2002 Supreme(Mad) 1244
High Court of Judicature at Madras
THE HONOURABLE MR. JUSTICE V. KANAGARAJ
Indian Oxygen Employees Union and Another - Appellant
Versus
Union of India and Others - Respondents
W.P. No.17633 of 1998 and W.M.P. Nos.26694 of 1998 & 16863 of 1999
Decided On : 28 October 2002
Section 25 FF of the Industrial Disputes Act, 1947 is designed to safeguard the genuine interest of workmen in case of transfer of an undertaking, and the relief sought by the petitioners to declare the non-existent clause requiring the consent of workmen as unconstitutional was deemed meaningless by the court.
Headnote:
Section 25 FF - Industrial Disputes - [Section 25 FF of the Industrial Disputes Act, 1947] - The court discussed the constitutional validity of Section 25 FF of the Act, which does not require the consent of a workman for transfer of services on the transfer of an undertaking. The court also considered the proviso to Section 25 FF and its implications on the terms and conditions of service, notice, and compensation for workmen in case of transfer of an undertaking.
Fact of the Case:
The petitioners sought a writ of declaration that Section 25 FF of the Industrial Disputes Act, 1947 is unconstitutional to the extent it does not require the consent of a workman for transfer of services on the transfer of an undertaking. They also sought relief for continued service and payment of wages and other dues. The respondents contested the petition, arguing that Section 25 FF is constitutionally and legally valid.
Finding of the Court:
The court found that the relief sought by the petitioners was not justified, as Section 25 FF is designed to safeguard the genuine interest of workmen in case of transfer of an undertaking. The court also noted that the proviso to Section 25 FF provides for notice and compensation, and held that the petitioners' prayer to declare the non-existent clause requiring the consent of workmen as unconstitutional was meaningless.
Issues: The main issue was the constitutional validity of Section 25 FF of the Act and whether the relief sought by the petitioners was justified.
Ratio Decidendi: The court held that Section 25 FF of the Act is designed to safeguard the genuine interest of workmen in case of transfer of an undertaking. The court also emphasized that the relief sought by the petitioners to declare the non-existent clause requiring the consent of workmen as unconstitutional was meaningless.
Final Decision: The court dismissed the writ petition and the connected Writ Miscellaneous Petitions, with no order as to costs.
The writ petition praying to issue a writ of declaration that Section 25 FF of the Industrial Disputes Act, 1947 (hereinafter referred to as "the Act") is unconstitutional to the extent it does not require the consent of a workman for transfer of the services on the transfer of an undertaking and consequently direct the second respondent to continue the second petitioner in service from 01.10.98 and pay him all the wages and other dues as before 01.10.98 or in the alternative issue a writ of declaration that the sale by the second respondent to the third respondent vide the second respondent's notice No.PD/ID/002 dated 30.09.98 does not constitute a transfer of undertaking as per the proviso to Section 25 FF of the Act and consequently direct the second respondent to continue the second petitioner in its service in the same manner as before 01.10.98 without any interruption and pay all his arrears and wages and other benefits.
2. In the affidavit filed in support of the writ petition, the petitioners would submit that the second respondent is a Public Limited Company which has branches and factories all over India with its head Office at Calcutta; that in the year 1991, the Company sold the factory situated at Calcutta to Esaab India Limited; that the Company transferred all the workmen in the factory and the employees doing the work of the medical and welding divisions in its administrative offices by invoking Section 25 FF of the Act; that this was objected to by the petitioner-Union and that the said objection was accepted as an interim injunction by this Court on 27.06.1991 and the same was made absolute on 25.10.91 in O.A. No.483 of 1991 in C.S. No.741 of 1991.
3. The petitioners would further submit that after 1991, the business of trading in medical equipments was thereafter handled by the existing employees of the second respondent who were engaged in its other activities of manufacture and trading of gas and ancillary business as well; that the employees are transferred from one post to another anywhere in the establishment and there is a common seniority list maintained for all the sections; that the second petitioner joined Indian Oxygen Limited on 08.11.65 as Clerk cum Typist at Trichy sales Depot; that he has put in 33 years of blemishless service working in various departments of the second respondent; that the second respondent is maintaining a common attendance register in the time office in which he has signed upto 07.10.98; that the order of appointment does not contain the name of a particular department to which he was appointed meaning thereby his service could be utilised in all the departments of the second respondent and that the employees working in the Ohmeda Division were all drawn from other departments of the second respondent on a rotation basis.
4. The petitioner would further submit that all of a sudden, the second respondent has published a letter ref.PD/ID/002 dt.30.09.1998 stating that Ohmeda Division has been sold to one DATEX Ohmeda India Pvt. Ltd. and the employees who happened to be working in the said division are transferred to the said new employer; that while effecting the transfer, the second respondent has neither sought consent from the affected employees nor held any discussion with the union; that the said transfer was effected in a most arbitrary manner; that if as a result of selling a portion of the business activity to DATEX, some workers had become surplus, the second respondent should have resorted to Section 25-N of the Act; the action of the second respondent in transferring the services of the second petitioner to the third respondent in the guise of transfer of undertaking under section 25 FF of the Act is patently illegal; that all the employees were paid by the second respondent and that since there has been no transfer of undertaking, the second respondent cannot transfer the second petitioner's contract of service to the third respondent.
5. The petitioners