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SOMMAIRES
CONTENTS
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Page
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Sentence arbitral du Travail
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Award of the Labour Court
.. 860
de Tribunal.
.. 871
Notifications du Gouvernement .. 871
Government Notifications
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.. 873
Avis d’Adjudications
.. 873
Tender Notices
.. 873
.. 883
Etablissements dangereux
.. 883
Dangerous Establishments
.. 883
.. 885
Annonces
.. 885
Announcements
.. 885
[ 859 ]
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2018 }
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17 {
No.
29
Poudouchéry
Mardi
17
Juillet
2018 (26 Asadha 1940)
No.
Puducherry
Tuesday
17th
July
2018
860
LA GAZETTE DE L’ETAT
[17 July 2018
GOVERNMENT OF PUDUCHERRY
LABOUR DEPARTMENT
(G.O. Rt. No. 60/Lab./AIL/T/2018,
Puducherry, dated 11th April 2018)
NOTIFICATION
Whereas, an award in I.D. (L) No.17/2007, dated
28-02-2018 of the Labour Court, Puducherry in
respect of the industrial dispute between the management
of M/s. Somkan Marine Foods Limited, Yanam and
Thiru M. Srinivas, Yanam, over non-employment Award of
the Labour Court, Puducherry has been received;
Now, therefore, in exercise of the powers conferred
by sub-section (1) of section 17 of the Industrial
Disputes Act, 1947 (Central Act XIV of 1947), read
with the Notification issued in Labour Department’s
G.O. Ms. No. 20/91/Lab./L, dated 23-5-1991, it is
hereby directed by the Secretary to Government
(Labour) that the said Award shall be published in the
Official Gazette, Puducherry.
(By order)
S. MOUTTOULINGAM,
Under Secretary to Government (Labour).
————
BEFORE THE INDUSTRIAL TRIBUNAL -CUM-
LABOUR COURT AT PUDUCHERRY
Present :Thiru G. THANENDRAN, B.COM., M.L.,
Presiding Officer.
Wednesday, the 28th day of February, 2018.
I.D. (L) No. 17/2007
M. Srinivas,
Packing Helper,
C/o. K.S. Chakaravarthy, President,
Somkan Staff Workers Union,
No. 8/321, I Cross Road,
Zicrianagar, Yanam-533 464.
. .Petitioner
Versus
1. The Managing Director,
M/s. Somkan Marine Foods Limited,
Adavipolam, Yanam.
2. Kotak Mahindra Bank Limited,
Represented by its Authorised
Signatory, Mumbai.
3. The Standard Chartered Bank,
Represented by its Authorised
Signatory, Mumbai-400 001.
4. The Managing Partner,
M/s. Image Feeds,
D. No. 5-1-063, Adavipolam,
Yanam.
. .Respondents
This industrial dispute coming on 30-01-2018
before me for final hearing in the presence of
Thiru R.S. Zivanandam, Advocate for the petitioner
and Thiruvalargal L. Sathish, S. Ulaganathan,
S. Velmurugan, V.Veeraragavan and E. Karthik,
Advocates for the respondents, upon hearing both
sides, upon perusing the case records, after having
stood over for consideration till this day, this Court
passed the following:
AWARD
1. This Industrial Dispute has been referred by the
Government as per the G. O. Rt. No. 58/2007/Lab./AIL/J,
dated 20-03-2007 for adjudicating the following:-
(i) Whether the non-employment of Thiru M. Srinivas,
Packing Helper by the management of M/s. Somkan
Marine Foods Limited, Yanam is justified?
(ii) If not, to what relief he is entitled to?
(iii) To compute the relief, if any, awarded in
terms of money, if, it can be so computed?
2. The averments in the amended claim statement
of the petitioner, in brief, are as follows:
The petitioner was a member of registered union
by name M/s. Somkan and Workers Union Regd.
No.
RTU/1444/2006 and is a worker of first
respondent Factory. The first respondent with
arbitrary power kept the union members at his mercy
depriving all the benefits provided by the Industrial
and Labour Acts. Therefore, all the members of the
union had complained to the Regional Provident Fund
Commissioner against the respondent on 20-01-2006
over the non-enrolment. The petitioner is one of the
signatories of the complaint. An enquiry was
conducted by the Commissioner, P.F. in this regard
and after found fault on behalf of the management,
Commissioner has ordered first respondent’s factory
to debt the determined due amount within 7 days of
receipt of his order. This to cause a termult the first
respondent and the passionate fiery respondent
stopped the petitioner from joining his duty on
22-5-2006. Therefore, the petitioner raised a conciliation
861
17 July 2018]
LA GAZETTE DE L’ETAT
of I.D. on 22-5-2006 through his representation. On
receipt of the representation, the conciliation was
initiated and ended in a failure. The petitioner is
innocent,
illiterate
and
poor
and
therefore,
unconscious of his rights. He has faith in respondent
but, the respondent break all the fundamental rights
and principles pertaining to the Industrial and Labour
Acts with impurity. However, the discharge of work
carried out by the petitioner since his joining in duty
i.e., 25-3-2003 as a packing helper to the satisfaction
of the management. But, the respondent make him
believes in him and removed on 22-5-2006 without
any rhyme or reason which is against natural justice.
Therefore, he has to be reinstated with back wages.
The stand taken by the management before
Conciliation Officer that no such named person with
the given address or otherwise employed by the
Company is the strategy adopted in this matter as well
as the strategy adopted before Regional P.F.
Commissioner is identical and similar. With malicious
and willful injury the workers not were provided
appointment letters and pay bills by the management.
