribunal, the Tribunal has recorded specific finding that all the three industries had a functional integrity and that all the 350 workmen, though admittedly were not the employees of the Company, had a claim against the Company. The approach of the Tribunal below is manifestly wrong. I am of the opinion that in absence of a specific reference - Whether or not the three industries had a functional integrity and whether the employees of the firms had a claim against the petitioner-Company and in absence of the firms before it, the Tribunal could not have recorded the objectionable finding. The Tribunal has indeed exceeded its jurisdiction. ( 7 ) I do agree with Mr. The Tribunal has indeed exceeded its jurisdiction. ( 7 ) I do agree with Mr. Mishra that the hearing of the application made for extending benefit under Section 17-B of the act should be heard at the earliest and should not be postponed until hearing and decision on the main matter. However, I do not agree that the main matter ought not to be heard and decided at this stage so as to allow the workmen to avail of the benefit extended under Section 17-B of the Act. That is not the tenor of the judgment of the hon ble Court in the matter of Workmen of hindustan Vegetable Oils Corporation limited [supra]. It is indeed true that the company has challenged the impugned award in the present petition after a considerable delay. In the meantime, the company allowed the workmen to take out several legal proceedings and the Courts to make orders from time to time. However, the said delay has been explained. According to the Company, the company was facing financial crisis, it was declared sick unit and was before the BIFR for rehabilitation. In the meantime, the workmen pursued the matter further, applied for execution of the award and obtained the impugned recovery certificate. The workmen also approached this Court seeking execution of the recovery certificate. The workmen also challenged the attempt of the Company to dispose of its plant and machinery. Several orders came to be made from time to time in favour of the workmen which culminated in deposit of Rs. 20 lakhs by the Company in the registry of this Court. I am informed that the said sum of Rs. 20 lakhs has been invested by the registry. But, in my opinion, the delay or the orders made in the other proceedings should not allow an illegal order to be sustained. As observed hereinabove, the Tribunal below exceeded its jurisdiction in holding that the Company and the firms had functional integrity and had singular existence and that the Company was liable not only to its own employees or the workmen but also to the workmen employed by the firms. The said findings recorded by the Tribunal are unwarranted and cannot be sustained. Inspite of repeated objection raised by the Company, the Union and the Tribunal below allowed the Reference to be proceeded against the Company without seeking reference against the firms. The said findings recorded by the Tribunal are unwarranted and cannot be sustained. Inspite of repeated objection raised by the Company, the Union and the Tribunal below allowed the Reference to be proceeded against the Company without seeking reference against the firms. ( 8 ) IN above view of the matter, the petition is allowed. The impugned judgment and award dated 30th August, 2002 passed by the Industrial Tribunal, Rajkot in reference [it] No. 46 of 2002 is quashed and set-aside. The Reference is remanded to the tribunal below for hearing and decision afresh in respect of the workmen of the petitioner-Rushabh Precision Bearings limited. It is clarified that both the parties shall be at liberty to approach the appropriate Government to suitably modify the reference made to the Tribunal. It is further clarified that the workmen of the aforesaid SRS Bearing Industries and SRS engineering Industries shall be at liberty to raise industrial dispute against the respective industry. If such a dispute is raised, the appropriate Government shall consider and process the same in accordance with law. It is further directed that the sum of Rs. 20 lakhs deposited in this Court and invested by the registry shall continue to be invested until the Reference is heard and decided afresh by the Tribunal, and shall be subject to the decision of the Tribunal. The registry shall transfer the said sum of Rs. 20 lakhs to the Tribunal below. It is further directed that the petitioner-Company shall pay a cost of Rs. 1000/= to each workman employed by it i. e. , the employees of the petitioner-Rushabh Precision Bearings Limited within four weeks from today. ( 9 ) SUBJECT to the above direction, rule is made absolute. In view of this order, challenge to the impugned order dated 15th march, 2003 and the recovery certificate dated 7th April, 2003 shall not survive. The parties shall bear their own cost. ( 10 ) CIVIL Application stands disposed of.