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IN THE HIGH COURT OF KERALA AT ERNAKULAM
N. NAGARESH, J.
T.P. Roy, S/o. T.O. Poulose – Petitioner
Versus
Union Of India, Rep By Secretary To Government, Department Of Heavy Industry, Ministry Of Heavy Industries And Public Enterprises, Govt. Of India and Ors. – Respondents
WP(C) No. 9579 Of 2020
Decided On : 07-01-2025
(A) Industrial Employment (Standing Orders) Act, 1946 - Sections 7 and 10 - Age of superannuation - Petitioner contended that he should retire at 60 years as per Standing Orders of HMT Limited, while respondents argued for 58 years based on amendments post-bifurcation - Court upheld the amendment allowing retirement at 58 years. (Paras 4, 9, 14)
(B) Bifurcation of Company - The court found that the bifurcation of HMT Limited into HMT Machine Tools Limited was valid and legally binding, thus affecting the applicability of Standing Orders. (Paras 8, 16)
Facts of the case:
The petitioner, an employee of HMT Limited since 1992, challenged his transfer to HMT Machine Tools Limited and the subsequent retirement age of 58 years, asserting that he should retire at 60 years based on existing Standing Orders.
Findings of Court:
The court found no illegality in the amendment of the retirement age from 60 to 58 years and upheld the validity of the bifurcation of the company.
Issues: The main issues were the applicability of Standing Orders post-bifurcation and the legality of the retirement age amendment.
Ratio Decidendi: The court ruled that the amendments to the Standing Orders were valid and binding, and the bifurcation of the company was legitimate, thus allowing the retirement age of 58 years.
Result: Writ petition dismissed.
JUDGMENT :
(N. NAGARESH, J.)
The petitioner is an employee of the 2nd respondent-HMT Limited since the year 1992. Subsequent to the year 2001, a wing of the 2nd respondent-Company was separated in the name and style of HMT Machine Tools Limited.
2. The petitioner submits that no legal separation /bifurcation was effected between HMT Limited and HMT Machine Tools Limited. The petitioner continues to enjoy the service benefits available to the employees of HMT Limited. The petitioner has been informed that he stands transferred to HMT Machine Tools Limited. The age of superannuation in HMT Limited was 58 years as per Ext.P1 Standing Orders.
3. After the bifurcation in the year 2001, Ext.P1 Standing Orders continued to govern the petitioner. The Provident Fund Account of the petitioner also remained under the HMT Limited. The petitioner is a member of the HMT Employees’ Canteen Co-operative Society Limited, in which the membership is confined to the employees of HMT Limited. By Ext.P8 Office Order dated 06.06.2013, the age of supervision of the employees of HMT Limited was enhanced from 58 years to 60 years.
4. The petitioner would submit that though HMT Machine Tools Limited was bifurcated, till date, no separate certified Standing Orders as per the provisions of the Industrial Employment (Standing Orders) Act, 1946 are issued for the HMT Machine Tools Limited. Therefore, Ext.P8 amendment to the Standing Orders govern the field and the age of superannuation of the petitioner could only be 60 years. 5. In the year 2020, the petitioner was served with Ext.P9 relieving letter dated 17.04.2020. The petitioner would submit that though there are Exts.P12 to P14 judgments of this Court settling the retirement age, those judgments did not take note of the existence of Standing Orders. Ext.P9 order is therefore arbitrary and illegal, contends the petitioner.
6. The Hon’ble Apex Court in the judgment in Agra Electric Supply Company Limited v. Alladin [AIR 1970 SC 512] has held that Standing Orders under Section 10 of the Act, 1946 binds all those are presently in the employment of the concerned establishment as well as those who are appointed thereafter. This Court had upheld the validity of Standing Orders issued under the Industrial Employment (Standing Orders) Act, 1946 in Western India Match Company Limited v. Workmen [(1974) 3 SCC 330].
7. The petitioner would contend that going by Section 7 of the Industrial Employment (Standing Orders) Act, 1946 , Ext.P8 is binding on the employees of the 2nd respondent-HMT Limited and the 5th respondent-HMT Machine Tools Limited. As per the Standing Orders, the age of superannuation of employees was enhanced to 60 years and therefore, the petitioner can be made to retire only at the age of 60 years. The terms of Standing Orders are perennial in nature and is liable to be made applicable to all employees continuing in the roles of respondents 2 and 5. The petitioner therefore prayed that Ext.P9 may be quashed and respondents 2 and 3 may be directed to see that Ext.P8 is effectuated in all its establishments.
8. Respondents 2, 3 and 5 resisted the writ petition filing a counter affidavit and submitted that based on Ext.R2(c) Scheme of arrangement formulated by the HMT Limited, based on the orders of the Government of India, the HMT Limited was bifurcated and HMT Limited became the holding company of the following three subsidiaries: 1. HMT Machine Tools Limited.
2. HMT Watches Limited.
3. Chinar Watches Limited.
The assets and liabilities of each business group were transferred to the said subsidiaries. The employees were also transferred to prospective subsidiaries. The HMT Machine Tools Limited thus became distinct and different legal entity.
9. Respondents 2, 3 and 5 further submitted that in the year 2003, the Government of India directed to roll back the superannuation age from 60 to 58 in case of sick companies /loss making and unviable companies. The 5th respondent therefore filed an application before t
The court upheld the validity of the bifurcation of HMT Limited and the amendment reducing the retirement age to 58 years, affirming the applicability of the amended Standing Orders.
The retirement age policy change from 58 to 60 years applies only to HMT Limited and not to its subsidiaries, which remain governed by their own rules.
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Section 10 of IESO Act is reproduced hereunder for Duration and modification of standing orders.
Agreements on retirement age must be binding and cannot be selectively questioned; interim relief extending employment beyond retirement age is generally inadvisable.
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....
The court established that modifications to an employee's recorded date of birth must be made within one year of the Standing Order's enforcement, and late applications are not permissible.
Class IV servants engaged part-time/daily wages prior to 10.05.2001 and regularized after retire at 60 years based on engagement date; retrospective notional benefits for pension to those retired ear....
The court upheld an employer's right to legally reduce the age of superannuation from 60 years to 58 years under applicable labor laws.
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