The workmen concern left with no evidence to
substantiate their claim. In these circumstances
Enforcement Officer EPF organisation had collected
policy schedule of group JPA policies issued to
respondent Factory by the National Insurance
Company branch at Yanam. The schedule list was
verified with list of employees supplied by the
complaint and their names are shown in the policies.
After
confirmed
the
workmen
authentically
Enforcement Officer submitted his report to the
Regional PF Commissioner. The petitioner was also
shown
in
Enforcement
Officer
report.
The
Enforcement Officer report was positive proof so as
to prove that the petitioner was employee of first
respondent's factory. The first respondent Factory
has failed to produce all the records before
Conciliation Officer so as to prove that the complaint
was not working with them. Therefore, the petitioner
was the regular worker of the management and he
cannot be simply terminated. The act of the
management is arbitrary, illegal and liable to be set
aside. The Enforcement Officer report that the
employer is maintaining records of attendance to
whom they have paid P.F. only.
Therefore, the petitioner had a little evidence to
prove his employment with respondents factory. All
this was prosterous procedure adopted
by the
Management on the behest of certain unscrupulous
element who advising some industries in Yanam. “The
doctrine of hire and fire” is the principle involved in
the strategy employed by the management. The
Regional P.F. Commissioner clearly stated in his
report, dated 20-07-2006 that on 30-06-2006 a copy
of the list of the employees submitted by the
Enforcement Officer served both the management and
union. Further, the office has supplied letter, dated,
17-05-2005 given by the Somkan Staff and Workers
Union along with the list of workers to whom P.F.
benefits were not extended and other proofs to
Sri. L. Satyanarayana, Personal Officer of the
establishment. The contention of the management
that the Hon’ble High Court of Andhra Pradesh has
given direction to the P.F. Commissioner to furnish the
above-mentioned copy to the management and conduct
enquiry again was a new plea in order to suppress the
real fact. The respondent did not produce any
evidence in respect of the above contention. The
service certificate, dated 20-11-2005 issued by the
respondent factory had authenticated the employment
with the first respondent factory. Therefore, the
petitioner prays before this Court to reinstate him
with continuity of service and pay full back wages
from the date of stopped from joining his duty till the
date of reinstatement.
3. The brief averments in the counter and
additional counter filed by the first respondent are
as follows:
The respondent emphatically denied the averments
in the claim petition and stated that the petitioner
had never worked with this respondent, at any point
of in any capacity much less as helper. Taking
advantage of false and erroneous report given by the
Enforcement Officer of the provident fund the
petitioner
is
claiming employment with this
respondent. The Enforcement Officer was suspended
on corruption charges which goes to prove that the
claim was filed to gain illegal gratification and
employment on the strength of disgraced and
unreliable report. The report of Enforcement Officer
is challenged by respondent and said report is subject
matter of adjudication before the Regional P.F.
Commissioner.
The petitioner
can not
claim
employment on the strength of the said Enforcement
Officer's order because even in the enforcement
order, the name of petitioner is not substantiated .
Even otherwise, the petitioner is bound to prove his
employment with the first respondent by producing,
clinching and cogent evidence. Apart from that, the
petitioner is equally bound to prove the date till
which he worked with this respondent and the day on
which his service is terminated. The claim petition
862
LA GAZETTE DE L’ETAT
[17 July 2018
does not whisper anything about these vital
information required to claim reinstatement, which
clearly proves that the petitioner is taking undue
advantage of false report given by the Enforcement
Officer of EPF. Further, it is stated that the 1st
respondent management respondent company has
become sick and unviable and it is reeling under the
debt borrowed from the Kotak Mahindra Bank
Limited and the Standard Chartered Bank. The two
Banks who have purchased credit outstanding of this
respondent's company from CDC and SCICI latter
changed as ICICI and now the Banks have taken over
symbolical possession of the factory and all the
properties of this respondent under the Sarfesi Act, 2002.
The said Banks have also issued publication for
auction and sale of this respondent company in its
“as-is-where-is” condition. The Standard Chartered
Bank has since assigned the debts along with all
securities pertaining to this respondent in favour of
International Assets Reconstruction Company Private
limited. This respondent filed an application under
Debt Recovery Tribunal Visakhapatnam in S.A. 193/2010,
which granted stay on sale of the factory, posting the
case to be heard on 28 Jun 2011. The order of the
DRT has been suspended by Debt Recovery Appellate
Tribunal Chennai where an application was preferred
by Kotak Mahindra Bank Limited against the said
order before the Debt Recovery Appeal Tribunal,
Chennai vide N.A. 603/2010 and the same is pending
adjudication. The writ petition is also pending before
the AP High Court in WP No. 4299/2011. By application
of section 9 and 13 of Sarfasi Act 2002 as well as
section 529 (A) of the Companies Act 1956, it is the
duty of the secured creditor to address to the
grievances of the workers of Debtor Company.
Therefore, the Banks i.e., Kotak Mahindra Bank
Limited and the Standard Chartered Bank are added
as necessary parties as 2nd and 3rd respondents for
the disputes raised by the petitioners. In the unlikely
event of any award being passed by this Court having
monetary implications on this respondent, the shall
only be satisfied by Kotak Mahindra Bank Limited
and the Standard Chartered Bank as secured creditors
and no obligations can be cast upon this respondent.
Therefore, prayed this Court to dismiss the claim
petition against this respondent.
4. The petitioner has raised the industrial dispute
before the Conciliation Officer only against the first
respondent management and as the said establishment
was taken over by Kotak Mahindra Bank Limited and
The Standard Chartered Bank, they have been added as
second and third respondent in their claim petition
and the fourth respondent M/s. Image Feeds has
purchased the first respondent in auction held at the
Debt Recovery Tribunal and thereafter, the fourth
respondent was impleaded as party to the proceedings
and subsequently the case against the second and third
respondent was exonerated by the petitioner and the
fourth respondent was impleaded as party and
amended claim petition was filed by the petitioner.
