[1.0] Present OJ Appeal has been preferred by the appellant herein – original applicant challenging the impugned order passed by the learned single Judge/Company Court in OLR No.86 of 2008 by which the learned Company Court has held that the claim submitted by the applicant herein on the basis of the judgment and award dated 24.09.2004 passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court as not admissible while making the payment to the applicant and as such declaring the judgment and award passed by the Labour Court confirmed by the Industrial Court as null and void and non est. [2.0] Facts leading to the present OJ Appeal in nutshell are as under:
[2.1] That New Swadeshi Mills (Unit of GSTC Limited) was ordered to be wound up. Official Liquidator was appointed as Liquidator of the said Company. It appears that prior to the order of winding up of the company, the applicant preferred application under Section 78/79 of the BIR Act being T. Application No.44 of 1996 before the Labour Court, Ahmedabad for an appropriate order to treat his date of appointment as 27.06.1975. That thereafter the aforesaid Company came to be ordered to be wound up and hence, the applicant submitted the Company Application No.337 of 1997 before the learned Company Court seeking permission to proceed further with the said application and the learned Company Court granted the permission to the applicant to proceed further with the said application. That the OL was also joined as a party to the said application. It appears that the petitioner resigned on 11.09.1996 as per the Voluntary Retirement Scheme floated by the Mill Company and the Mill Company gave discharge order dated 22.10.1996 and paid Rs.76,000/ treating the petitioner as Badli worker. That the appellant herein accepted the same with objection and subject to the final decision in aforesaid application No.44 of 1996. That thereafter the Labour Court, Ahmedabad by judgment and award dated 24.09.2004 allowed the said application declaring the date of initial appointment of the applicant as 27.06.1975. That the OL challenged the judgment and order passed by the learned Labour Court, Ahmedabad in T. Application No.44 of 1996 before the Industrial Court being Appeal (IC) No.9 of 2005 and the Industrial Court rejected the said Appeal (IC) No.9 of 2005 by judgment and order dated 21.10.2005. It appears that thereafter the appellant herein submitted Company Application No.98 of 2006 before the learned Company Court for appropriate order directing the OL to implement the aforesaid orders and claimed Rs.1,37,575 as difference in compensation and other benefits as per the Voluntary Retirement Scheme as given to his coworker Mangalram Ram Kumar. That by order dated 28.11.2006, this Court disposed of the aforesaid application directing the OL to send the case of the applicant to the Chartered Accountant for verification and adjudication of the claim of the applicant and thereafter on the basis of the report of the Chartered Accountant, the OL to adjudicate the claim of the applicant. It appears that thereafter the claim of the appellant herein came to be verified and/or adjudicated upon by the Chartered Accountant and as per the report of the Chartered Accountant dated 22.12.2007, the Chartered Accountant opined that there was settlement between the GSTC and TLA which was endorsed by Division Bench of this Court and the claim of the appellant is not in conformity with the consent order passed by the Division Bench. The Chartered Accountant also further submitted in the report that appellant has suppressed the earlier proceedings of Application No.3372 of 1982 filed before the Labour Court. He also opined that since the claim is not in conformity with the order passed by the Division Bench and there was suppression of material fact, the said facts be brought to the notice of this Court. Therefore, the OL submitted the OLR No.86 of 2008 before the learned Company Court seeking direction of the learned Company Court on the aspect as to whether the appellant workman would be entitled to any amount in view of the report of the Chartered Accountant or not. That relying upon the earlier decision of the learned Company Court in Company Application No.158 of 2007 by which the learned Company Court in similar set of facts and circumstances set aside the judgment and award passed by the Labour Court which was found to be contrary to the judgment delivered by the Division Bench, the learned Company Court has held that the claim of the appellant is found to be not sustainable and non est at law.
[2.2] Feeling aggrieved and dissatisfied with the impugned order dated 10.09.2009 passed by the learned Company Court in OLR No.86 of 2008 by which the claim made by the appellant herein on the basis of the judgment and award passed by the Labour Court confirmed by the Industrial Court, is held to be not sustainable and non est, the appellant herein – workman has preferred the present OJ Appeal.
