ARIJIT PASAYAT, J.-

Leave granted in SLPs (C) Nos. 22724 of 2004 and 5071 of 2005.

2. These appeals have a common matrix. By the impugned judgment rendered by a Division Bench of the Madras High Court three appeals were disposed of. Writ Appeal No. 761 of 1992 was against order dated 22-7-1991 passed in Writ Petition No. 11956 of 1987 passed by a learned Single Judge. while Writ Appeal No. 760 of 1997 was against the order dated 24-2-1997 in Writ Petition No. 1063 of 1988 passed by a learned Single Judge. The third appeal before the Division Bench was Contempt Appeal No. 13 of 1992 directed against order dated 11-12-1992 in Contempt Application No. 336 of 1992 passed by a learned Single Judge.

3. Factual background as highlighted by the appellant Management of Mettur Beardsell Ltd. is as follows:

Mettur Beardsell Ltd. started business in 1936 and conducted operations successfully till 1970, when it faced financial problems. On 19-5-1977 a resolution was passed to hive off its textile operation by entrusting it to its wholly-owned subsidiary which was to be formed. In fact on 19-12-1981, Mettur Textile Pvt. Ltd. was formed. On 21-6-1982 at the annual general meeting of Mettur Beardsell Ltd. shareholders authorised entering into of an arrangement on behalf of Mettur Beardsell Ltd. and Mettur Textile Pvt. Ltd. For the sake of convenience they are described as Beardsell and Textile herein after.

a 4. The workers were informed about the transfer. On 9-2-1982 information about Integrated Textile Division consisting of manufacturing and marketing divisions of the textile division in all locations including Madras with necessary support staff was given. On 22-9-1982 notice to workers was given that EDP Department will also be treated as a part of the Integrated Textile Division. The EDP Department was to continue to operate b from 49. Rajaji Road where the Integrated Division was situated. The office of Beardsell was on 47. Bose Road which is a different address. On 29-11-1982 individual letters/notices were sent to employees, who have been in the textile division, that they were being treated as part of the Integrated Textile Division with unaltered terms and conditions of work. On 30-11-1982 circular was sent to the employees that employees' allocation has been c completed and Beardsell was to become a partner of newly formed subsidiary "Textile" to ensure that textile division could be treated separately.

On 14-12-1982 a partnership firm called "Mettur Textiles" was formed between Textile and Beardsell evidenced by a partnership deed. On 3-3-1983 an agreement was entered into amongst Beardsell, Textile and one Rukmini Investments Pvt. Ltd. (in short "Rukmini"). Beardsell was paid :I Rs 1,74,00,000 by Rukmini Investments for divesting all rights and assets in the Integrated Textile Division. Later Rukmini took over entire partnership business and incorporated it as Mettur Textile Industries Ltd. On 25-1-1983 employees of the Integrated Division were informed individually about the arrangement and their absorption with effect from 1-1-1983 without change in the conditions of service. On 31-1-1983 employees were informed that their services would be absorbed by Textile and that terms and conditions which would be uninterrupted would cover salary, wages, benefits, retrenchment and retirement. On 24-3-1983 notices were sent to the workmen informing them that Beardsell had retired from partnership and that the terms and conditions of work would not be in any way less favourable' than the prevailing situation. On 13-5-1983 letters were written by the respondent Employees' Association to Beardsell admitting the transfer to Mettur Textile and requested for an option for retention/retransfer to the rolls of Beardsell. Their claim was that there ought to have been a memorandum' of settlement under Section 12(3) of the Industrial Disputes Act, 1947 (in short "the Act"). On 17-6-1983 the respondent workmen through their Association wrote a letter to