5.The brief averments in the counter filed by the
4th respondent are as follows:
The fourth respondent denied all the averments
contained in the claim petition except those that are
specifically admitted and stated that the contents of
the counter statement and additional counter
statement filed by the 1st respondent may be treated
as part and parcel of this counter statement and
further, stated that it is a partnership firm engaged in
the business of sea food and other allied products.
The petitioner cannot claim reinstatement or back
wages against the fourth respondent because the first
respondent company was never directly purchased by
this respondent. The factory and the other movable
and immovable assets of the first Respondent at Yanam
had been taken in possession by consortium of Kotak
Mahindra Bank Limited and the Standard Chartered
Bank and all the assets belonging to first respondent
were brought for auction sale under the Sarfaesi Act.
The fourth respondent purchased only the land, the
building and the machinery of first respondent's
factory at Yanam as a non-functional and inoperative.
A sale certificate to that effect is issued by Kotak
Mahindra Bank Limited on 25-02-2015. Therefore, at
the time when this Respondent purchased the first
Respondent's factory asset, it was a closed and
non-functional unit without any workers, staffs or any
manpower. The fourth Respondent never had any
agreement with the first respondent or any other
person to employ the workers of first respondent.
The fourth respondent, after purchasing the land,
building and machineries of first respondent had spent
over 1.5-2 Crores in upgrading the equipment and
machinery and making the factory functional.
It started its factory operations only from 1st May, 2015.
The
fourth
respondent was
and is
under
no
legal or moral obligation to employ any of the
workers of the erstwhile owners of the factory
purchased by it as this respondent is free to employ
its own manpower and run the factory upon its terms
and conditions. The fourth respondent had therefore,
selected its own workforce, including some workers
who were engaged by first respondent. But, such
863
17 July 2018]
LA GAZETTE DE L’ETAT
employment was purely based on this respondent's
fresh terms and conditions and as fresh recruiters and
not in continuity of their employment with the first
respondent. It is a completely new and independent
entity and it has purchased only the land, building and
machineries of the first respondent and that too from
the Banks, which had taken over possession of the said
assets from the first respondent for non-payment of
their debts under the Sarfaesi Act. The petitioner, who
claims to be the worker under the erstwhile first
respondent management, has no locus standi to make
any claims of employment or even monetary
compensations with the fourth respondent under any
statute, rules, regulations or contract and hence, the
present industrial dispute is liable to be dismissed.
Therefore, prayed this Court to dismiss the claim
petition against the fourth respondent.
6. In the course of enquiry on the side of the
petitioner PW.1 was examined and Ex.P1 to Ex.P8
were marked and on the side of the respondents RW.1
and RW.2 were examined and Ex.R1 to Ex.R26 were
marked. Both sides are heard. The pleadings of the
parties, the evidence let in by either sides and the
exhibits marked on both sides are carefully
considered. On both sides written arguments were
filed and the same were also carefully considered. In
support of his contention the learned Counsel for the
respondent has relied upon the Judgments reported in
CDJ 2008 SC 218, CDJ 2005 SC 604, CDJ 2002 SC
162, CDJ 1963 SC 212, CDJ 2008 MHC 3631, CDJ
2009 Kar HC 442 & CDJ 1990 Kar HC 368.
7. The learned Counsel appearing for the petitioner
has relied upon the Judgment reported in 2013 LAB
I.C Page No. 2073 wherein it was stated that section 25.FF
comes in to play only in case of transfer of ownership
or management of an undertaking to a new employer
and not limited to some activities of the undertaking.
The learned Counsel appearing for the respondent
managements has filed a written argument stating that
the petitioner is the temporary employee of the first
respondent establishment and the name of the said
worker does not find in the muster roll of the first
respondent establishment and that it is not established
by the petitioner that he had been in service for more
than 240 days in a year though he is having burden to
prove the same the petitioner has failed to prove the
same and the claim has to be rejected.
8. The point for consideration is:
Whether the industrial dispute raised by the
petitioner over his non-employment against the first
respondent management is justified or not and if,
justified, what is the relief entitled to the petitioner.
9. It is the case of the petitioner that he was
working at the first respondent establishment from
25-03-2003 as Packing Helper and all the workers of
the first respondent establishment had complained to
the Regional Provident Fund Commissioner against
the first respondent management on 20-01-2006 over
the non-enrolment with the Provident Fund account
and he was also one of the signatories of the
complaint given by the workers of the first
respondent establishment and the Commissioner of
Provident Fund found fault with the first respondent
management and ordered the first respondent
management to pay the Provident Fund amount and
hence, the first respondent management has stopped
him from attending his duty on 22-05-2006 and he
has been terminated from service without any charge
sheet and without conducting any due enquiry and
therefore, he raised the industrial dispute on 22-05-2005
before the Conciliation Officer and conciliation was
initiated and ended in failure and meanwhile the first
respondent establishment has been purchased by the
fourth respondent management in a auction held at
Debt Recovery Tribunal and the purchaser of the first
respondent establishment the fourth respondent
management is liable to reinstate the petitioner and
to pay back wages from the date of termination.
10. In support of his case the petitioner has
examined himself as PW.1 and exhibited Ex.P1 to
Ex.P8. Ex.P1 is the representation to Assistant
Inspector of Labour over non-employment on 05-06-2006.
Ex.P2 is the failure report, dated 25.08.2006. Ex.P3
is
the copy
of representation to REPC,
dated
21-01-2006. Ex.P4 is the copy of Service Certificate
issued by the management on 20-11-2005. Ex.P5 is
the copy of E.P.F. statement report, dated 20.07.2006.
