IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 25TH DAY OF OCTOBER, 2019 BEFORE THE HON'BLE MRS. JUSTICE S.SUJATHA C.A.No.164/2019 IN C.O.P.No.112/1994 c/w C.A.No.175/2019 IN C.O.P.No.112/1994, C.A.No.177/2019 IN C.O.P.No.112/1994, C.A.No.179/2019 IN C.O.P.No.112/1994, C.A.No.181/2019 IN C.O.P.No.112/1994, C.A.No.183/2019 IN C.O.P.No.112/1994, C.A.No.185/2019 IN C.O.P.No.112/1994, C.A.No.187/2019 IN C.O.P.No.112/1994, C.A.No.189/2019 IN C.O.P.No.112/1994 AND C.A.No.191/2019 IN C.O.P.No.112/1994 IN C.A.No.164/2019 IN C.O.P.No.112/1994: BETWEEN:
KAMARUDDIN S/O GHOUSE MOHIYUDDIN, AGED ABOUT 60 YEARS, R/AT #11, BELAGOLA, SRIRANGAPATNA TALUK, MANDYA DISTRICT. … APPLICANT (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-D PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
IN C.A.No.175/2019 IN C.O.P.No.112/1994: BETWEEN:
1. DEVAIAH SINCE DEAD BY LRS 1(a) SMT.SAROJAMMA W/O LATE DEVAIAH, AGED ABOUT 67 YEARS 1(b) SRI D.MAHADEVA S/O LATE DEVAIAH, AGED ABOUT 47 YEARS 1(c) SRI SHYLESHA S/O LATE DEVAIAH, AGED ABOUT 42 YEARS 1(d) SRI ANANDA S/O LATE DEVAIAH AGED ABOUT 39 YEARS ALL ARE R/AT SEEBAN MANTI, BELAGOLA HOBLI SRIRANGAPATNA TALUK MANDYA DISTRICT-571606 … APPLICANTS (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-AH PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
IN C.A.No.177/2019 IN C.O.P.No.112/1994: BETWEEN:
MARIGOWDA S/O LATE ERAIAH, AGED ABOUT 64 YEARS R/AT # 93A, MNPM COLOMY, BELAGOLA, SRIRANGAPATNA TALUK, MANDYA DISTRICT-571606 … APPLICANT (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-AH PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
IN C.A.No.179/2019 IN C.O.P.No.112/1994: BETWEEN:
SHIVALINGEGOWDA S/O CHIKKALINGEGOWDA AGED ABOUT 70 YEARS R/AT MEGALA BEEDI, C BLOCK, BELAGOLA, SRIRANGAPATNA TALUK, MANDYA DISTRICT-571606 … APPLICANT (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-F PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
IN C.A.No.181/2019 IN C.O.P.No.112/1994: BETWEEN:
CHELUVEGOWDA S/O HOSAMANE CHELUVEGOWDA, AGED ABOUT 62 YEARS, R/AT EX.C704, BELAGOLA, SRIRANGAPATNA TALUK, MANDYA DISTRICT-571606. … APPLICANT (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-F PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
IN C.A.No.183/2019 IN C.O.P.No.112/1994: BETWEEN:
1 . MAYEE GOWDA SINCE DEAD BY HIS LRS 1(a) PUTTATHAYAMMA W/O LATE MAYEE GOWDA AGED ABOUT 58 YEARS 1(b) LAKSHMI D/O LATE MAYEE GOWDA AGED ABOUT 29 YEARS 1(c) CHANDRA S/O LATE MAYEE GOWDA AGED ABOUT 27 YEARS ALL ARE R/AT 47/A, MNPM HOUSING COLONY, BELAGOLA, SRIRANGAPATNA TALUK, MANDYA DISTRICT-571606 … APPLICANTS (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-F PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
IN C.A.No.185/2019 IN C.O.P.No.112/1994: BETWEEN:
1 . RAMEGOWDA SINCE DEAD BY HIS LRS 1(a) MANIYAMMA W/O RAMEGOWDA, AGED ABOUT 51 YEARS 1(b) MADHUKUMAR S/O RAMEGOWDA, AGED ABOUT 34 YEARS 1(c) MANU S/O RAMEGOWDA, AGED ABOUT 32 YEARS ALL ARE R/AT BELAGOLA SRIRANGAPATNA TALUK, MANDYA DISTRICT. … APPLICANTS (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-II PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
IN C.A.No.187/2019 IN C.O.P.No.112/1994: BETWEEN:
1 . RAMEGOWDA SINCE DEAD BY HIS LRS 1(b) SHANTHAMMA W/O LATE RAME GOWDA AGED ABOUT 56 YEARS 1(b) ASHOKA S/O LATE RAME GOWDA AGED ABOUT 40 YEARS 1(c) SUNITHA D/O LATE RAME GOWDA AGED ABOUT 36 YEARS ALL ARE R/AT HULIKERE VILLAGE BELAGOLA, SRIRANGAPATNA TALUK, MANDYA DISTRICT. … APPLICANTS (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-G PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
IN C.A.No.189/2019 IN C.O.P.No.112/1994: BETWEEN:
