IMPORTANT POINT
Reference u/s 10, ID Act must be appropriately worded giving true picture of the dispute.

Headnote:(a) Industrial Disputes Act, 1947 - Section 2(k) - Industrial Dispute - TISCO hiving off its cement business to Lafarge along with employees - Employees dissatisfied with working conditions at Lafarge seeking repatriation claiming to continue to be employees of TISCO - TISCO denying the same as transfer of service was effected with employees' consent - This itself is an industrial dispute - Reference u/s 10 not incompetent. (Para 11)
        (b) Industrial Disputes Act, 1947 - Section 10 - Terms of reference not appropriately worded - Dispute is whether the employees continue to be employees of TISCO - But the reference pre-supposes that they are employees of TISCO - Reference is defective - It does not raise the real dispute and limits the scope of adjudication - It also precludes appellant from putting up its case - Cannot be sustained. (Paras 12 and 20)
        (2002) 10 SCC 708; (2000) 1 SCC 371 - Relied upon
        1982 (LAB) IC 1309 - Cited with approval
       Facts of the case:
        TISCO Ltd. sold its cement business to Lafarge with the condition that its employees will be taken over retaining the terms and conditions of service.
        However the employees were not given the benefits enjoyed by them and hence they approached the Labour Commissioner with a prayer that TISCO should take them back.
        TISCO denied their responsibility stating that appointment letters were issued by Lafarge to the employees and they were no longer its employees.
       Finding of the Court:
        Terms of reference is not appropriately worded and is defective.
       Result : Appeal allowed. Reference quashed.

JUDGMENT

A.K. SIKRI, J.

1. Leave granted.

2. We heard the Counsel for the parties at length. Having regard to the nature of issue involved that needs to be answered by us, it would be enough to to take note of some admitted facts, eschewing detailed factual discussion which may unnecessarily burden this judgment.

3. The appellant before us is M/s. Tata Iron & Steel Company Limited (rechristened as Tata Steel Ltd.). Apart from manufacturing steel, its core business, the appellant company was having cement division as well. In the era of globalization, liberalization and also because of economic compulsions, the appellant decided to follow the policy of disinvestment. Persuaded by these considerations it sold its cement division to Lafarge India Pvt. Ltd (hereinafter to be referred as ‘M/s. Lafarge’) vide Business Transfer Agreement (BTA) dated 9.3.1999 which was to be effected from 1.11.1999. This agreement, inter alia provided that M/s. Lafarge would take over the company personnel, including, in terms of Section 25 FF of the Industrial Disputes Act, 1947. It was on the condition that:

(a) The services of the company personnel shall not be or deemed to be interrupted by such transfer.

(b) The terms and conditions of service applicable to the company personnel after such transfer are not in any way less favourable to the company personnel than those applicable to them immediately before the transfer.

(c) The purchaser is, under the terms of transfer herein, legally liable to pay to the company personnel in the event of their retrenchment, compensation on the basis that services have been continued and have not been interrupted by the transfer of business.

4. This decision to hive off and transfer the cement division by the appellant to M/s Lafarge was communicated to the employees of the cement division as well. According to the appellant, consequent upon this agreement, with the transfer of business, the employees working in the cement division were also taken over by M/s Lafarge & M/s Lafarge issued them fresh letters of appointments. These included Respondent Nos. 8-82 herein who started working with M/s Lafarge.

5. It appears that these workers were not satisfied with the working conditions in M/s. Lafarge. They submitted a statement of demand to the appellant on 15.9.2003, stating inter alia that they were directed to work with M/s. Lafarge without taking their consent. As per these respondents/ employees, impression given to them was that they would work in different departments in M/s. Lafarge for some days for smooth functioning of that establishment, which was a part of the appellant organization and thereafter they would be posted back to the parent department. They had obeyed these orders faithfully believing in the said representation. However, the concerned employees were not given all the benefits by M/s Lafarge which they were enjoying in their parent department. Thus, the demand was made to take them back with the appellant company. The company did not pay any heed to this demand. These employees approached the Deputy Labour Commissioner, Jamshedpur, raising their grievances and requesting to resolve the dispute.

6. Notices were issued to the appellant to participate in the Conciliation Proceedings. The appellant appeared and took the plea that on and from 1.11.1999, the cement division was sold to M/s. Lafarge and these workmen had become the employees of M/s. Lafarge. It was also stated that fresh appointment letters issued by M/s. Lafarge and they ceased to be the employees of the appellant. Since no amicable settlement could take place and conciliation proceedings resulted in failure. The failure report was sent by the Labour Department to the Government of Jharkhand which resulted in two reference orders, thereby referring the disputes between the parties to the Labour Court, Jamshedpur, for adjudication. The dispute was referred under Section 10(1) of the Industrial Dispute Act, 1947 with following terms and refe

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2013 Supreme(SC) 876

IMPORTANT POINT Reference u/s 10, ID Act must be appropriately worded giving true picture of the dispute.

Cases Referred (2)

IMPORTANT POINT
Reference u/s 10, ID Act must be appropriately worded giving true picture of the dispute.