Ex.P6 is the copy of representation to RPF
Commissioner, dated 24-02-2006. Ex.P7 is the copy
of proceedings of RPFC, dated 31-05-2006. Ex.P8
is the copy of licence issued to M/s. Image Feeds,
dated, 23-06-2015. These documents would go to
show that the petitioner has raised the industrial
dispute for his non-employment before the Labour
Conciliation Officer and the conciliation was initiated
and ended in failure. Further, Ex.P4 would go to
show that the management has certified that the
petitioner was working as a Packing Helper in the
first respondent organization from 25-03-2003 and
therefore, it is clear that the petitioner has been
working at first respondent establishment and he had
been in service at first respondent establishment for
about four years.
864
LA GAZETTE DE L’ETAT
[17 July 2018
11. It is the main contention of the first respondent
that the petitioner had never worked with this
respondent at any point of time in any capacity much
less as helper and that taken advantage of false and
erroneous report given by the Enforcement Officer
of the Provident Fund the petitioner is claiming
employment with the first respondent and it is the
further
contention
that
the
first
respondent
establishment has become sick and unviable and it is
reeling under the debt borrowed from the second and
third respondent Banks who have purchased credit
outstanding of the first respondent company and taken
over symbolical possession of the factory under the
Sarfaesi Act and it was sold by the second and third
respondent in an auction held and the said property
was sold through Debt Recovery Tribunal in which the
first respondent factory was purchased by the fourth
respondent.
12. It is the contention of the fourth respondent
that movable and immovable assets of the first
respondent company alone have been taken by the
fourth respondent management and that the fourth
respondent never had any agreement with the first
respondent or any other person to employ the workers
of the first respondent and that the fourth respondent
started factory operation from 01-05-2015 and that
no legal or moral obligation to employ any of the
workers of the erstwhile owners of the factory
purchased by it as the fourth respondent is free to
employ its own man power and run the factory upon
its terms and the fourth respondent had therefore
selected its own workforce, including some workers
who were engaged by the first respondent and such
employment was purely based on the fourth
respondent's fresh terms and conditions and not in
continuity of their employment with the first
respondent and it is the further contention of the
fourth respondent that their factory is completely
new and independent entity and it has purchased only
the land , building and machineries of the first
respondent and that too from the Banks which had
taken over possession of the said assets from the first
respondent for non payment of their debts under the
Sarfaesi Act and that therefore, they are not liable to
engage the workers who were in service at the first
respondent establishment after purchasing the same
from Debt Recovery Tribunal i.e., they have no legal
or moral obligation to engage the workers of the first
respondent establishment and not having any liability
on the workers of the first respondent establishment.
13. The RW.1 the Personnel Officer of the first
respondent establishment has stated in his evidence
that the petitioner had never worked with the first
respondent establishment at any point of time in any
capacity much less as helper and that taken advantage
of false and erroneous report given by the
Enforcement Officer of the Provident Fund the
petitioner is claiming employment with the first
respondent establishment and that the petitioner is
bound to prove his employment with the first
respondent company and also bound to prove that he
has worked continuously for 240 days in the year and
hence, the petitioner is not entitle for any
reinstatement or back wages at the first respondent as
claimed by him since he had never worked with the
first respondent establishment.
14. In support of their evidence the first
respondent management has exhibited Ex.R1 to
Ex.R14. Ex.R1 is the xerox copy of muster roll of
respondent for the period from January-2006 to
August-2006. Ex.R2 is the copy of the reply letter
given by the first respondent to Assistant Inspector
of Labour-cum-Conciliation Officer, Yanam on
03-07-2006. Ex.R3 is the xerox copy of the order
in WP. No. 14506/2006 before the Hon’ble Andhra
Pradesh High Court, dated 17-07-2006. Ex.R4 is the
xerox copy of the Interim order in WP. No. 17714/
2006 before the Hon’ble Andhra Pradesh High Court,
dated 25-08-2006. Ex.R5 is the xerox copy of the order
in WP. No. 17714/2006 before the Hon’ble Andhra
Pradesh High Court, dated 11-09-2007. Ex.R6 is
the xerox copy of the order in WP. No. 8115/2009
before the Hon’ble Andhra Pradesh High Court, dated
21-04-2009. Ex.R7 is the copy of the orders passed
by EPF Appellate Tribunal, New Delhi, dated
17-09-2009. Ex.R8 is the xerox copy of the orders
passed in WP. No. 22615/2009 by Andhra Pradesh
High Court, dated 22-10-2009. Ex.R9 is the xerox
copy of possession notice given by second and third
respondent’s company, dated 14-05-2010. Ex.R10 is the
xerox copy of the sale notice published by second
respondent in the local newspaper, dated 09-08-2010.
Ex.R11 is the xerox copy of the order in writ petition
No. 4299/2011 issued by the Hon’ble High Court of
Andhra Pradesh, dated 18-05-2011. Ex.R12 is the
xerox copy of the letter given by IARC to the second
respondent intimating about the taking over of
liabilities of first respondent to third respondent on
06-07-2012. Ex.R13 is the xerox copy of the writ
notice sent by the Registrar in the Hon’ble High Court
at Andhra Pradesh. Ex.R14 is the xerox copy of the
letter given by IARC to the first respondent intimating
about the taking over of liabilities of 1st respondent
to Standard Chartered Bank on 06-12-2011.
865
17 July 2018]
LA GAZETTE DE L’ETAT
15. The documents exhibited by the first
respondent would reveal the fact that the petitioner
has made representation to the Assistant Labour
Inspector and the first respondent management has
given reply to the Assistant Labour Inspector for the
representation of the petitioner stating that no such
named person with the given address or otherwise
was employed by the company at any time and
thereafter the first respondent was taken by the Bank
and they approached the Hon'ble High Court with
regard to the same.
