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HIGH COURT OF CALCUTTA
ALTAMAS KABIR, J.
Kanoria Jute & Industries Ltd. & Anr.
Vs.
The Home Secretary, Government of West Bengal & Ors.
Matter No. 3605 of 1993
Decided on: September 15, 1994
WRIT PETITION - INACTION OF POLICE AUTHORITIES - MAINTENANCE OF LAW AND ORDER - INDUSTRIAL DISPUTE - APPOINTMENT OF RECEIVER - SCOPE OF WRIT PETITION - WORKERS' LIEN ON MILL ASSETS - PAYMENT OF SALARIES AND EMOLUMENTS.
Fact of the Case:
The petitioner company, a jute mill, was declared a sick company and a scheme for its revival was sanctioned by the Board for Industrial and Financial Reconstruction (BIFR). The petitioner no.2, a shareholder and director of the company, was running the mill on the basis of the scheme. Due to financial problems and outstanding Provident Fund liabilities, the company faced serious financial problems. A section of the workers began to take disruptive steps and prevent other workers from entering the mill premises. A strike was resorted to, leading to a temporary suspension of work. The petitioners filed applications under Sections 144(2) and 107 of the Code of Criminal Procedure before the learned Sub-Divisional Magistrate, Uluberia, Howrah, seeking police protection and action against the disruptive workers. The magistrate observed that he had already directed the Officer-in-Charge, Uluberia Police Station, to make adequate police arrangements and keep a close watch on the activities of antisocial elements. The magistrate did not consider it necessary to issue any further orders on the applications filed by the petitioners. The petitioners moved a revisional application in the High Court under Section 482 of the Code of Criminal Procedure, which was still pending disposal.
Finding of the Court:
The court observed that the scope of the writ petition was confined to the alleged inaction of the police and local authorities in maintaining law and order in and around the mill premises, despite the repeated complaints of the writ petitioners with regard to the obstacles created to the smooth running of the mill by a section of the workers. The court held that it could not widen the scope of the writ petition at the instance of the respondents and allow a prayer for the appointment of a receiver for the purpose of taking charge of the finished products and the raw materials within the mill premises and to sell off the same in order to liquidate the dues of the workmen, as this would have a totally opposite effect to the prayers made in the writ petition. The court further held that if the writ petition succeeded, it would lead to an incongruous situation if the prayer for the appointment of a receiver was also allowed simultaneously.
Issues: 1. Whether the writ petition was maintainable in light of the proceedings under Section 144 of the Code of Criminal Procedure? 2. Whether the police authorities were liable for inaction in maintaining law and order around the mill premises? 3. Whether the workers had acquired a lien on the raw materials and finished goods lying in the mill premises due to their contribution to the working capital of the petitioner company? 4. Whether the petitioners were liable to pay salaries and other emoluments to the workers for the broken month of November 1993?
Ratio Decidendi: 1. The court held that the writ petition was maintainable as it was not dependant upon the proceedings under Section 144(2) of the Code of Criminal Procedure or the orders passed therein by the learned magistrate. The court observed that a writ in the nature of Mandamus may be issued to compel performance of statutory duties, and that the police authorities had a continuous duty to maintain law and order and to prevent any serious breach of the peace. 2. The court held that the police authorities were liable for inaction in maintaining law and order around the mill premises. The court observed that definite materials had been provided which called for the intervention of the police authorities for the benefit of all concerned, including the workers, for maintaining an atmosphere which could have been conducive for negotiation between the parties, instead of ending in closure of the mill. 3. The court held that the workers had not acquired a lien on the raw materials and finished goods lying in the mill premises due to their contribution to the working capital of the petitioner company. The court observed that the relevant portion of the scheme sanctioned by the BIFR provided that the workmen shall agree to deposit, on interest-free basis, an amount of Rs. 11/- per person per day, for a period of 5 years from January 1991 to December 1995, and the same would be repayable after the rehabilitation period in such suitable instalments, as may be agreed to by the management of the company and the representatives of the labour unions, on the basis of mutual consultation six months period to the rehabilitation period. 4. The court held that the petitioners were liable to pay salaries and other emoluments to the workers for the broken month of November 1993. The court observed that if the closure was lifted and work in the mill was resumed, the petitioners shall pay to the workers their salaries and other emoluments for the broken month of November, 1993, within a week from the date of re-opening of the mill.
