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Narmada Aluminium Extusion Ltd. (Old) Vs. Taj Basheer Ahmed - Court Judgment

LegalCrystal Citation
SubjectService
CourtGujarat High Court
Decided On
Case NumberCivil Application No. 10449 of 2001 in Special Civil Application No. 1131 of 2000
Judge
Reported in(2002)4GLR3588
ActsSick Industrial Companies (Special Provisions) Act, 1985 - Sections 2, 3, 16, 17, 18(4), 20(1), 22, 22(1), 25, 33C and 33C(2); Companies Act, 1956 - Sections 25; Industrial Disputes Act, 1947 - Sections 2 and 33C(2)
AppellantNarmada Aluminium Extusion Ltd. (Old)
RespondentTaj Basheer Ahmed
Appellant Advocate P.F. Makwana, Adv. for Petitioner No. 1 in Civil Application No. 10449 of 2001 and; R.D. Raval, Adv.
Respondent Advocate R.D. Raval, Adv. for Respondent No. 1,; Paresh Upadhyay, Adv. for Respondent No. 3,;
DispositionAppeal dismissed
Cases ReferredIndian Plywood Mfg.Co. v. Commissioner of Labour and Ors.
Excerpt:
- - 1354 of 1995 as well as the main special civil application and thereby dismissed the main matter against which ,the present applicant filed letters patent appeal no. it is also clear that the challenge made by the applicant against the directions issued by the tribunal has failed in special civil application and there is no stay operating against the directions issued by the tribunal and on the basis of the direction issued by the tribunal, the petitioner moved recovery application wherein the order dated 27.1.2000 was passed and that order of the labour court has not been challenged by the applicant before the higher forum and yet has not complied with the same. 1 -applicant company has made statement that he would like to file necessary application for reviewing the order dated.....h.k. rathod, j.1. heard learned advocate mr. makwana for the applicant original respondent no. 1 and mr. sen, learned agp for state of gujarat, mr. h.j. nanavaty, learned advocate for opponent no.1 and mr. paresh upadhyaya for opponent no.3.2. in para 9(a) of the present application, the applicant original respondent no.1 has prayed that the orders dated 9.5.2000 and 14.8.2001 may be recalled and/or vacated and the respondent no.1 may be exonerated from remaining present before this court. 3. brief facts of special civil application no. 1131 of 2000 filed by the petitioner tajbashir who is the workman of respondent no.1 are as under: the petitioner challenged the order passed by the labour court, bharuch in recovery application no. 7 of 1997 and 281 of 1998 dated 27th january, 2000 which.....
Judgment:

H.K. Rathod, J.

1. Heard learned advocate Mr. Makwana for the applicant original respondent No. 1 and Mr. Sen, learned AGP for State of Gujarat, Mr. H.J. Nanavaty, learned advocate for opponent NO.1 and Mr. Paresh Upadhyaya for opponent No.3.

2. In para 9(A) of the present application, the applicant original respondent no.1 has prayed that the orders dated 9.5.2000 and 14.8.2001 may be recalled and/or vacated and the respondent No.1 may be exonerated from remaining present before this Court.

3. Brief facts of special civil application NO. 1131 of 2000 filed by the petitioner Tajbashir who is the workman of respondent NO.1 are as under:

