2018 Supreme(Mad) 4352

IN THE HIGH COURT OF MADRAS
V. PARTHIBAN, J.
Management Of EID Party India Ltd - Appellant
Versus
Presiding Officer, Industrial Tribunal - Respondent
Writ Petition No. 28373 of 2008, 19007 of 2012 and Miscellaneous Petition No. 1 of 2008, 1 of 2010, 61 of 2010, 62 of 2010, 1 of 2011, 1 of 2012, 2 of 2012
Decided on : 09-02-2018

Headnote:

Industrial Disputes Act, 1948 – Sections 25FF,25-FF,25F – Constitution of india,1950 – Articles 21,14,226 - Industrial Tribunal - denies monetary benefits and restricts re-employment - company registered under the Companies Act and was engaged in manufacturing of Sugar, Ceramics, Chemicals etc. The 9th respondent was having two Sugar Mills, viz., one at Pugalur in Tamil Nadu and the other one at Samarkhat in Andhra Pradesh. In 1992, the 9th respondent had taken a decision to dispose of the Sugar Factory at Pugalur and for the said purpose, a negotiation was held between the 9th respondent and the petitioner. After conclusion of the negotiation, the petitioner had agreed to purchase the Sugar Factory with building and machineries, but without taking over the employees, employed by the 9th respondent. An agreement was entered into as such between the 9th respondent and the petitioner on 30.10.1992 and in the said agreement, it was clearly provided that the petitioner would not take over the employees of the 9th respondent and the 9th respondent should terminate the services of the employees by settling their dues in terms of statutory regulations. In pursuance of the above agreement, a sale was concluded on 13.11.1992 and by which, the land and machineries of the Sugar Mill at Pugalur were conveyed to the petitioner and simultaneously, the 9th respondent put up a notice in the factory announcing the sale of the Unit. The 9th respondent, while terminating the services of the workmen, as agreed, paid notice pay and compensation as provided for under Section 25 FF of the Industrial Disputes Act, 1948. All the other statutory dues, viz., gratuity, PF, etc - After the sale of the Sugar Factory, the petitioner recruited its own employees on fresh terms. While recruiting its own employees, the petitioner had also offered fresh employment to more than 190 erstwhile workmen employed by the 9th respondent. The workmen of the 9th respondent, having aggrieved by the transfer ownership and resultant non-employment, raised an industrial dispute before the Government of Tamil Nadu. By the Government Order, the issue was referred to before the first respondent for adjudication. The terms of reference for the stated adjudication, are as follows: Whether the transfer of the ownership of the Sugar Undertaking at Pugalur (Deccan Sugars) to the Management of EID Parry (India) Limited by the management of Nava Bharat Ferro Alloys Limited with effect from 13.11.1992 and the resultant non employment of the workmen are justified and to what relief the workmen are entitled?” - Was there a transfer of undertaking under Section 25FF of the I.D.Act? Was this transfer vitiated by fraud? Is consent of the employees required in a case of transfer of undertaking under Section 25FF? - Whether the very transfer of ownership of the 9th respondent without the transfer of services of the workmen, is valid, legal and vitiated by fraud? - Whether the very transfer of ownership of the 9th respondent without the transfer of services of the workmen, is valid, legal and vitiated by fraud? - Whether the 9th respondent Management had complied with the Section 25-FF of the I.D.Act in its letter and spirit? - Whether findings of the first respondent Tribunal are liable to be re-appreciated on the basis such the findings are legally unacceptable and perverse - “Whether the ultimate award of the Tribunal on the basis of equitable consideration i.e. directing re-employment of the workman can be countenanced in law? - Whether the consideration of equity alone can be the basis for grant of any relief to the workman in order to achieve larger goal of securing social justice in furtherance of the constitutional scheme?” - Held, We are inclined to agree with these submissions. In recent times, there is an increasing evidence of this, perhaps well meant but wholly unsustainable tendency towards a denudation of the legitimacy of judicial reasoning and process. The reliefs granted by the courts must be seen to be logical and tenable within the framework of the law and should not incur and justify the criticism that the jurisdiction of the courts tends to degenerate into misplaced sympathy, generosity and private benevolence. It is essential to maintain the integrity of legal reasoning and the legitimacy of the conclusions. They must emanate logically from the legal findings and the judicial results must be seen to be principled and supportable on those findings. Expansive judicial mood of mistaken and misplaced compassion at the expense of the legitimacy of the process will eventually lead to mutually irreconcilable situations and denude the judicial process of its dignity, authority, predictability and respectability.” - Court is of the considered view that the transaction namely, the transfer of ownership of the 9th respondent company to the transferee company, viz., the petitioner herein is a genuine and legitimate commercial transaction in terms of the Companies Act and the plea of same being sham and nominal was only raised for the purpose of the case and therefore, the Tribunal had rightly rejected the said contention as being without merits. This Court also endorses the findings of the Tribunal without any reservation. - Court is of the considered view that the transaction namely, the transfer of ownership of the 9th respondent company to the transferee company, viz., the petitioner herein is a genuine and legitimate commercial transaction in terms of the Companies Act and the plea of same being sham and nominal was only raised for the purpose of the case and therefore, the Tribunal had rightly rejected the said contention as being without merits. This Court also endorses the findings of the Tribunal without any reservation - Court which is bound by the ratio laid down therein. This Court finds that the learned Senior Counsel objection is valid and acceptable and the attempt of the learned counsel appearing for the workmen to attract this Courts interpretative skills to dissect and vivisect the niceties of the ratio laid down by the Honble Constitution Bench has to be rejected outright as a desperate attempt made on the part of the workmen crying for attention. - Tribunal appears to be not in consonance with the statutory frame work particularly in the scheme of ID Act. Nevertheless, ultimately the conclusion has to be weighed with the overall consideration on the basis of lofty principle of equity which is enshrined in Article 14 of the Constitution of India. While adopting such perspective, this Court has to see whether the final award by the first respondent Tribunal granting the relief of reemployment to the workers with effect from 01.12.200/8 is a valid piece of award in furtherance of achieving socialistic agenda as envisaged in the preamble of the Constitution of India. - Court does not find anything legally or equitably amiss in such direction passed by the Tribunal, since the consideration which weighed with the Tribunal was long pendency of the dispute for over 16 years at the instance of the managements viz., the 9th respondent and the petitioner herein and also admitted fact that nearly 200 erstwhile workers came to be employed in the petitioner company on fresh terms. The Tribunal was also very much conscious on its limitation and refrained from ordering reinstatement of the workers as such remedy was not available to the workers after enactment of Section 25-FF of the ID Act. - Courts cannot lose sight of the larger social purpose for which they are established, particularly in industrial adjudication where bargaining power is always presumed to be tilted in favour of mighty managements. In such adjudication, the Courts, viz., the Tribunals/Labour Courts have to take into consideration various factors like violation of fundamental rights, loss of livelihood and esteem etc. which are enshrined in Article 21 of the Constitution of India. If the Courts have come to the conclusion by adopting a straight jacket formula with a narrow social and a tunnel legal vision, such conclusion shall only lead to denudation of higher social purpose and destitution of judicial conscience. An extraordinary situation calls for a path-breaking approach in order to offer extraordinary remedy with principles of fairness, equity, good conscience and socio legal justice without offending the rule of law altogether. As far as the present case on hand, the claim of reinstatement alone is prohibited when a compensation amount is paid in terms of Section 25-FF of the ID Act, there is no bar for ordering re-employment of the workers, while taking into consideration the peculiar facts and circumstance of the case - Writ Petitions are dismissed