Final Decision: The writ petition was allowed to the extent that the respondents were directed to ensure that there was no breach of the peace in and around the mill premises and that all employees, officers and staff, as are willing to resume their duties in the mill, if and when the closure is lifted, are able to peacefully enter and leave the mill premises without any obstruction. The respondents were also directed to ensure that for the purpose of operating the mill, there is no obstacle or hindrance to the entry of raw materials in the mill premises and the removal of finished goods therefrom. The petitioners were directed to pay to the workers their salaries and other emoluments for the broken month of November 1993, within a week from the date of re-opening of the mill. The court also directed that if any other dues are payable to the workmen, the petitioners shall take expeditious steps to payoff the same, in accordance with law and the rehabilitation scheme.
The Court: The writ petitioner No. 1 is a Company incorporated under the Companies Act, 1956, and owns a jute mm at Sijberia, under Uluberia Police Station, in the district of Howrah.
2. The writ petitioner No.2 is a share-holder and Director of the said Company, and, at the material time, he was running the said mill on the basis of a scheme sanctioned by the Board for Industrial and Financial Reconstruction in the month of February, 1991.
3. From the case made out in the writ petition it appears that on or about 15th September, 1987, the petitioner Company was declared a sick company within the meaning of the Sick Industrial Companies (Special Provisions) Act, 1985. The Board of Industrial and Financial Reconstruction, hereinafter referred to as BIFR, initially appointed the Industrial Reconstruction Bank of India and, thereafter, the Industrial Financial Corporation of India as Operating Agencies to formulate a scheme for revival of the petitioner Company. However, as no scheme was forthcoming, the petitioner No.2 submitted a scheme for reviving the Company which, as mentioned hereinbefore, was accepted and approved by the BIFR in February, 1991 and the petitioner No.2 was al10wed to take over the management of the Company in terms of the said scheme.
4. According to the petitioners, as a result of failure by the financial institutions in providing timely financial assistance, the Company had to face serious financial problems as it inherited huge liabilities from the past management. One of the biggest liabilities was the outstanding Provident Fund liabilities, part of which was liquidated, while a large amount still remains to be paid.
5. It is the petitioners' case that while sincere attempts were being made to revive the Company, on and from the month of October, 1993 a certain section of the workers began to take disruptive steps by taking recourse to various illegal activities in and around the mill premises of the petitioner Company and inspite of repeated requests and complaints made to the police authorities, no positive action was taken by them and there was no improvement in the situation.
6. According to the petitioners, on being emboldened by the inaction of the police, on and from 15th November, 1993, a certain section of the workers began to prevent the other workers from entering the Mill premises and discharging their duties. Thereafter, the said workers also began picketting in front of the Mill gates and prevented lorries from entering into the Mill premises to take out the finished products.
7. It is the further case of the petitioners that on and from 23rd November, 1993, a section of the workers at the Mill resorted to a strike, thereby completely paralysing all activities at the Mill. Since all efforts to lift the strike failed, the management of the petitioner Company declared temporary suspension of work on and from 26th November, 1993, and such closure is still continuing.
8. Consequent thereupon, the petitioner Company appears to have filed applications under Ss. 144(2) and 107 of the Code of Criminal Procedure before the learned Sub-Divisional Magistrate, Uluberia, Howrah, on 9th December, 1993. By his order of even date the learned magistrate observed that on 30th November, 1993, he had already directed the Officer-in-Charge, Uluberia Police Station, to make adequate police arrangements and to keep a close watch on the activities of antisocial elements and also to ensure that no one obstructed the free movement of the staff and officers of the petitioner Company. The learned magistrate also directed the said police authorities to take appropriate action on complaints lodged against incidents of threat, theft and criminal trespass. In view of the said directions, the learned magistrate did not consider it necessary to issue any further orders on the applications filed by the petitioner Company under Ss. 144(2) and 107 of the Code of Criminal Procedure and directed that the same be filed.
9. Sinc
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