The petitioner challenged the order passed by the labour Court, Bharuch in recovery application no. 7 of 1997 and 281 of 1998 dated 27th January, 2000 which recovery application was filed by the workman in pursuance to the order passed by the Industrial Tribunal, Baroda in respect of the complaint bearing No. IT/58/92 in Reference No. IT 116 of 1992 wherein the tribunal directed the applicant company respondent no.1 in the main petition to reinstate the complainant no.1 in service with effect from 10th September, 1992 and also to reinstate the complainant No. 2 in service with effect from 27th September, 1992 and to treat them in continuous service from the respective date of their recruitment. The opponent company was further directed to pay the arrears of wages to both the complainants for the periods the complainants could not work; to complainant no.1 from 10th September, 1992 till the date of reinstatement in service and to complainant No. 2 from 27th September, 1992 till the date of reinstatement in service immediately after the publication of the award and the arrears was payable within three months from the date of publication of the order. The present applicant company has challenged the said award dated 18th July, 1994 passed by the Industrial Tribunal in special civil application no. 11009 of 1994 which was dismissed for default on 15th November, 1994 and, thereafter, an application for restoration thereof was moved by the present applicant Co. being Misc. Civil Application No. 1354 of 1995 and this Court by order dated 3rd May, 1996 passed an order in both the matters namely miscellaneous civil application no. 1354 of 1995 as well as the main special civil application and thereby dismissed the main matter against which , the present applicant filed letters patent appeal no. 724 of 1996 which has been dismissed in default for non removal of the office objection as per the statement made by Mr. P.F. Makwana, learned advocate for the applicant and, thereafter, misc. civil application for restoration of the said letters patent application was moved being misc. civil application no. 2789 of 1998 in Letters Patent Appeal No. 724 of 1996 which is pending according to the statement made by Mr. Makwana. Thus, from the aforesaid facts, it is clear that the orders for reinstatement and back wages were passed by the tribunal in favour of the workman and the same were confirmed by the learned single Judge of this court and letters patent appeal preferred against the order of the learned single Judge of this Court was dismissed for non removal of the office objections. It is also necessary to be noted that the order passed by the labour court in the aforesaid recovery applications dated 27th January, 2000 was not challenged by the present applicant company before the higher forum. In view of these facts, when the main petition came up for hearing before this court on 9th May, 2000, this court passed an order and directed the respondent NO.1 i.e. applicant herein to calculate the amount of back wages for the intervening period as directed by the labour court in recovery application no. 7 of 1997 and 281 of 1998 by order dated 27.1.2000 within one week from the date of receipt of copy of these orders and to pay the same after making such calculation within one week thereafter. This Court also directed the said respondent to consider the case of the petitioner workman for VRS as if the petitioner has been reinstated in service and has continued in service in pursuance to the orders passed by the tribunal.The matter was heard by this court on 9th May, 2000 and on that day, learned Shirastedar of this court has brought to the notice of the court that on 9th May, 2000, learned advocated Mr. Makwana has filed the sick note and, therefore, this court has not passed any order on that day but the matter was adjourned for order on 10th May, 2000. Thereafter, on 10th May, 2000, when the matter was notified, even on that day also, learned advocate Mr. Makwana has not remained present and there was no sick note or leave note of Mr. Makwana for 10th May, 2000 and yet Mr. Makwana has not remained present nor any mention was made on his behalf on that day and, therefore, this court passed order that the order dated 9th May, 2000 shall stand and the matter was thereafter adjourned for further hearing on admission on 21.6.2000.The orders passed by this Court on 9th May, 2000 and 10th May, 2000 for complying with the directions issued by the labour court in recovery applications have remained without compliance till today. It is necessary to note that the applicant has not challenged the orders passed by the labour court in recovery application or the order passed by this court on 9th/10th May, 2000 before the higher forum and yet has chosen not to comply with the said orders. It is also clear that the challenge made by the applicant against the directions issued by the tribunal has failed in special civil application and there is no stay operating against the directions issued by the tribunal and on the basis of the direction issued by the tribunal, the petitioner moved recovery application wherein the order dated 27.1.2000 was passed and that order of the labour court has not been challenged by the applicant before the higher forum and yet has not complied with the same. After this court passed orders dated 9th/10th May, 2000, the original petitioner has taken some steps by issuing notice on 18th June, 2000 and thereafter, the petitioner waited for a period of six months and thereafter filed contempt petition before this court being misc. civil application no. 2343 of 2000 wherein this court has issued notice to the applicant. On 14th August, 2001, this Court (Coram : R.R. Tripathi,J.), considering the submissions made by Mr. Raval, learned advocate for the petitioner, directed the Managing Director of the applicant company to remain present before this court at 11.00 a.m. on 3rd September, 2001. Thereafter, on 3rd September, 2001, again this Court (Coram : P.B.Majmudar,J.) passed order and it has been observed that inspite of the orders dated 14.8.2001 passed by this court, the Managing Director of the applicant company has not remained present before this court and, therefore, on 3.9.2001, while adjourning the matter to 19th September, 2001, it was directed to the Managing Director of the company to remain present on 19th September, 2001. It was clarified that in the meanwhile, if the order of this Court dated 9.5.2000 is complied with, then, it will not be necessary for the Managing Director to remain personally present on the next date. It was also clarified that in case the aforesaid order dated 9.5.2000 is reviewed by the learned Judge, it will not be necessary for him to remain present before this Court. On that day, learned advocate Mr. Makwana for the respondent No.1 - applicant company has made statement that he would like to file necessary application for reviewing the order dated 9.5.2000 passed by this court. This Court therefore adjourned the matter to 19th September, 2001 and clarified that if the aforesaid eventualities are not there, then, the Managing Director of the company shall remain personally present before this court as stated above. On 19th September, 2001, inspite of this Court's order, the Managing Director of the company Shri Dharamsinh Patel has not remained present before this Court and therefore,this Court, while observing that he is taking the order of this Court very casually, observed that the non bailable warrant is required to be issued to secure his presence and he is required to be brought before this court by the concerned police. However, on that day, learned advocate Mr. Makwana made a statement before this Court that on the next date without default, the Managing Director will positively remain present. He further states that in case the Managing Director still fails to remain present before this court, on that day, pass appropriate order for issuance of non bailable warrant and, therefore, considering his request, the matter was adjourned to 27.9.2001 by directing the Managing Director of the applicant company to remain personally present before this court or otherwise the Court will pass coercive order for securing his presence and with such directions and observations, the matter was adjourned to 27.9.2001. In this background, the present application has been filed by the applicant company which is required to be kept in mind while considering the present application.

4. Learned advocate Mr. Makwana appearing for the applicant company has raised grievance that the respondent No.1 was not given opportunity for representing his case and, therefore, the order dated 9th/10th May, 2000 is required to be recalled for giving reasonable opportunity to the applicant. In response to this grievance raised by Mr. Makwana, this Court has asked very pertinently that if the opportunity is given to make his submissions on merits, whether the learned advocate is prepared to argue the matter on merits or not. In response to this suggestion made by this court, learned advocate Mr. Makwana has agreed to argue on merits on the present application. Thereafter, this court has heard Mr. Makwana on merits.

5. Learned advocate Mr. Makwana has submitted that in the year 1996, the BIFR has initiated the proceedings against the present company and ultimately final order has been passed by the BIFR on 13th September, 2000. He relied upon the observations made by the BIFR in its order dated 13th September, 2000 which are reproduced as under:

'Under the circumstances, the Bench confirmed its prima facie opinion that the sick industrial company - M/s.Shree Narmada Aluminium Industries Ltd. (SNAIL) was not likely to make its net worth exceed its accumulated losses within a reasonable time while meeting all its financial obligations and that the company as a result thereof was not likely to become viable in future and hence it was just equitable and in public interest that it should be wound up u/s. 20(1) of the Act. This opinion may be forwarded to the concerned High Court alongwith copies of all earlier orders/proceedings for necessary action according to law.'

6. Relying upon the above observations, he has submitted that now the matter has finally been concluded by the BIFR and prior thereto, at the relevant point of time, the proceedings under the Sick Industrial Companies (Special Provisions) Act, 1985 ('the SICA Act' for short) was pending from 1991 being case No. 15/91. However, in the order passed by the Board, at the beginning, it has been referred as under:

'The Bench recalled that a scheme for the rehabilitation of M/s. Shree Narmada Aluminium Industries Limited (SNAIL) was sanctioned by the Board on 7.4.1992 u/s.18(4) of the Sick Industrial Companies (Special Provisions) Act, 1985 (hereinafter referred to as the 'Act') which was not implemented mainly due to continued adverse performance and diversion of the funds brought in for capital expenditure towards meeting cash losses.The Bench had declared the sanctioned scheme as failed in July, 1995 and had reappointed IDBI as the Operating Agency (OA) to formulate a revised rehabilitation scheme. '