16. The RW.2 the Assistant Admin of the fourth
respondent has stated in his evidence that they have
purchased the plant and machineries of the first
respondent company in a bank auction under the
Sarfaesi Act and the first respondent owed huge debt
to consortium of Banks, and the movable and
immovable assets of the first respondent company
were taken in possession by consortium of Banks and
all the assets were brought for auction sale under the
Sarfaesi Act and the fourth respondent has purchased
only the land, the building and the machineries of the
first respondent firm at Yanam as a non-functional and
inoperative unit which remained closed before their
purchase and a sale certificate to that effect was
issued by second respondent Bank on 25-02-2015
and at the time when they purchased the first
respondent's factory assets, the factory was closed
and non-functional unit without any workers, staffs or
any man power and they have not had any agreement
with the first respondent or any other person to
employ the workers of the first respondent
establishment and that they have started work only
from 01-05-2015 and that they have no legal or moral
obligation to employ any of the workers of the
erstwhile owners of first respondent and that they are
free to employ their own manpower and run the
factory upon their terms and conditions and that the
fourth respondent is completely new and independent
entity and they have purchased only the land, building
and machineries of the first respondent and that too
from the consortium of Banks, which had taken over
possession of the said assets from the first
respondent and the petitioner is not in service while
they purchased the factory and machineries and they
have no obligations to employ him in his roll and pay
monetary benefits under any statue, rules, regulations
or contract.
17. In support of their evidence the fourth
respondent management has exhibited Ex.R15 to
Ex.R26.
Ex.R15
is the copy of the letter of
authorisation of Mr. S. Prasad, dated 08-11-2017. Ex.R16
is the copy of the acknowledgment of registration of
firm certificate of M/s. Image Feeds, dated 26-09-2014.
Ex.R17 is the copy of the partnership deed entered
between the partners of M/s. Image Feeds, dated
22-09-2014. Ex.R18 is the copy of the purchase of
movable and immovable mortgaged properties at
Yanam from Kotak Mahindra Bank by M/s. Image
Feeds, dated 17-12-2014. Ex.R19 is the copy of the
PAN Card of M/s. Image Feeds. Ex.R20 is the copy
of the licence issued by Yanam Municipality in favour
of M/s. Image Feeds, dated 23-06-2015. Ex.R21 is
the copy of the sale certificate issued by Kotak
Mahindra Bank in favour of M/s. Image Feeds, dated
25-02-2015. Ex.R22 is the copy of factory licence
of M/s. Image Feeds. Ex.R23 is the copy of the
acknowledge receipt issued by the Kotak Mahindra
Bank to M/s. Image Feeds for delivery of movable
properties at Yanam, dated 09-03-2015. Ex.R24 is
the copy of the acknowledgment receipt issued by
the Kotak Mahindra Bank to M/s. Image Feeds for
certifying the sale proceeds and handing over the sale
property, dated 08-04-2015. Ex.R25 is the copy of
no objection letter issued by Kotak Mahindra Bank
to the Inspector of Factories for transferring factory
licence in favour of the first respondent, dated
02-06-2015. Ex.R26 is the copy of loan application
submitted by the Managing Director of the first
respondent company and sale document.
18. The documents filed by the fourth respondent
would reveal the fact that the fourth respondent
establishment is a partnership firm registered under
Partnership Act and that the partnership deed was
entered on 22-09-2014 and licence has been issued
on 23-06-2015 by Yanam Municipality in favour of
the fourth respondent and sales certificate was issued
by Bank and that the fourth respondent management
has purchased the first respondent establishment from
the second and third respondent Banks.
19. It is learnt from Ex.P1 that the petitioner has
raised industrial dispute on 05-06-2006 and the
failure report Ex.P2 would evident that the
management has not produced the attendance register
before the Conciliation Officer. The Ex.P4 the
certificate issued by the first respondent management
would evident that this petitioner was working at the
first respondent establishment from 25-03-2003.
Though the first respondent stated that the said Ex.P4
is the forged one the same is not proved by the first
respondent management that the said certificate was
fabricated one and furthermore the Ex.P5 would
866
LA GAZETTE DE L’ETAT
[17 July 2018
evident that P.F. Commissioner has conducted an
enquiry wherein the first respondent management has
not produced records of the factory and on
verification by Enforcement Officer it was found that
99 workers including the petitioner was working at
the first respondent establishment and the first
respondent has not paid contribution and further the
Enforcement
Officer has stated that the first
respondent management has not produced the records
for the relevant period. From the evidence and
documents, it is established by the petitioner that he
is the worker of the first respondent establishment
and he had been in service for about three years for
the period from 25-03-2003 to 20-11-2005 for that
certificate was also issued by the first respondent
management under Ex.P4.
However, the first
respondent management has stated that they had
never employed the petitioner at the first respondent
establishment. But, to prove the same no evidence has
been let in by the first respondent management.
Therefore, since the petitioner had been in service
for about three years and as the first respondent
management has not produced the attendance register,
it has to be inferred that the petitioner has served
240 days in a year and it is to be taken that he is the
permanent
worker
of
the
first
respondent
establishment.
20. It is established by the petitioner through
Ex.P4 the certificate issued by the first respondent
that he had been in service at the first respondent
establishment for about three years and it is also
established by the petitioner that no domestic enquiry
was conducted against the petitioner by the first
respondent management and even did not give any
show cause notice before refusing employment. The
first respondent management has not followed any
procedure and not conducted any departmental
enquiry before discharge him from service though he
had been in service for about three years. The worker
can be removed from service if, he has committed any
misconduct or misbehavior only after conducting the
domestic enquiry. Admittedly, in this case no
domestic enquiry
was conducted by the first
respondent management before refusal of employment.