1 . VISHAKANTA SINCE DEAD BY HIS LRS 1(a) PREMA W/O LATE VISHAKANTA, AGED ABOUT 48 YEARS 1(b) RAVIKUMAR S/O LATE VISHAKANTA, AGED ABOUT 32 YEARS 1(b) CHANDRA S/O LATE VISHAKANTA, AGED ABOUT 29 YEARS ALL ARE R/AT BELAGOLA SRIRANGAPATNA TALUK, MANDYA DISTRICT. … APPLICANTS (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-G PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
IN C.A.No.191/2019 IN C.O.P.No.112/1994: BETWEEN:
GOVINDARAJU S/O LATE VENKATEGOWDA AGED ABOUT 54 YEARS R/AT NEAR PATALAMMA TEMPLE, DODDABEEDI, BELAGOLA, SRIRANGAPATNA TALUK, MANDYA DISTRICT-571606 … APPLICANT (BY SRI K.VISHNU KUMAR, ADV.) AND:
MANDYA NATIONAL PAPER MILLS LTD. (IN LIQUIDATION) REP BY OFFICIAL LIQUIDATOR, NO.26-27, 12TH FLOOR, RAHEZA TOWERS, M.G. ROAD, BENGALURU-560 001. …RESPONDENT (BY SRI JAGADEESH GOUD PATIL, ADV.) THIS COMPANY APPLICATION IS FILED UNDER RULE 164 R/W RULE 9 COMPANY’S COURT RULES 1959, PRAYING TO SET ASIDE THE ORDER DATED 03.06.2019 AT ANNEXURE-E PASSED BY RESPONDENT AND TO DIRECT THE RESPONDENT TO PAY VOLUNTARY SEPRARATION SCHEME BENEFITS AND WAGES PAR WITH REGULAR MAZDOORS FROM 10.09.1985 TO 20.10.2000 ALONG WITH INTEREST AS APPLICABLE.
THESE COMPANY APPLICATIONS COMING ON FOR ORDERS THIS DAY, THE COURT MADE THE FOLLOWING:
COMMON ORDER Since common and akin issues are involved in these matters, the same are clubbed, heard and disposed of by this common order.
2. Marshalling of the facts is necessary for the better understanding of the case. The applicants are the legal representatives of the workmen/workmen who joined the services of Mandya National Paper Mills (in liquidation) as casual labourers. It is contended that though the workmen were designated as casual labourers, during their tenure of 23 years they had worked like regular mazdoors in all areas like paper machine, chemical department, boiler maintenance, rewinding paper roll, pulp mills, soda recovery and in finishing and dispatch.
3. In the year 1985, the union raised an industrial dispute in I.D.No.22/1985 seeking relief of equal pay for equal work for the casual labourers, the industrial Tribunal Bangalore after adjudication passed an award holding that union is justified in seeking for equal pay for casual labourer on par with the regular mazdoors from 10.9.1985 to 20.10.2000, the casual labourers approached the management for regularization whereas the management sought approval under Section 33(2)(b) of the Industrial Disputes Act, 1947 (‘I.D. Act’ for short) for the termination of the applicants/workmen which came to be dismissed by the Industrial Tribunal, Mysore on 31.10.1996 directing the management to reinstate the workmen with backwages. The management preferred writ petition Nos.1269 and 6471 to 6480/1997 before this court. The said batch of writ petitions were dismissed against which Writ Appeal Nos.1822- 1832/1998 were preferred by the management and the same came to be dismissed. Further, the special leave petitions filed by the management before the Hon’ble Apex Court also came to be dismissed, as a result the management reinstated the applicants and paid backwages for the period from 20.11.1990 to 31.3.1999. The Management issued a Circular dated 6.8.2000 inviting applications from employees for voluntary separation scheme (VSS) benefits. It is contended that the applicants though were assured that VSS benefits would be paid, but were terminated from service denying the said benefits; the applicants accepted the termination order with retrenchment compensation by reserving their right to approach the appropriate forum. In the meantime, on 20.10.2000, a winding up order was passed by this court.
4. On 1.12.2000, the applicants raised an industrial dispute before the Labour Officer, Mandya, for the relief of employment in any other Central Government industry and to settle the arrears towards the VSS benefits. However, the conciliation proceedings ended in failure.