7. Therefore, according to the orders passed by the BIFR, the scheme was finally sanctioned on 7th April, 1992 and the proceedings were pending from1991. In view of these facts, Mr. Makwana has submitted that because of the Ban under section 22 of the SICA Act, the workman is not entitled to any amount of recovery during the pendency of the proceedings before the BIFR. He has submitted that section 22 of the SICA Act relates to suspension of legal proceedings, contracts etc. Before appreciating his contention in that regard, it would be proper to appreciate the provisions of sec. 22 of the SICA Act. It reads as under:

'22. Suspension of legal proceedings, contracts, etc.- (1) Where in respect of an industrial company, an inquiry under section 16 is pending or any scheme referred to under section 17 is under preparation or consideration or a sanctioned scheme is under implementation or where an appeal under section 25 relating to an industrial company is pending, then, notwithstanding anything contained in the Companies Act, 1956 (1 of 1956), or any other law or the memorandum and articles of association of the industrial company or any other instrument having effect under the said Act, or other law, no proceedings for the winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof (and no suit for the recovery of money or for the enforcement of any security against the industrial company or of any guarantee in respect of any loans or advance granted to the industrial company) shall lie or be proceeded with further, except with the consent of the Board as the case may be, the Appellate Authority. '

8. He has also relied upon the decision of the Division Bench of this Court dated 30th December, 1999 in Letters Patent Appeal No. 1603 of 1999 in Special Civil Application No. 8351 of 1999 and has submitted that in the order passed by the division bench of this court, the proceedings were pending before the BIFR at the relevant time and, therefore, this court passed order to approach the BIFR for appropriate order and no mandamus can issue against the company during the pendency of the proceedings before the BIFR. Similarly, learned advocate Mr. Makwana has also relied upon the oral order passed by this court in special civil application no. 8351 of 1999 dated 26th October, 1999 and has submitted that during the pendency of the proceedings before the BIFR, no process of coercive recovery through disposition of the property of the applicant company can be initiated and the same is prohibited under section 22 of the SICA Act except with the permission of the BIFR. He has also submitted that the BIFR has also issued notice dated 7th July, 2000 to all the concerned workmen but inspite of the said notice, the present original petitioner workman has not remained present before the BIFR and no appearance has been filed by the workman. The sum and substance of the submissions made by Mr. Makwana is that in view of the pendency of the proceedings before the BIFR since 1991 wherein ultimately final order has been passed in September, 2000 which order was communicated by letter dated 13.9.2000, the order dated 9th May, 2000 is required to be modified in view of the ban under section 22 of the SICA Act. He has submitted that in view of the subsequent event of conclusion of the matter before the BIFR, the order dated 9th/10th May, 2000 is required to be modified. Except that, no other submissions on merits have been made by Mr. Makwana.

9. Learned advocate Mr. R.D.Raval appearing for the petitioner workman has submitted that the affidavit in reply of the opponent workman is ready but it has not been affirmed in view of the short notice of this Court. He has, however, placed on record copy of the reply and copy thereof has been supplied to the learned advocate Mr. Makwana for the applicant company. Mr. Raval has submitted that the order passed by the labour court, Bharuch in recovery proceedings is not challenged by the applicant company before any higher forum till this date and that order is required to be implemented by the applicant company but no payment has been made to the opponent workman inspite of the fact that the order has been passed by the labour court in recovery applications on 27.1.2000. He has further submitted that the conduct of the applicant company before the tribunal as well as before the labour court is required to be noted. He has submitted that before the tribunal and also before the labour court, the applicant company was represented through advocate and yet facts of pendency of the proceedings before the BIFR has not been disclosed by the applicant company and no reply or contention to that effect has been raised by the applicant company and no submissions to that effect has been made. He has also submitted that the labour court has passed order in recovery proceedings considering the award made by the tribunal on 18th July, 1994 and against that award, petition was preferred by the petitioner which was dismissed by the learned Single Judge of this Court and, therefore, it is the duty of the applicant company to implement the orders passed by the tribunal. Since the orders passed by the tribunal on 18th July, 1994 were not implemented, the petitioner filed recovery application wherein orders were passed by the labour court on 27.1.2000 and this court passed order dated 9th/10th May, 2000 directed the applicant company to calculate the amount of back wages for the intervening period as directed by the labour court within one week from the date of receipt of the copy of these orders and to pay the same after making such calculation within one week and the respondent No.1 was also directed to consider the petitioner's case for VRS as if the petitioner has been reinstated in service and has continued in service in pursuance to the orders passed by the tribunal. Thus, this court has only directed to implement the orders of the labour court and has not granted any further relief beyond the directions issued by the labour court by order dated 27.1.2000.

10. Learned advocate Mr. Raval has further submitted that the proceedings before the tribunal were pending up to 18th July, 1994 and yet these facts of the pendency of the proceedings before the BIFR were not disclosed by the applicant before the tribunal and has remained silent all through out. He has also submitted that there is mala fide on the part of the applicant company to say that there is ban of section 22 of the SICA Act and that is how the order passed by the Industrial Tribunal dated 18th July, 1994 has remained without implementation. Not only that, the order passed by the labour court on 27.1.2000 has also remained without implementation till this date. He has raised grievance that the company is making payment of dues to those who will surrender and accept the terms imposed by the company and as regards those who will not accept the terms imposed by the company, the company will try to take shelter of the provisions of sec. 22 of the SICA Act. He has submitted that in respect of one workman Mukesh N. Patel, there was settlement between the applicant company and said Mukesh Patel and in view of the said settlement, the labour Court, Bharuch passed order on 23rd February, 1999 in recovery application no. 7 of 1997 and by way of the said settlement, the applicant company paid an amount of Rs.35,000.00 to the said workman Shri Mukesh Patel as full and final settlement and since the petitioner workman was not able to agree with the terms imposed by the applicant company, he has not been paid the dues as directed by the labour court on the basis of the award made by the tribunal. He has submitted that since the said workman Mukesh Patel was accepting and agreeing with the terms imposed by the applicant company, in his case, contention about the the pendency of the proceedings before the BIFR has not been taken by the applicant company and since the petitioner was not agreeing with the terms imposed by the company, now the company has come forward with a plea that in view of the proceedings before the BIFR and also in view of the final orders passed by the BIFR in September, 2000, the order dated 9th/10th September, 2000 should be modified. Such discriminatory treatment given by the applicant to the petitioner workman shows mala fide and unfair labour practice of the applicant company. He has further submitted that after the orders dated 9th/10th May, 2000 passed by this court, he served notice to the applicant on 18.6.2000 and there was no response to the said notice and he waited for a period of about six months and, thereafter, filed contempt petition as stated above wherein notice has been issued by this court and the said matter is still pending before this court. He has submitted that the the applicant company was not concerned or worried about the orders passed by the tribunal or the orders passed by the labour court in the recovery proceedings dated 27.1.2000 or the orders passed by this court dated 9th/10th May, 2000 but thereafter this court passed order on 14.8.2001 and 3.9.2001 and 19.9.2001 and in view of the said orders, instead of complying with the order dated 9th/10th May, 2000 passed by this court, the applicant has chosen to file the present civil application for recalling the said orders dated 9th/10th May, 2000. He has submitted that, therefore, in view of the conduct and approach of the applicant company, the present application filed after more than one year for recalling the orders dated 9th/10th May, 2000 should be rejected with costs. He has submitted that by filing the present application, the applicant company has misused the process of the court.

