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IN THE HIGH COURT OF KARNATAKA AT BENGALURU
SURAJ GOVINDARAJ, J.
M/S STUMPP SCHUELE AND SOMAPPA PVT. LTD. – Petitioner
Versus
BASAVARAJA M. S/O LATE SHRI NARASIMHAIAH – Respondent
Writ Petition No. 58467 of 2013
Decided On : 06-09-2022
Companies Act, 1956 - Industrial Employment (Standing Orders) Act, 1946 - Section 3(2), 2(d), (e), 3, 13-B, 10 - Karnataka Shops and Commercial Establishments Act, 1961 - Section 12-A, 3 and 4 , 10(2), 6, 5(3), 10(3) - Payment of Wages Act, 1936, - Section 2 - Factories Act, 1948 - Section 2(m) - Mines Act, 1952 - Indian Railways Act, 1890 - Section 2 and 4 - Employees - Age of Retirement - Whether Certified Standing Orders are applicable to all Units/industrial establishments of a Company or are they specific to a particular industrial establishment - Could a Company have different ages of retirement for its different industrial establishments - On an amalgamation of two Companies and industrial Establishments owned by said Companies, which Standing Orders would apply to employees - Could it be contended that Standing Orders most beneficial to employee would apply to employee. [Para 20.4]
Finding of the Court: Whenever any Standing Orders are certified, it would be in force for a period of six months and thereafter, employer or workman or a trade union or a representative body of workman can apply to Certifying Officer for modification of Standing Orders - Until and unless same is done, CSOs would continue to be in operation - In present case, only contention of respondent No. 2 which has been accepted by Industrial Tribunal is that on account of Nippon Electronics India Private Limited being amalgamated with M/s. Stumpp Schuele and Somappa Private Limited, Standing Orders of M/s. Stumpp Schuele and Somappa Private Limited which provided for retirement age of 58 years would apply to employees of Nippon Electronics India Private Limited - For reasons aforementioned and points above answered, said finding of Industrial Tribunal is improper inasmuch as amalgamation or otherwise would not by itself have an effect of modifying CSOs - For purpose of such modification, procedure prescribed under Section 10 of IESO Act is required to be followed - As held above, Standing Orders being applicable to a particular industrial establishment, mere amalgamation would not have any effect of super-session or modification of CSOs - In view thereof, Court is of considered opinion that reasoning of Industrial Tribunal not being proper and not being in accordance with law, order passed by Industrial Tribunal suffers from legal infirmity and as such, it is required to be set aside.
Result: Petition allowed.
ORDER :
1. The petitioner is before this Court seeking for the following reliefs:
2. The petitioner is a Company incorporated under the Companies Act, 1956 having its factory at Hosur Road, having an independent factory licence bearing No. MYB 679, having Certified Standard Orders (CSO).
3. There was one other Company viz. M/s. Nippon Electronics (India) Private Limited (for short ‘Nippon’) which was operating at Bull Temple Road, Bangalore, which also had separate CSO.
4. The respondent had been employed with Nippon. Nippon was amalgamated with the petitioner-Company by virtue of the order passed by this Court in CoP No. 27/1983 clubbed with C.A. No. 165/1983 dated 06.06.1984.
5. It is contended that after amalgamation, the Unit of Nippon was referred to as M/s. Stumpp Schuele and Somappa Private Limited (Electronics Division), Bull Temple Road and the existing unit was referred to as M/s. Stumpp Schuele and Somappa Private Limited (Hosur Road Division). Thus, both the Hosur Road and the Bull Temple Road units existed separately as independent industrial establishments of the petitioner-Company with their respective CSOs.
6. In terms of Clause 19 of the CSO of Nippon, the age of retirement was fixed as 55 years whereas in terms of the CSO of the Hosur Road Unit, the age of retirement was fixed as 58 years.
7. The respondent having attained superannuation at the age of 55 years as per the birth details furnished by the respondent at the time of his appointment, the petitioner-Company informed the respondent vide letter dated 14.04.2005 that the respondent would be relieved on the close of working hours on 14.05.2005.
8. It is in that background that the Electronic Division at Bull Temple Road had raised a dispute claiming that retiring them at the age of 55 years is contrary to law. The Government of Karnataka vide endorsement dated 31.03.2006 had informed the employees that the retirement of the employees at 55 years is in accordance with the CSOs and the Settlement signed with the Union in 1977 and 1986 and as such, there was no violation of the CSO.
9. The respondent, issued a notice dated 03.07.2007 contending that he would retire only at the age of 58 years since the CSOs of the Hosur Road Unit/industrial establishment indicated that the retirement age would be 58 years.
10. The petitioner-Company replied to the same informing the respondent that the respondent being an employed in the Electronic Division at Bull Temple Road, the CSOs for the said Unit/industrial establishment prescribing 55 years as retirement age, it is that age which would be applicable.
11. In the above background, the respondent raised a dispute alleging premature retirement which came to be referred to the Industrial Tribunal by the Government of Karnataka and registered as I.D. No. 42/2007. After hearing the parties, the Industrial Tribunal vide its award dated 03.07.2013 held that the petitioner was not justified in retiring the respondent on 14.05.2005 and it is aggrieved by the said award, the petitioner-Company is before this Court.
12. Sri. S.N. Murthy, learned Senior Counsel appearing for the petitioner would submit that:
Section 10 of IESO Act is reproduced hereunder for Duration and modification of standing orders.
Each industrial establishment of a Company can have different Certified Standing Orders and different ages of retirement. On amalgamation, the CSOs applicable to each industrial establishment continu....
The main legal point established in the judgment is that settlements between the employer and the trade union have binding nature, and subsequent amendments to the Model Standing Orders cannot be use....
Chapter IVA contained Section 41A to 41H of the Factories Act, 1948 deals with ‘Provisions relating to Hazardous Process’, these provisions deal with the manner of setting up of a factory dealing wit....
Point of Law : Under the Industrial Disputes Act, a settlement has been defined as a settlement which is arrived at during a conciliation proceeding and it also includes a written agreement arrived a....
The main legal point established in the judgment is that the amendment of Certified Standing Orders under the Industrial Employment (Standing Orders) Act, 1946, can be justified in law if made in acc....
The main legal point established in the judgment is that the retirement age can be increased based on factors such as the nature of work, financial aspects, global trends, and judicial opinion, and e....
Agreements on retirement age must be binding and cannot be selectively questioned; interim relief extending employment beyond retirement age is generally inadvisable.
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