[3.0] Shri Paresh Mehta, learned advocate appearing on behalf of the appellant has vehemently submitted that the learned Company Court has materially erred in holding the claim of the appellant which was on the basis of the judgment and award passed by the learned Court confirmed by the Industrial Court, as not sustainable and non est. It is submitted by Shri Mehta, learned advocate appearing on behalf of the appellant that as such the judgment and order passed by the Labour Court and confirmed by the Industrial Court has attained the finality and the OL has not challenged the same before the higher forum. Therefore, it was not open for either the Chartered Accountant and/or OL and/or even the Company Court to declare the order passed by the Labour Court confirmed by the Industrial Court as non est that too in a collateral proceedings.
[3.1] It is submitted that as such the Chartered Accountant and OL were bound to implement the order passed by the Labour Court confirmed by the Industrial Court to which even the OL was also a party to the said proceedings.
[3.2] It is further submitted by Shri Mehta, learned advocate appearing on behalf of the appellant that by no stretch of imagination it can be said that the order passed by the Labour Court confirmed by the Industrial Court is non est. It is submitted that admittedly the Labour Court did have jurisdiction to entertain the application submitted by the appellant which was submitted under Section 78/79 of the BIR Act and therefore, it cannot be said that the Labour Court who passed the order in T. Application No.44 of 1996 was lacking total/absolute jurisdiction.
[3.3] It is further submitted by Shri Mehta, learned advocate appearing on behalf of the appellant that even as held by the Hon’ble Supreme Court in the case of M. Meenakshi vs. Metadin Agarwal reported in (2006)7 SCC 470, even a void order is required to be set aside by a competent Court of law. It is submitted that a void order is necessarily not non est. It is submitted that as held by the Hon’ble Supreme Court in the aforesaid decision unless it is found that the order passed by the authority is found to be wholly without jurisdiction, they are not nullities. He has also relied upon the decision of the Hon’ble Supreme Court in the case of Sultan Sadik vs. Sanjay Raj Subba reported in (2004)2 SCC 377 by submitting that as held by the Hon’ble Supreme Court in the said decision, an invalid order necessarily need not be non est; in a given situation it has to be declared as such. Relying upon the decision of the Hon’ble Supreme Court in the case of State of Kerala vs. M.K. Kunhikannan Nambiar Manjeri Manikoth Naduvil reported in (1996)1 SCC 435, it is submitted that as observed by the Hon’ble Supreme Court in the said decision, even a void order does not become non est where infirmity is not of fundamental nature and in such case it remains effective inter partes until successfully avoided in higher forum.
Making above submissions and relying upon above decisions, it is requested to allow the present Appeal and direct the OL to consider the claim of the appellant on the basis of the judgment and order dated 24.09.2004 passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court as admissible for all purposes and to make the balance payment to the appellant accordingly.
[4.0] Present Appeal is opposed by Shri Nagarkar, learned advocate appearing on behalf of respondent No.2 as well as Shri Yadav, learned advocate appearing on behalf of Official Liquidator of the company in liquidation. Shri Nagarkar, learned advocate appearing on behalf of respondent No.2 has vehemently submitted that the learned Company Court has not committed any error and/or illegality in passing the impugned order and as such declaring the order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court on the basis of which the appellant submitted the claim, as non est. It is submitted that as such the order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the learned Industrial Court was just contrary to the settlement entered into between GSTC and TLA which was approved by the Division Bench of this Court and therefore, relying upon the earlier decision of the learned Company Court – coordinate Bench of this Court in Company Application No.158 of 2007 in which in similar set of facts and circumstances the award declared by the Labour Court was declared as non est, no illegality has been committed by the learned Company Court by passing the impugned order. Shri Nagarkar, learned advocate appearing on behalf of the respondent No.2 has heavily relied upon the decision of the Calcutta High Court in the case of Suresh Chandra Bose vs. The State of West Bengal reported in AIR 1976 Calcutta 110 by submitting that as observed by the Calcutta High Court in the said decision, a thing which is void is non est and it is not necessary to set that aside though it is sometimes convenient to do so. Relying upon the aforesaid decision it is submitted by Shri Nagarkar, learned advocate appearing on behalf of respondent No.2 that though the order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court has not been challenged by the OL and/or respondent No.2 before the higher forum still in other collateral proceedings, the same can be challenged and/or declared non est.