11. I have considered the submissions made by the learned advocates for the parties. I have also considered the order passed by this court dated 9th/10th May, 2000 which is sought to be recalled by the applicant company. It is necessary to be noted that after this court dictated the order on 9th May, 2000, before it could be transcribed and signed by this court, it was brought to the notice of this court by the learned Shirastedar of this court that Mr. Makwana has filed sick note for 9.5.2000 and the sick note was brought to the notice of this Court immediately after it was circulated and received by the learned Shirastedar of this Court and, therefore, the order dictated on 9th May, 2000 was not signed and the matter was adjourned to 10th May, 2000 and on that day also, Mr. Makwana had not remained present nor was there any sick note or leave note filed by him. On that day, no mention for time has been made on his behalf and, therefore, by order dated 10th May, 2000, this Court ordered that the orders dated 9th May, 2000 shall stand. However, today, learned advocate Mr. Makwana has submitted that he had made mention of the matter that prior to the recess, he was busy before some other Court and, therefore, has not remained present before this Court but before that, this Court had already signed the order and, thus, from 10th May, 2000 itself, it was within the knowledge of the learned advocate for the company that such an order was passed and yet an application for recalling such order has been moved after about one year. The applicant has not moved any application for condoning delay in moving the present civil application inspite of the fact that the order passed by this Court on 9th and 10th May, 2000 was within the knowledge of the applicant as well as its advocate. During this intervening period, the applicant company has also not challenged the order dated 9th and 10th May, 2000 or the orders passed by the labour court in recovery proceedings which is the main basis of the orders dated 9th and 10th May, 2000 and this court has not granted anything except to comply with the order dated 27th January, 2000 passed by the labour court in recovery applications. There is, thus, inaction on the part of the applicant company in not immediately initiating proceedings for challenging the order dated 9th and 10th May, 2000 before the higher forum or to move appropriate application for recalling the said order immediately. I am of the view that the applicant has filed the present application only because of the fact that this court passed order on 14.8.2001 and directed the Managing Director of the applicant Company to personally remain present and which order continued upto 19th September, 2001 and, therefore, just to save the Managing Director from remaining present before the Court as per the orders subsequently passed in the main petition, the present application has been filed by the applicant company. The applicant company could have come out of such a situation by complying with the order dated 9th/10th May, 2000. The applicant company also could have come out of such a situation by challenging the said orders or the orders of the labour court in the recovery proceedings before the higher forum in accordance with law. But the applicant company has not chosen that course and has filed the present application. Therefore, I am of the opinion that such application filed after more than one year should not be entertained. The conduct of the applicant company is required to be appreciated. The applicant company has no regards for the directions and orders issued by this court and the applicant company is taking the orders of this Court in a very casual manner. I am of the view that the orders subsequently passed by this court in the main petition is the cause for filing the present application. If such orders would not have been passed by this court subsequent to the orders dated 9th and 10th May, 2000, then, the applicant would not have yet cared to file the present application.

12. As regards the contention raised by Mr. Makwana that as per section 22 of the SICA Act, 1985, there is a ban in respect of the proceedings which were initiated against the applicant company by the workman by filing recovery application under section 33-C(2) of the Industrial Disputes Act, 1947, he has placed reliance upon two orders of this Court, referred to hereinbefore. One is the order passed by the Division Bench of this Court and the another is the order passed by the learned Single Judge of this Court. In view of this contention raised by Mr. Makwana, it is necessary to refer to the decision of this Court in case of Rajnagar Textiles Mills-1 versus TLA reported in 1998 (2) GLH page 15. Same question was examined by this Court and the contention which Mr. Makwana has raised in this application has been answered by this Court in the said decision. This Court, after considering the decision reported in JT 1997 (3) SC 660, has also considered the decision reported in 1995 Lab IC 2200; 1997 (1) LLJ 1059 and thereafter, has considered the decision of the Division Bench of this Court in special civil application no. 7041 to 7068 of 1991 dated 22.1.1992 whereby the special civil applications were decided and the division bench declined to interfere with the interim order passed by the Labour Court rejecting the application for staying the proceedings in reference. This Court has also considered the decision of this court reported in 28 GLR 1204. After considering all these decisions, ultimately, the division bench of this Court has considered the effect of section 22 of the SICA Act during the pendency of the proceedings before the BIFR and has made the observations as under in paras 6 and 7 of the said decision :

