( 1 ) THE applicants in these applications were employees of Sri Krishnarajendra Mills limited, Mysore, now under liquidation. The services of applicants were terminated by the company on February 22, 1980, March 7, 1980 and January 23, 1979 respectively. The petitioners and other similarly discharged workmen raised a dispute and the State government referred the matter to Labour court under Section 10 (l) (c) of the Industrial disputes Act, 1947 [for short, 'i. D. Act'], in reference No. 132 of 1981. The Labour Court by its award dated October 12, 1989 set aside the termination of petitioners' services and directed the company to reinstate them with full back wages, continuity of services and consequential benefits for which they were entitled to under law.

( 2 ) IN the meanwhile, on March 17, 1988 company Petition No. 43 of 1988 was filed by a creditor of the company for winding up. This court by order dated October 27,1988 ordered winding up of the company. However, that order was reviewed and this Court by a subsequent order dated July 31, 1991 held that the order of winding up dated October 27,1988, passed without taking note of the inquiry proceedings under the Sick Industrial companies (Special Provisions) Act, 1985, pending before BIFR, was void. This Court, however, after the proceedings before the bifr and AAIFR had ended, reconsidered the matter and passed an order on July 31, 1991, ordering winding up the company.

( 3 ) APPLICANTS herein filed Application No. 11 of 1991 before the Labour Court, Mysore, under Section 33-C (2) of I. D. Act to determine the amount due to them in pursuance of the award dated October 12, 1989 made in reference No. 132 of 1981 and a direction to pay the amount so determined. When the company was ordered to be wound up on July 31, 1991, leave of the Company Court was not taken to continue the proceedings under Section 33-C (2) of I. D. Act. The Official Liquidator was not made a party to the said proceedings nor notified of the said application. Nor was the Labour Court informed that the company had been ordered to be wound up. The respondent before the Labour Court [the company under liquidation] was not shown as a company under liquidation. None appeared for the respondent and the said application was allowed by the Labour Court by order dated january 13, 1993, directing the company to pay rs. 1,24,581. 86 to Basavaiah, Rs. 1,31,540. 26 to Nanjundaiah and Rs. 1,27,287. 72 to madaiah [the three applicants herein].

( 4 ) THEREAFTER, the three applicants filed these applications seeking a direction to the company in liquidation [represented by the official Liquidator] to pay the said amounts.

( 5 ) THE Official Liquidator resisted the applications inter alia, on the ground that the proceedings under Section 33-C (2) of I. D. Act were 'legal proceedings' and continuation of such proceedings without obtaining leave of the company Court, under Section 446 (1) of the companies Act, 1956 [for short the 'act'] was illegal and therefore, the order passed in such proceedings is neither valid nor enforceable.

( 6 ) APPLICANTS contended that Section 446 (1) of Companies Act is inapplicable to proceedings under Section 33-C (2) of I. D. Act. It also pointed out that in one or two similar cases, the Company Court had given effect to similar orders of the Labour Court and directed payment in terms of such orders, even though in those cases, leave had not been obtained under Section 446 of the Act; and therefore they are also entitled to payment as per order of the Labour Court.

( 7 ) THE learned Company Judge, however, was of the view that orders of Labour Court passed in proceedings under Section 33- C (2) of Industrial Disputes Act, in violation of section 446 of the Act, were unenforceable. Hence, the Learned Company Judge has referred the matter to a Division Bench. The question that therefore arises for consideration is whether an order passed by the Labour Court under Section 33-C (2) of Industri

Click Here to Read the rest of this document