The main legal point established in the judgment is the determination of the fairness and reasonableness of the settlement, compliance with statutory provisions, and the maintainability of the writ petition.

JUDGMENT

Prabha Sridevan, J.—These writ appeals are filed against the orders of the learned single Judge granting interim stay of the impugned settlement dated 1 8.1.2 006 entered into between the appellant and the fifth respondent on the prayer made by the first respondent herein. The facts of the matter have been dealt with in detail by the learned single Judge and therefore, we will only refer to the important facts.

2. Mr. N.G.R. Prasad, learned Counsel appearing for the writ petitioner/first respondent submitted that in the event of this Court coming to the conclusion that the stay deserves to be vacated, nothing would survive in the writ petition and therefore requested that the writ petition itself be taken up for disposal.

3. The appellant-Company was declared as a sick company by order dated 27.5.1988 by the Board of Industrial Industrial and Financial Reconstruction (BIFR) and the third respondent was appointed as the operating agency. Originally, there were three Unions - the first respondent-Union, the fifth respondent-Union and another Union by name the Metal Box Company Staff Association. But now, the Metal Box Staff Association has merged with the fifth respondent-Union. So, as far as we are concerned, there are only two Unions, the first respondentUnion being the minority Union. The appellant-Company is a multi-Unit company and we are concerned with the Chennai unit. Though a rehabilitation scheme was sanctioned by the BIFR on 10.6.1996, the matter went to the Supreme Court and finally, after hearing all parties concerned, the BIFR sanctioned the updated rehabilitation scheme by order dated 18.8.2000 and directed the third respondent to prepare the scheme provisions.

4. The aforementioned scheme provided for sale of the appellant/ Unit as an on-going Unit with its liabilities. The members of the fifth respondent-Union and the Metal Box Company Staff Association indicated that they would prefer to have a fair and reasonable settlement rather than re-employment in the company. In July 2005, notices were issued by the Labour Department to the Unions to attend the conciliation proceedings. On 28.11.2005, a settlement u/s 18(1) of the Industrial Disputes Act was entered into between the appellant, the fifth respondent and the Metal Box Company Staff Association. Thereafter, the conciliation proceedings continued, and after giving due opportunity to the first respondent-Union to participate in the signing of the settlement u/s 12(3) of the Act, the fourth respondent, after having satisfied himself of the majority status of the impugned settlement, finalized the impugned settlement u/s 12(3). Approximately, a sum of Rupees Five Crores was envisaged to be paid in aggregate to the employees as per the terms of the settlement.

5. On behalf of the first respondent-Union, it was alleged that the fourth respondent had acted mala fide and had not actively engaged himself in deciding whether the settlement was fair and reasonable and had instead, merely repeated verbatim, the terms of the 18(1) settlement entered into between the fifth respondent-Union and the appellant-Company. It is next contended that the Chennai Unit of the Company having been closed, the provisions of Section 25-O of the Industrial Disputes Act, which are mandatory, ought to have been complied with, but they had been violated. It is also submitted that the first respondent-Union was not given an opportunity by the fourth respondent to express its objections. For the above reasons, it was submitted that the first respondent-Union is justified in approaching this Court under Article 226 of the Constitution of India.

6. On behalf of the appellant-Company, it was submitted that if the first respondent-Union had any grievance, the proper recourse for them would be to approach the forums constituted under the Industrial Disputes Act. The maintainability of the writ petition was stoutly challenged. It is submitted that it is not correct to state that the fourth respo