'5. Mr. Vasavada appearing for the respondent association has submitted that admittedly the mill company had been declared as sick unit by an order dated 16.3.1993 but no such objection with reference to section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 was taken by the mill company either before the labour court when the order dated 12.1.1994 was passed or before the Industrial Tribunal when the order dated 27.3.1997 was passed. It has been further submitted by Mr. Vasavada that claim with regard to the loss of wages cannot be defeated with reference to the provisions of section 22 and the petitioner mill company has failed to point out any legal infirmity so far as the order passed by the labour court and the industrial court of Mehsana are concerned. He has placed reliance on the decision dated 28.4.1997 of the Bombay High Court rendered in the case of National Textile Corporation (South Maharashtra) v. B.N. Jalgaonkar and others which has been decided on the basis of the Supreme Court decision referred therein. Mr. Vasavada has made reference to judgments Today 1997 (3) SC pg. 660. He has placed reliance on 1995 Lab. IC pg. 2200 a decision of the Bombay High Court as well as 1997 (1) LLJ pg. 1059 yet another decision of the Bombay High Court. Mr. Vasavada has also referred to a Division Bench decision dated 22.1.1992 whereby Special Civil Application No. 7041 to 7068 of 1991 were decided and the Division Bench declined to interfere with the interim order passed by the labour court rejecting the application for staying proceedings in reference. Mr. Vasavada has also referred to a decision of the Single Bench of this Court reported in 28(2) GLR pg. 1204.

6. I have considered the submissions made on behalf of both the sides. First ground urged by Mr.Gupta is that the petitioner mill is virtually closed since 1992. This ground in fact, refers to the hardships faced by the petitioner company even for the purpose of making payment to the regular employees. This ground does not impress the court for the simple reason that the incapacity with regard to the making the due payment of wages does not and cannot impinge upon the validity of the orders passed by the labour court and industrial court and, therefore, in the Court's opinion, the orders passed by the labour court and industrial court cannot be set aside on this ground. So far as the second ground based on the provisions of section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985 with regard to the suspension of legal proceedings is concerned, I have gone through the various decisions on which the reliance has been placed by the parties. While perusing the order dated 9.7.1997 passed by the Single Bench in the case of National Textile Corporation (Gujarat) Ltd. v. Municipal Corporation of City of Ahmedabad, it is found that National Textile Corporation had approached this Court straightway against the Municipal Corporation and Municipal Corporation was directed to approach the BIFR with proper application claiming its dues so that the recoveries can be made in accordance with law. It was in relation to the demand of the dues on account of the municipal taxes and, therefore, the Municipal Corporation was directed to approach the BIFR. This order cannot be treated as an authority for the purpose of scope of section 22 and the embargo which has been sought to be placed on behalf of the petitioner. The order dated 29.6.1995 passed by the Division Bench in Civil Application NO. 931 of 1995 is only an interim order and the Letters Patent Appeal is yet pending and, therefore, this interim order passed by the Division Bench also cannot be treated as an authority on the scope of section 22. In the case of Maharashtra Tubes Ltd. v. State Industrial and Investment Corporation of Maharashtra (supra), the Supreme Court had held that where an inquiry is pending under sections 16/17 or an appeal is pending under section 25 of the 1985 Act, there should be cessation of the coercive activities of the type mentioned in section 22(1) to permit the BIFR to consider what remedial measures it should take with respect to the sick industrial company and this case was decided after considering the case between the Gram Panchayat and another v. Shree Vallabh Glass WOrks Ltd. and others (supra). The Supreme Court held that the expression 'proceedings' in section 22(1) must be widely construed and it cannot be confined to legal proceedings understood in the narrow sense of proceedings in a court of law or a legal tribunal for attachment and sale of debtor's property, notwithstanding the use of that expression in the marginal note. In M/s. Shree Chamundi Mopeds Ltd. v. Church of South of India Trust Association, AIR 1992 SC pg. 1439 which has been relied upon by Mr.Gupta, it was held by the Supreme Court that eviction proceedings are not covered by section 22 of the Sick Industrial Companies (Special Provisions) Act, 1985. In the case of National Textile Corporation (South Maharashtra) Ltd. v. B.N. Jalgaonkar & Others, the Bombay High Court has considered the scope and ambit of the Sick Industrial Companies (Special Provisions) Act, 1985 and after considering the Supreme Court's judgment rendered in M/s. Shree Chamundi Mopeds Ltd. v. Church of South India Trust Association and Deputy Commercial Tax Officer and others v. Corromandal Pharmaceuticals and Others reported in Judgments Today 1997 (3) SC p. 660 has observed that the question which came up for consideration before the Apex Court was whether the Sales tax dues should be recovered after company has been declared sick or a scheme has been framed under section 22 of the Act. The Bombay High Court has found that the apex Court has held that section 22 would not bar such a recovery. There are no other observations in the said judgment to support the contention that the wages due to the workers are also barred by the provisions of section 22 and that the workers will have to approach the Board in respect of the said wages. The Bombay High Court has further considered that in case section 22 is invoked even in the case of the wages due to the employees it would defraud the legitimate claim of the workmen for wages and other dues by not paying them in the first instance, forcing the workers to resort to other remedies under any of the applicable labour statutes and then pleading the bar in section 22(1). This is exactly the fact situation obtaining in the present case. The employees were first drawn to the remedy of moving application before the labour Court. Thereafter, the petitioner mill chose to prefer an appeal before the Industrial Court and now the bar of section 22 is being pleaded against them before this Court and Industrial Court. It is not the case of the petitioner company that after National Textile Corporation was declared as sick unit in 1993, BIFR has evolved or sanctioned any scheme in this regard. Section 22(1) of the Sick Industrial Companies (Special Provisions) Act, 1985 is reproduced as under :

'22. Suspension of legal proceedings, contracts, etc.- (1) Where in respect of an industrial company, an inquiry under section 16 is pending or any scheme referred to under section 17 is under preparation or consideration or a sanctioned scheme is under implementation or where an appeal under section 25 relating to an industrial company is pending, then, notwithstanding anything contained in the Companies Act, 1956 (1 of 1956), or any other law or the memorandum and articles of association of the industrial company or any other instrument having effect under the said Act, or other law, no proceedings for the winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof (and no suit for the recovery of money or for the enforcement of any security against the industrial company or of any guarantee in respect of any loans or advance granted to the industrial company) shall lie or be proceeded with further, except with the consent of the Board as the case may be, the Appellate Authority. ' According to the language of this section to proceedings for the winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof (and no suit for the recovery of money or for the enforcement of any security against the industrial company or of any guarantee in respect of any loans or advance granted to the industrial company) shall lie or the proceeded with further, except with the consent of the Board or, as the case may be, the Appellate Authority.

