A settlement reached between a representative Union and an employer is binding on its members, especially when the settlement is fair and reasonable, and cannot be challenged by a minority of members after the company has ceased to exist and assets are with the Official Liquidator.

ORAL ORDER

1. By the present writ petitions, the petitioners who are workmen of the respondent No.1 - Ambeshwar Paper Mills Ltd. at Ankleshwar are challenging the award dated 18.08.2006 which has been disposed of in terms of the settlement arrived at between the parties.

2. The brief facts of the present case are that the respondent No.1 – Company became a sick company and ultimately closed down in the year 2003. The respondent No.4- Union filed Reference (IT) No. 54 of 2003 on behalf of the workmen praying for 20% salary as bonus, Rs. 5,000/- ex- gratia payment and grant of Diwali bonus after due discussion with the workers Union. The petitioners are members of the Union, pending such reference, the respondent No.4- Union and respondent No.1 - Company owners herein entered into a settlement award dated 02.08.2006. The Reference (IT) No. 54 of 2003 thereafter came to be disposed of in terms of the settlement award, taking of the same on record. Aggrieved by such settlement award, the petitioners herein have preferred the present writ petitions.

3. Learned advocate appearing on behalf of the petitioners submits that even though the petitioners were members of the respondent No.4- Union, who had filed reference proceedings, the award was not in their interest since it did not clarify the terms of such reference for settlement and also the terms of reference as raised before the Industrial Tribunal, Vadodara, were left unanswered. He further submits that the petitioners herein are mostly aggrieved by the clause in the agreement that after the settlement of the dues of the workmen, there shall be cessation of master and servant relationship, which would result in the handing over the possession of the allotted residential quarters without payment of any legal dues or terminal benefits. Learned advocate for the petitioners further submits that the settlement was sham and bogus. He submits that the settlement could not have been arrived under Section 2(P) of the I.D. Act since there was no settlement arrived at in any conciliation process and thereafter any reference proceedings came to be initiated. Learned advocate for the petitioners therefore submits that the same be set aside and the learned Reference Court / Labour Court may be directed to answer the reference on merits.

4. Per contra, learned advocate Ms. P. J. Davawala appearing on behalf of the respondent No.1 – OfÏcial Liquidator of Bombay High Court submits that the Company came to be closed down in the year 2003 and thereafter the OfÏcial Liquidator has taken over the assets of the company. She submits that thereafter the ofÏcial Liquidator had called for the claims from all the parties. However, the petitioners herein have not filed any claim before the OfÏcial Liquidator. She submits that today the Company is no longer in existence and the terms of reference cannot be answered in view of the same. She further submits that once the respondent No.4 - Union had entered into the settlement with the respondent No.1- Company, the said settlement was binding upon the petitioners herein. Learned advocate for the respondent No.1 submits that even on merits, the petitioners herein have no case. She therefore, submits that the present writ petitions be dismissed.

5. Learned advocate Mr. U.T. Mishra appearing on behalf of the respondent No.4- Union submits that since the Company was closed down since long and was declared as a sick company and was likely to be taken over by the OfÏcial Liquidator, the respondent No.4 - Union in the interest of all the workmen of the Company decided to enter into a settlement so that all the workmen get their legal dues and are not deprived of the same. He submits that accordingly the settlement came to be entered into with respondent No.1- Company. He further submits that initially 89 of 193 workmen had accepted the terms of settlement and tendered their resignations accordingly and therefore were not intereste