Therefore, the first respondent management is liable
to reinstate him since it has not followed the
principles of natural justice in terminating the
petitioner. Furthermore, at the time of raising the
ind ustrial d isp ute b y the petitio ner over his
non-employment against the first respondent management,
the first respondent establishment was existing
factory and that therefore, it is to be held that the
industrial dispute raised by the petitioner over his
non-employment
against
the
first
respondent
management is justified as the first respondent
establishment has not properly terminated the
petitioner by conducting domestic enquiry in
accordance with the principles of natural justice and
hence, the petitioner is entitled for reinstatement at
the first respondent establishment. However, the first
respondent establishment was taken over by the
second and third respondent Banks and sold to the
fourth respondent management and hence, the
petitioner cannot be reinstated in the first respondent
establishment and hence, the petitioner is not entitled
for any order of reinstatement at the first respondent
establishment and hence, an Award cannot be passed
against the first respondent to reinstate the petitioner
into service as employee.
21. As it is held by this Tribunal that the petitioner
is the worker of the first respondent establishment
and he has not been properly terminated by the first
respondent management by conducting domestic
enquiry in accordance with the principles of natural
justice and the industrial dispute raised by the
petitioner over his non-employment against the first
respondent management is absolutely justifiable one,
it is the question to be decided by this Tribunal that
whether the fourth respondent who have purchased the
first respondent establishment at the Debt Recovery
Tribunal is having any legal obligation of giving
employment or giving compensation to the workers
of the first respondent establishment for the service
rendered
by
them
to
the
first
respondent
establishment or not. On this aspect the evidence let
in by both sides and the exhibits marked on both sides
and arguments put forth by either side are carefully
considered.
22. It is learnt from the records that while the
industrial dispute is pending the first respondent
establishment has been taken away by second and third
respondents and the fourth respondent has purchased
the first respondent factory in the auction sale at Debt
Recovery Tribunal
i.e., the ownership and the
management of the first respondent establishment was
transferred due to the purchase and therefore, it is to
be
decided
whether
the
fourth
respondent
management is liable to pay reinstatement and other
benefits to the workers of the first respondent
establishment. On this aspect the section 25FF of the
Industrial Disputes Act has been referred which runs
as follows:
867
17 July 2018]
LA GAZETTE DE L’ETAT
“S.25FF. Compensation to workmen in case of
transfer of undertakings . Where the ownership or
management of an undertaking is transferred, whether
by agreement or by operation of law, from the
employer in relation to that undertaking to a new
employer, every workman who has been in continuous
service for not less than one year in that undertaking
immediately before such transfer shall be entitled to
notice and compensation in accordance with the
provisions of S.25-F, as if the workman had been
retrenched:
Provided that nothing in this section shall apply to
a workman in any case where there has been a change
of employers by reason of the transfer, if --
(a) the service of the workman has not been
interrupted by such transfer;
(b) the terms and conditions of service
applicable to the workman after such transfer are
not in any way less favourable to the workman than
those applicable to him immediately before the
transfer; and
(c) the new employer is, under the terms of
such transfer or otherwise, legally liable to pay to
the workman, in the event of his retrenchment,
compensation on the basis that his service has
been continuous and has not been interrupted by
the transfer.”
From the above provision it is clear that
management of an undertaking is transferred whether
by agreement or by operation of law from the
employer in relation to that undertaking to a new
employer, every workman who has been in continuous
service for not less than one year in that undertaking
immediately before such transfer shall be entitled to
notice and compensation in accordance with the
provisions of S.25-F, as if, the workman had been
retrenched. In this case the management of the
undertaking was transferred by purchase i.e., by
operation of law from the employer of the first
respondent to new employer and hence, petitioner is
entitled for notice and compensation in accordance
with the provisions of the Act. But, no such notice
was issued by the fourth respondent and no
compensation has been given to the worker as he had
been in service at the time of transfer of ownership
to the fourth respondent from the management of
first respondent establishment.
23. It is contended by the fourth respondent that
the fourth respondent cannot be compelled with the
responsibility of reinstatement or payment of any
benefits since they have purchased the plant and
machineries of the first respondent under an auction
purchase on 17-12-2014 from the Banks and hence,
the fourth respondent has no legal obligation to
employ any employees of the erstwhile first
respondent and therefore, the petitioner absolutely is
not entitled for any reinstatement in the fourth
respondent establishment or cannot seek any
compensation from the fourth respondent and in
support of his argument the learned Counsel for the
first respondent relied upon the Judgment reported in
CDJ 2009 Kar HC 442 - M. Shashikumar Vs.
Management of BPL Ltd., wherein, the Hon’ble
High Court has held that,
“31. In view of the above discussion, as a matter
of fact, neither the first respondent nor the second
respondent company was under any legal obligation
to offer employment to the employees of the
transferor company. In that view of the matter, the
only legal claim they can have access to is
retrenchment compensation………”
The learned Counsel further argued that as per the
above citation the fourth respondent management has
no legal obligation to offer employment to the
petitioners i.e., the employees of the transferor of
company and they can claim only retrenchment
benefits and that the petitioners are not having any
right to claim of any relief of reinstatement or
compensation either from the first respondent
management
or
from
the
fourth
respondent
management since the petitioners are the temporary
workers and the first respondent establishment is not
more existences as the company as it had became
sick and completely closed as early as in the year 2012
and the fourth respondent has purchased only from
the Banks under the Sarfaesi Act and it has purchased
only the plant and machineries of the first respondent
establishment without other liability and none of the
petitioners are the permanent workers of the first
respondent establishment to claim any right of any
re-employment from the fourth respondent and that
therefore, the fourth respondent has no legal
obligation to reinstate the petitioners as claimed by
them.