7. It is very clear that the prerequisites or condition precedents set out in section 22(1) are totally wanting in the facts of the present case and there is no question of defeating claim with regard to the wages and work on the basis of the provisions of sec. 22. Despite the wide import of the word 'proceeding' as have been given by the Supreme Court in the judgment delivered in Maharashtra Tubes Limited case's (supra), this COurt does not find that the impugned orders passed by the Labour Court and the Industrial Court with regard to the due wages and the work with reference to the agreement dated 24.5.1983, can be set aside so as to defeat the claim of the respondent association. On the basis of the provisions of section 2 of the Act as aforesaid, the impugned orders cannot be quashed and set aside and the embargo under section 22 does not apply to the cases where the claim is with regard to the wages and on the basis of the ratio of the Bombay High COurt's judgment which has been rendered after considering SUpreme Court in the case of the Deputy Commercial Tax Officer and Ors. (supra) this COurt is of the considered opinion that proceedings with regard to the recovery of wages and in relation to work to the employees are not covered. Whereas the contention with regard to the very applicability of section 22 is not found to be of any substance, it is not necessary for this Court to consider as to whether the petitioner could raise contention based on section 22 for the first time before this Court although the same was not raised before the Labour Court and INdustrial Court and it is held that embargo under section 22 is no impediment against the claim of the recovery of the wages as the cases with regard to the recovery of wages stand on entirely different footing and such claim stands on a different pedestal in the context of the scope of the word 'proceeding' under section 22.'

13. In the instant case also, no such objection in respect of section 22 of the SICA Act was taken by the applicant company either before the Industrial Tribunal when the order dated 18th July, 1994 was passed or before the labour court when the order dated 27th January, 2000 was passed by the labour court in the recovery proceedings though the proceedings before the BIFR were very much alive much prior to 1994 and yet for the first time the applicant company has come up with such a plea about ban under section 22 of the SICA Act. Therefore, in view of the decision of this court as aforesaid, contentions raised by the learned advocate Mr. Makwana cannot be accepted.

14. It is also necessary to refer to the decision of the Karnataka High Court in case of Indian Ply Wood Mfg. COmpany versus Commissioner of Labour in Karnataka reported in 1999 Lab. I.C. 1157. The Division Bench of the Karnataka has considered effect of section 22 of the SICA Act and the provisions made under section 33C(2) of the Industrial Disputes Act, 1947. The Division Bench, after considering the decisions on this issue, made the following observations in para 6 and 7 of the decision:

'6. The learned single Judge appears to have rightly relied upon the judgment of the Allahabad High Court reported in 1993 LLR 689, wherein it has been held:

'Both the Act have been brought on the Statute Book to carry out independent and important objects though the area for their operation is the same, that is, the industrial area. It can be said that the one looks after the defective life line of the body and the other provides for heeling of necessary limbs like hands and legs of the same body. But both are necessary to keep the whole body moving. The purpose and object of section 22 cannot be to cover those proceedings or actions which are necessary for running the industry irrespective of the fact whether it is sick or non sick. If the industry cannot run without workers the workers also cannot be expected to work without payment of their wages. The timely payment of the wages for which the provisions of the Act of 1978 have been enacted would thus be a step helping rehabilitation and it cannot be said that it created any obstacle in fulfilling the object for which the Act, 1985 has been enacted. Both the Acts are, thus, complimentary to ealch other. Section 22 cannot thus effect the proceedings under section 3 of the Act of 1978 for compelling petitioner to make payment of the wages already accrued to the workers. The Parliament while putting section 22 of the Act 1985 could never have intended that the industrial unit under the garb of sickness or for any like difficulty may be allowed to shirk its liability to pay the wages to its workers for the work they have done. Thus, proceedings under section 3 of the UP Act of 1978 will not be affected by section 22 of the Act of 1985.' The aforesaid judgment is stated to have been affirmed by the Supreme Court vide judgment reported in 1994 (1) LLJ 383 : (1983 AIR SCW 3983). The learned counsel for the appellant has however submitted that the judgment of the Allahabad High Court was set aside, though on some other point. The mere fact that the aforesaid judgment has been set aside on some other point, has not persuaded us to take a different view, as it is conceded that the Hon'ble Supreme Court did not comment upon this part of the judgment of the Allahabad High COurt while setting it aside.

A Division Bench of Bombay High Court in Girni Kamgar Sangharsha Samiti v. Khatau Mackanji SPinning & Weaving Co. Ltd. 1998 LLR 616 relying upon a judgment of Gujarat High COurt in Textile Labour Association v. State of Gujarat, 1994 (1) CLR 36 concluded;

'Having regard to the aforesaid pronouncement, we prima facie found that, in a case where wages are undisputedly due, financial liability is no defence for non payment.

In the circumstances, we direct the 1st respondent to make payment of workers who have attended and signed the muster for the period March, 1997 and onwards.'

In WOrkers of M/s. Rohtas Industries v. Rohtas Industries Ltd. 1987 (Supp) SCC 462, the Supreme Court held;

' After the sale proceeds are received by the Official Liquidator, if he finds that sufficient surplus funds remain in his hands after paying the wages as directed, he would pay the taxes, sales tax and the excise duty. In case there be no surplus, payment of the taxes may be deferred for some time and the Official Liquidator is directed to explore the possibilities of tapping other sources for raising funds to meet those liabilities. The workmen have been facing challenging to their lives and his Court on the earlier occasion indicated that in fixing priorities, saving of human lives should be paramount. We endorse that view. That has been the consideration for postponing payment of public dues, if necessary.' The Bombay High Court in an earlier case, relying upon Modi Industries' case (1993(2) CLR 963) had held;

' Reliance is placed on the observations in the aforesaid case of Modi INdustries to the effect that the Parliament could never have intended that the industrial unit under the garb of sickness or for any like difficulty may be allowed to shirk its liability to pay the wages to its workers for the work they have done. If such a position is allowed to prevail the sick company could defeat the legitimate claims of the workmen for their wages and other dues by not paying them in the first instance forcing the workers to resort to their remedies and then pleading the bar in section 22(1). No construction can be put upon the provisions of section 22, which could result in a situation of exploitation of human beings, contrary to provisions of our constitutional directives. It is, therefore, not possible to accept the contention that the payment of earned wages to the workmen (it cannot be disputed that payment under settlement would be 'wages' within the meaning of S. 2(ii) of ID Act was intended to be defeated by invoking the bar under section 2291) or to drive the workmen to run to New Delhi for seeking the consent of BIFR every time their monthly wages were required to be paid. The Bar o f section 22(1) of SICA must be held to apply only to such proceedings which are not required for the day to day running of the sick industrial company, even under a sanctioned scheme or otherwise. Any other interpretation would lead to a ludicrous and unintended result.