5. In the year 2003, the official liquidator called for claims from debtors. Hence the applicants had filed affidavits before the official liquidator seeking relief of equal pay for equal work and voluntary separation scheme benefits. The official liquidator while adjudicating the dispute in the year 2007, dismissed the claim affidavits in view of the reference application pending before the Labour Court, Mysore for adjudication. An Industrial dispute was raised by the Government of Karnataka in Reference No.5/2009 for adjudication under Section 10(1)(c) of the I.D. Act. In the said Reference, the official liquidator was impleaded. The labour court rejected the reference No.5/2009 directing the applicants to approach the official liquidator to prove their debts against the company under Sections 528-530 of the Companies Act, 1956. The applicants had filed a miscellaneous petition No.27 of 2015 seeking for correction of the error in the final award dated 14.11.2014. The said miscellaneous petition was dismissed on 19.06.2018, pursuant to which the applicants had approached the official liquidator by filing a representation seeking for the benefits under the voluntary separation scheme and arrears of wages for the period from 10.09.1985 upto 20.10.2000, the official liquidator has rejected the representation submitted by the applicants. Hence, these applications.
6. Learned counsel Sri.Vishnu Kumar appearing for the applicants would vehemently contend that the official liquidator while passing the order on 10.04.2013 had reserved liberty to the applicants to file the claim as and when the Labour Court decides the issue pending before it. In view of the same, the official liquidator ought not to have rejected the claim of the applicants mainly on the ground that the applicants had not questioned the payment of wages and other benefits during the company’s life time. The applicants are entitled to the benefits of voluntary service scheme on par with the other regular mazdoors of the company (in liquidation) from 10.09.1985 and the same requires to be considered.
7. Learned counsel Sri.Jagadish Goud Patil for the Official Liquidator submitted that the applicants/workmen had settled the eligible benefits under the voluntary service scheme on 20.09.2000, no rights of the applicants/workmen were reserved to approach the appropriate forum. Since the workmen had accepted the terminal benefits paid by the company (in liquidation) on 20.09.2000 and accordingly consented for termination from their services, the claim made by the applicants at this stage cannot be considered.
8. I have carefully considered the rival submissions made by the learned counsel appearing for the parties and perused the material on record.
9. It is not in dispute that the order dated 20.09.2000 depicts the statement showing the details of salary and terminal benefits of the applicants. Though the same appears to have accepted by the applicants, conciliation proceedings were initiated before the Industrial Tribunal but in vain.
10. The order of winding up was passed by this Court on 20.10.2000 subsequent to which the applicants had approached the Labour Court in reference No.5 of 2009 sans the leave of this court under Section 446(1) of the Companies Act, 1956. The issues framed by the labour court are as under:
1. Whether the first party workmen prove that they have been illegally terminated from service by the Second Party on 13.09.2000 as contended?
2. Whether the First Party Workmen prove that there exists a relationship as Employer and workmen between themselves and the second party?
3. The Reference is bad for mis-joinder of parties?
4. Whether the First Party Workmen are entitled to the reliefs as claimed?
5. What Order or Award?
11. Issue Nos.1, 2 and 4 are answered in the negative. Whereas issue No.3 is answered in the affirmative. The labour court has categorically observed that the workmen failed to prove that they have been illegally refused employment by the Management of Mandya National Paper Mills Ltd., and they cannot proceed without taking leave from the winding up Court under Section 446(1) of the Companies Act, 1965.
12. The reasoning of the Official Liquidator that the workmen had not questioned the payment of wages and other benefits paid against the termination order dated 20.09.2000 during the life time of the company and indeed had accepted the settlement without reserving liberty to approach the appropriate Forum, as such, considering the claim of the workmen at this stage would not arise cannot be set at naught in view of the findings of the Labour Court made in reference No.5 of 2009 and Miscellaneous Petition No.27 of 2015.
13. Division Bench of this Court in the case of Basavaiah and others vs. Sri. Krishnarajendra Mills Ltd., reported in Company Cases Volume - 106 Page 366 has held that even if the proceedings under Section 33C(2) of the Industrial Disputes Act, 1947 had been initiated prior to the order of winding up, as the order of winding was passed during the pendency of such proceedings, it was mandatory for the applicants (workmen) to have obtained the leave of the company court under Section 446(1) of the Companies Act, 1956. A statutory mandate cannot be avoided on the ground of ignorance or hardship. However, it is held that proceedings under Section 33C(2) are basically different from an industrial dispute referred under section 10(1)(c) of the Act. Leave was granted under Section 446(1) to proceed with, in the circumstances of the case. The order of the labour court is not impugned in these applications.
14. Hence, the applications stand dismissed with liberty to the applicants to seek redressal of their grievance in accordance with law, if so advised.
The claim amount of the applicants may be reserved with the Official Liquidator for a period of one year.
Sd/- JUDGE NC/PMR