24. The learned
Counsel appearing for the
respondents has further argued that the fourth
respondent establishment as a purchaser transferee
management has no liability to pay any compensation
or to give any employment to the petitioner as they
have purchased the property from the second and
third respondent Banks in an auction held by them and
that the fourth respondent as a purchaser they have
no liability to re-employ the workers of the first
868
LA GAZETTE DE L’ETAT
[17 July 2018
respondent establishment and they will not pay any
compensation under section 25FF of the Act since the
workers are not the employees of the fourth
respondent establishment and in support of his
argument the learned Counsel for the respondent has
relied upon the Judgment reported in CDJ 2009 Kar
HC 442 wherein the Hon'ble Karnataka High Court
has observed that,
“……..18. That being the position in law under
section 25ff, the former employees of the company
who were not absorbed by the Corporation can hardly
make out a claim against the transferee corporation
either for compensation on termination of their
service following the transfer or for re-employment.
The claim at any rate of the employee in List II as
against the Corporation under Sec.25FF was clearly
misconceived.
19. The learned Counsel Sri. B.C. Prabhakar
appearing for second respondent contends that the
first respondent company cannot manufacture colour
television any more as entire unit of colour
television is transferred to the second respondent,
therefore, it cannot continue any employment to its
employees and had offered compensation in terms of
sec.25FF of the Act. He further contends that the
offering of compensation in terms of Sec.25FF of the
Act alone was required to the complied with by the
1st respondent and nothing else. It was also
submitted that 459 employees out of 496 employees
of the first respondent without any grievance
whatsoever have joined the second respondent
company under fresh employment after receiving
compensation from the first respondent………”.
and further the learned Counsel for the respondent
has relied upon the Judgment reported in CDJ 1990
Kar HC 368 wherein the Hon'ble Karnataka High
Court has observed that,
“……..Section 25ff makes a reference to section
25f for that limited purpose, and therefore, in all
cases to which section 25ff applies, the only claim
which the employees of the transferred concern can
legitimately make is a claim for compensation
against their employers. No claim can be made
against their employers. No claim can be made
against the transferee of the said concern. (17) The
scheme of the proviso to section 25ff emphasizes the
same policy. If, the three conditions specified in the
proviso are satisfied, there is no termination of
service either in fact or in law, and so, there is no
scope for the payment of any compensation. That is
the effect of the proviso. Therefore, reading section
25ff as a whole, it does appear that unless the
transfer falls under the transfer falls under the
proviso, the employees of the transferred concern are
entitled to claim compensation against the transferor
and they cannot make any claim for re-employment
against the transferee of the undertaking. Thus the
effect of the enactment of section 25ff is to restore
the position which the Legislature had apparently in
mind when Section 25ff was originally enacted on
September 4, 1956. By amending section 25ff, the
Legislature has made it clear that if, industrial
undertakings are transferred, the employees of such
transferred undertakings should be entitled to
compensation, unless, of course, the continuity in
their service or employment is not disturbed and that
can happen if, the transfer satisfies the three
requirements of the proviso. ……. (18) In Central
Inland Water Transport Corporation Limited, Vs. The
workmen and another it is reiterated that on a transfer
of ownership or management of an undertaking, the
employment of workmen engaged by the said
undertaking comes to an end, and compensation is
made payable because of such termination. In all
cases to which Section 25ff applies, the only claim
which the employees of the transferred concern can
legitimately make is a claim for compensation
against their employers. No claim can be made
against the transferee of the said concern. ………”.
From the above observations of the Hon’ble High
Court, it is clear that the petitioners are entitled to
claim only the compensation from the undertaking
where they have served as workers and they cannot
claim compensation or re-employment at the
transferee undertaking. But, in this case the first
respondent establishment was taken over by the
second and third respondent Banks and subsequently
the said undertaking was sold in an auction held by
them and Sales Certificate was issued by the Bank and
that therefore, the fourth respondent cannot be
compelled to pay any compensation to the employees
of the first respondent establishment. However, the
petitioner is entitled for compensation from the first
respondent establishment and the management of the
first
respondent
establishment
has
to
pay
retrenchment compensation to the petitioner under
section 25FF of the Act.
25. Further, the second and third respondent Banks
have taken over the first respondent establishment for
their debt and sold it to the fourth respondent and
hence,
the
petitioner
also
could
claim
the
compensation from the said Banks. But, it is learnt
from the records that the second and third respondent
Banks have been exonerated who have sold the first
respondent establishment in an auction sale and the
869
17 July 2018]
LA GAZETTE DE L’ETAT
sale amount was received by them and the excess
amount if, any is kept by the said Banks the petitioner
is having liberty to receive his compensation from
the said Banks by taking appropriate steps against the
Banks and the first respondent management. Even
though this Tribunal cannot pass any Award against the
second and third respondent Banks since, they sold the
first respondent establishment to the fourth
respondent and received the sale consideration and
therefore, an Award has to be passed in favour of the
petitioner to get compensation from the first
respondent establishment and the management of the
first respondent establishment is liable to pay
retrenchment compensation to the petitioner by
calculating the period of service and the salary
obtained by him from the date of joining till the date
of taken over the possession of the first respondent
establishment by the second and third respondent
Banks and that therefore, the claim against the fourth
respondent is rejected and hence, the claim petition
filed against the fourth respondent is also liable to
be rejected.
26. In the result, the petition is partly allowed and
the industrial dispute raised by the petitioner over his
non-employment
against
the
first
respondent
management is justified and an Award is passed
directing the first respondent management to pay
compensation to the petitioner by calculating the
period of service rendered by the petitioner and the
salary obtained by him from the date of joining till
the date of taken over the possession of the first
respondent establishment by the second and third
respondent Banks and further, the petitioner is at
liberty to receive compensation from the second and
third respondent Banks by taking appropriate steps
against the Banks and the first respondent
management and in respect of claim against the fourth
respondent is dismissed. No cost.