We also agree with the learned singloe Judge that the dictum laid down in AIR 1990 SC 1017 (The Gram Panchayat v. Shree Vallabh Glass Works Ltd.) was not applicable in the instant case. Similarly, the reliance of the appellant on 78 Company Cases 803 (sic) is also misplaced.

The learned Counsel for the appellant has further relied upon the judgment of the Supreme Court in Tata Davy Ltd. v. State of Orissa 1997 (6) SCC 669 : (AIR 1998 SC 2928) to urge that the interpretation of the words 'any other law' would include the Act and debar the Respondents herein to initiate recovery from a sick industrial company. In that case, the apex court relied upon its earlier judgment in Vallabh Glass WOrks Ltd. AIR 1990 SC 1017 wherein it had been held 'arrears of taxes and the like due from sick industrial company that satisfy the conditions in section 22 of the Central Act cannot be recovered by coercive process unless the said Board gives its consent thereto' .

7. We have already dealt with the conditions of section 22 of the 1985 Act and found no bar was created for recovery of the amounts due to the workman under section 33C of the Act. As already notices, 1985 Act is intended to make efforts for rehabilitation of the sick industrial companies, but it does not mean that such rehabilitation can be made on the heaps of the skeleton of human beings. Pending rehabilitation, the workmen and their families cannot be forced to starvation. If both the Acts deal with different situation, there is no question of imposing any embargo for recovery of such meagre amounts of money, which are necessary to keep the workmen alive.'

15. Effect of section 22 of the SICA Act has also been examined by this court in case of parmeshwar Narayan versus Collector and another reported in 1999(2) GLH 931, after considering the decision of the Bombay High Court as well as the apex court as well as the decision in case of Rajnagar Textile Mills v. Textile Labour Association, 1998 (2)GLH 15, this Court has observed as under in paragraph 6 and 7 of the judgment :

'6. Mr. M.B. Buch, learned advocate for the respondents, however, tried to distinguish the decision rendered in Rajnagar Textile Mills (supra) while contending that ti was a case when the TLA had filed an application u/S. 79(1) of the Bombay Industrial Relations Act against the company for declaration that the action of the Mill Company in respect of loss of wages by the members of TLA be declared illegal being in breach of the agreement between the parties and the Mill company be directed to make good the monetary loss on account of not giving them employment as per the agreement. The Labour Court allowed the application and declared that the company had committed breach of the agreement and accordingly the Mill company was directed to make good the monetary loss caused on account of the illegal act of the Mill company and further direction was given to give work as per the agreement. Mr. Buch, therefore, submitted that the present case being the case of execution of the order passed in Recovery Application, section 22 would bar such recovery. In substance, it was contended that trhe ceritificate issued amounted to distress proceedings which were not permissible in view of the provisions of the section 22 of the SICA.

7. In order to appreciate the rival contentions it is necessary to consider the provisions of section 22 of SICA which provide for suspension of legal proceedings, contracts. The said section reads as under:

'22. Suspension of legal proceedings, contracts, etc.- (1) Where in respect of an industrial company, an inquiry under section 16 is pending or any scheme referred to under section 17 is under preparation or consideration or a sanctioned scheme is under implementation or where an appeal under section 25 relating to an industrial company is pending, then, notwithstanding anything contained in the Companies Act, 1956 (1 of 1956), or any other law or the memorandum and articles of association of the industrial company or any other instrument having effect under the said Act, or other law, no proceedings for the winding up of the industrial company or for execution, distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof (and no suit for the recovery of money or for the enforcement of any security against the industrial company or of any guarantee in respect of any loans or advance granted to the industrial company) shall lie or be proceeded with further, except with the consent of the Board as the case may be, the Appellate Authority. xxxxx' The plain reading of section 22 makes it clear that the proceedings for winding up of the industrial company or for execution of distress or the like against any of the properties of the industrial company or for the appointment of a receiver in respect thereof (and no suit for recovery of money or for enforcement of security against the industrial company or of any guarantee in respect of any loans or advance granted to the industrial company shall lie or be proceeded with further except with the consent of the Board or, as the case may be, the appellate authority. It is also explicitly clear that section 22 bars the execution of distress proceedings or the appointment of receiver in respect of the property of the company. The recovery of money or for enforcement of any security against the company or any guarantee in respect of any loan or advance guaranteed to the company cannot be resorted to by way of a suit in a civil court. The word 'distress' used in the aforesaid section is not intended to be made the basis for depriving workmen of the recovery of their wages payable to them under the Act. It is not in dispute that in the present case, the workman had applied for recovery of his dues under section 33(c)(2) of the Industrial Disputes Act, 1947. Section 33(c) provides method by which the workman can claim money which is due from the employer. Thus, the word 'distress' used in section 22 is required to be construed so as not to deprive the wages earned by the workmen from their employer. ANy narrow meaning to the word 'distress' given excluding the wages would tantamount to defeating the purpose for which the Industrial Disputes Act is enacted. I am fortified in my view by the decision of the Division Bench of Karnataka High COurt in the case of Indian Plywood Mfg.Co. v. Commissioner of Labour and Ors.,1999(1) LLJ 411. The Division Bench in the said case, while considering the provisions of section 33(c)(2) of the SICA, has laid down that the application under section 33(c)(2) of the Industrial Disputes Act for retrenchment compensation is no bar for the authorities under the Industrial DIsputes Act to proceed notwithstanding the provisions of section 22 of SICA.The provisions of the Industrial Disputes Act and that of SICA nowhere come in conflict as they are intended to deal with different situations. In this view of the matter, it is not possible for me to accept the submissions made by Mr. Buch on behalf of respondent No. 2.'