Dictated to the Stenographer, transcribed by her,
corrected and pronounced by me in the open Court
on this the 28th day of February, 2018.
G. THANENDRAN,
Presiding Officer,
Industrial Tribunal, Puducherry.
List of
petitioner’s witness:
PW.1— 26-04-2010 —
M. Srinivas.
List of petitioner’s exhibits:
Ex.P1
— 05-06-2006— R e p r e s e n t a t i o n
t o
A s s i s t a n t I n s p e c t o r
o f
L a b o u r
o v e r
non-employment.
Ex.P2
— 25-08-2006— Failure report.
Ex.P3
— 21-01-2006— Copy of representation
to REPC.
Ex.P4
— 20-11-2005— Copy
of
Service
Certificate issued by the
management.
Ex.P5
— 20-07-2006— Copy of E.P.F. statement
report.
Ex.P6
— 24-02-2006— Copy of representation
to RPF Commissioner.
Ex.P7
— 31-05-2006— Copy of proceedings of
RPFC.
Ex.P8
— 23-06-2015— Copy of licence issued
to M/s. Image Feeds.
List of
respondent’s witnessess:
RW.1 — 05-12-2017— Arjuna Babu.
RW.1 — 05-12-2017— S. Prasad.
List of respondent’s exhibits:
Ex.R1
— Jan-2006 to— Xerox copy of muster roll
August-2006
of respondent.
Ex.R2
— 03-07-2006— Copy of the reply letter
given
by
the
first
respondent to Assistant
Inspector of
Labour-
c u m - C o n c i l i a t i o n
Officer, Yanam.
Ex.R3
— 17-07-2006— Xerox copy of the order
in WP.No.14506/2006
before the Hon’ble Andhra
Pradesh High Court.
Ex.R4
— 25-08-2006— Xerox copy of the Interim
order in WP. No.17714/
2006 before the Hon’ble
A n d h r a
P r a d e s h
High Court.
Ex.R5
— 11-09-2007— Xerox copy of the order
in WP.No.17714/2006
before the Hon’ble Andhra
Pradesh High Court.
Ex.R6
— 21-04-2009— Xerox copy of the order
in
WP.No.
8115/2009
before the Hon’ble Andhra
Pradesh High Court.
Ex.R7
— 17-09-2009— Copy
of
the
orders
passed by EPF Appellate
Tribunal New Delhi.
870
LA GAZETTE DE L’ETAT
[17 July 2018
Ex.R8
— 22-10-2009— Xerox
copy
of
the
orders passed in WP. No.
22615/2009 by Andhra
Pradesh High Court.
Ex.R9
— 14-05-2010— Xerox
copy
of
possession notice given
by second and third
respondent's company.
Ex.R10 — 09-08-2010— Xerox copy of the sale
notice
published
by
second respondent in
the local news paper.
Ex.R11 — 18-05-2011— Xerox copy of the order
in Writ Petition No.
4299/2011 issued by the
Hon’ble High Court of
Andhra Pradesh.
Ex.R12 — 06-07-2012— Xerox copy of the letter
given by IARC to the
s e c o n d
r e s p o n d e n t
intimating
about
the
taking over of liabilities
of first respondent to
third respondent.
Ex.R13 — —
— Xerox copy of the Writ
Notice
sent
by
the
Registrar in the Hon’ble
High Court at Andhra
Pradesh.
Ex.R14 — 06-12-2011— Xerox copy of the letter
given by IARC to the first
respondent
intimating
about the taking over of
liabilities
of
1st
respondent to Standard
Chartered Bank.
Ex.R15 — 08-11-2017— Copy of the letter of
a u t h o r i z a t i o n
of
Mr. S. Prasad.
Ex.R16 — 26-09-2014— C o p y
o f
t h e
acknowledgment
of
registration
of
Firm
Certificate of M/s. Image
Feeds.
Ex.R17 — 22-09-2014— Copy of the partnership
deed entered between the
partners of M/s. Image
Feeds.
Ex.R18 — 17-12-2014— Copy of the purchase of
movable and immovable
mortgaged properties at
Yanam
from
Kotak
M a h i n d r a
B a n k
b y
M/s. Image Feeds.
Ex.R19 — —
— Copy of the PAN Card of
M/s. Image Feeds.
Ex.R20 — 23-06-2015— Copy of the licence
issued
by
Yanam
Municipality in favour
of M/s. Image Feeds.
Ex.R21 — 25-02-2015— Copy
of
the
Sale
Certificate issued by
Kotak Mahindra Bank in
favour of M/s. Image
Feeds.
Ex.R22 — —
— Copy of factory licence
of M/s. Image Feeds.
Ex.R23 — 09-03-2015— Copy
of
the
acknowledgment receipt
issued by the Kotak
Mahin d ra B an k
t o
M/s. Image Feeds for
delivery
of
movable
properties at Yanam.
Ex.R24 — 08-04-2015— Copy
of
the
acknowledgment receipt
issued by the Kotak
M a h i n d r a B a n k t o
M/s. Image Feeds for
certifying
the
sale
proceeds and handing
over the sale property.
Ex.R25 — 02-06-2015— Copy of no objection
letter issued by Kotak
Mahindra Bank to the
Inspector of Factories
for transferring factory
licence in favour of the
first respondent.
Ex.R26 — —
— Copy of loan application
submitted
by
the
Managing Director of the
first respondent company
and sale document.
G. THANENDRAN,
Presiding Officer,
Industrial Tribunal, Puducherry.