16. In view of the aforesaid three decisions, the contention raised by Mr. Makwana that during the pendency of the proceedings before the BIFR under the provisions of the SICA Act, 1985, there is ban as per section 22 of the SICA Act against the recovery proceedings pursuant to the orders passed by the labour court by order dated 27th January, 2000 cannot be accepted and the same is required to be rejected. Same is therefore rejected.

17. One more aspect of the matter is required to be considered. By orders passed by this court dated 9th/10th May, 2000, respondent no.1 company was directed to calculate the amount of back wages for the intervening period as per the directions issued by the labour court in recovery application no. 7 of 1997 and 281 of 1998 by order dated 27th January, 2000 within one week from the date of receipt of the said order and to pay the same after making such calculation within one week thereafter. By said orders, the applicant company was further directed to consider the case of the petitioner workman for VRS as if the petitioner has been reinstated in service and has continued in service in view of the orders passed by the tribunal in the award dated 17th July, 1994. Such directions were issued by this court in view of the fact that the petition filed by the applicant company against the industrial tribunal's award was dismissed by the learned single Judge of this court and letters patent appeal against such decision has been dismissed for non removal of the office objections and application for restoration of the said letters patent appeal is pending but no effective orders are operating against the award dated 17th July, 1994 which has remained without implementation and, therefore, the petitioner workman initiated recovery proceedings wherein the labour court passed order dated 27th January, 2000 which order has not been challenged by the applicant company before the higher forum and, therefore, in view of these facts, such directions were issued by this court by order dated 9th/10th May, 2000. Not only that, before the labour court, Bharuch, in the recovery proceedings, the applicant company has not pointed out or disclosed any material before the labour court that the proceedings are pending before the BIFR and, therefore, the labour court should not pass any orders in the recovery proceedings. Not only that, it is required to be noted at the cost of repetition that in case of other workman Mukesh Patel, the applicant company has entered into compromise with the said workman as he was agreeing and surrendering himself to the terms of the company and pursuant to the said settlement, said workman has been paid by the applicant company an amount of about Rs.35000.00 and during that settlement, the proceedings before the BIFR were very much alive and pending and yet, no such contention about ban was raised by the applicant company before the labour court since the workman has obeyed the terms of the applicant company. In the instant case, the applicant company has raised such contention since the petitioner workman was not agree to accept the terms and to enter into compromise as per the terms of the applicant company and, therefore, contention about bar under section 22 of the SICA Act has been raised by the applicant. Such conduct is also required to be appreciated and condemned. When the orders passed by the labour court in the recovery proceedings were not challenged by the applicant company before the higher forum, then, it is the duty of the applicant company to comply with the said orders. This Court has therefore passed the order dated 9th / 10th May, 2000 and has issued the directions to the applicant company to pay the amount as per the directions issued by the labour court. That order dated 9th/10th May, 2000 has also remained without compliance till this date and in the present application, the applicant company has raised contention about ban under section 22 of the SICA Act. In view of the aforesaid decisions and also in view of the conduct of the applicant company, such challenge cannot be entertained in respect of the recovery of wages of a workman. It is also necessary to consider the difficulties and situation of the workman who was ordered to be reinstated in the year 1994 but has remained without reinstatement since such order was not complied with though petition filed against such directions has already been dismissed by the learned Single Judge of this Court. The workman who has been ordered to be reinstated in service in the year 1994 has yet not received the fruits of the said directions for such a long period. After the petition was dismissed by the learned single Judge of this court on 3.5.1996, the applicant company has not taken any steps for reinstating the petitioner workman for a long period and, therefore, the workman initiated recovery proceedings before the labour court pursuant to the directions of reinstatement made by the industrial tribunal wherein the labour court passed the order on 27thJanuary, 2000 but inspite of the said orders passed on 27th January, 2000, the applicant company has not taken any steps to comply with the said orders on one hand and on the other hand, has also not challenged the said order before the higher forum and thus, though the said orders were not challenged before the higher forum, same have remained without compliance even till this date. Thereafter, the workman has approached this court by filing special civil application no. 1131 of 2000 challenging the directions issued by the labour court Bharuch in so far as it relates to directions to pay the wages last drawn by the workman wherein this court passed the orders on 9th and 10th May, 2000 which too have remained without compliance till today since the company has not taken any steps for reinstating the workman. In view of that, by passing subsequent orders in the main matter, this court took serious view and directed the Managing Director of the applicant company to personally remain present before this Court and, therefore, to save the Managing Director from remaining present in person before this Court, the applicant company has moved this application after more than one year of the order dated 9th/10th May, 2000 and, therefore, on this count also, such an application cannot be entertained. It is also necessary that this court may not pass any orders in further except to dismiss the present application but at least this is considering it necessary to observe that the stand of the applicant company that inspite of the tribunal's order dated 18th July, 1994 granting reinstatement to the workman while setting aside the order of dismissal, that workman has remained without work and without fruits of the said order and as a result thereof, without wages till September, 2001. This aspect is required to be taken into account by the court at the time when some further orders will be passed in pursuance to the orders passed by this court on 19th September, 2001 and I hope that the Court may consider the question of payment of interest on the amount which has not been paid to the workman inspite of this Court's order dated 9th/10th May, 2000.

18. In view of the aforesaid observations, there is no substance in the present application and the same is filed only with a view to save the Managing Director of the applicant company from remaining personally present before this Court and, therefore, according to my view, same has been filed with a mala fide intention to see that the workman may not get wages legally due and payable to him as per the orders of the tribunal, labour court and of this court till this date, as per my view, this is the fit case wherein the applicant should be directed to pay costs.

19. For the reasons recorded hereinabove, present application is dismissed with costs. Cost is quantified at Rs.5,000.00 (Rs. five thousand only). The applicant company is directed to pay the same to the respondent workman within period of two weeks from today.


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