Making above submissions and relying upon above decisions, it is requested to dismiss the present Appeal.
[5.0] Heard learned advocates appearing on behalf of respective parties at length. At the outset it is required to be noted that as such the appellant herein submitted the T. Application before the Labour Court under Section 78/79 of the BIR Act for declaring the action of the company in treating his date of appointment in the company as 23.02.1979 as illegal and for a declaration that his actual date of entry in the company is 27.06.1975. It is also required to be noted at this stage that the said application was submitted much prior to the company was ordered to be wound up by this Court. Not only that, but thereafter the appellant submitted the application before the Company Court seeking permission to proceed further with the said application and the permission was granted by the learned Company Court and even the OL of the company in liquidation was also joined as party to the said application. That thereafter the learned Labour Court allowed the said application declaring the action of the company in treating 23.02.1979 as his initial date of appointment as illegal and consequently declaring that his actual date of appointment in the company is 27.06.1975. It is to be noted that the order passed by the Labour Court in T. Application No.44 of 1996 was challenged by way of Appeal by the OL before the Industrial Court and the Industrial Court has dismissed the said Appeal confirming the order passed by the Labour Court, Ahmedabad in T. Application No.44 of 1996. It is required to be noted that thereafter neither the OL nor respondent No.2 has challenged the said orders before the higher forum and the order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court have become final and have attained finality between the inter se parties. That thereafter appellant submitted the claim before the OL claiming the amount on the basis of the judgment and order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court and pursuant to the order passed by this Court, the claim of the appellant was sent to Chartered Accountant and the Chartered Accountant held the claim of the appellant as inadmissible as the same was found to be contrary to the settlement entered into between TLA and GSTC which was approved by the Division Bench and also on the ground that there was a suppression of material fact by the appellant before the Labour Court. That thereafter the OL submitted the report before the learned Company Court seeking direction with respect to the claim of the appellant and relying upon the decision of the coordinate Bench/learned Company Court in another case – Company Application No.158 of 2007, the learned Company Court by impugned order has held the claim of the appellant on the basis of the judgment and order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court as inadmissible and non est. Being aggrieved and dissatisfied with the impugned order passed by the learned Company Court, the appellant herein has preferred the present OJ Appeal.
Therefore, the short question which is posed for consideration of this Court is whether in a collateral proceeding the learned Company Court was justified in declaring the judgment and order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court as non est?
[5.1] At the outset it is required to be noted that as such it is not the case on behalf of the OL and/or even respondent No.2 that the Labour Court, Ahmedabad who passed the judgment and order in T. Application No.44 of 1996 was lacking total/absolute jurisdiction in entertaining the T. Application and passing the order. Therefore, as such the Labour Court, Ahmedabad had jurisdiction to entertain the said application and pass the order. Therefore, it cannot be said that the Labour Court, Ahmedabad who passed the order in T. Application No.44 of 1996 was lacking absolute jurisdiction. Under the circumstances, as such the order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court cannot be said to be non est. As stated herein above, as such the order passed by the Labour Court confirmed by the Industrial Court has attained the finality between the inter se parties. Under the circumstances, as such the learned Company Court has materially erred in declaring the order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court as non est.
[5.2] As held by the Hon’ble Supreme Court in the case of Sultan Sadik (Supra), even an invalid order necessarily need not be non est and in a given situation it has to be declared as such.
[5.3] As held by the Hon’ble Supreme Court in the case of M. Meenakshi (Supra), even a void order is required to be set aside by a competent Court of law. It is further observed that a void order is necessarily not non est and an order cannot be declared to be void in a collateral proceeding. It is further observed that the orders passed by the authorities, if are not found to be wholly without jurisdiction, they are no nullities.
[5.4] In the case of Deepak Agro Foods vs. State of Rajasthan reported in (2008)7 SCC 748, the Hon’ble Supreme Court has explained the difference between irregular, wrong or illegal order. It is held that the difference depends on whether or not the authority passing the order had jurisdiction. It is observed that order passed without jurisdiction renders the order void ab initio because absence of jurisdiction goes to the root of the matter. It is further held that such a defect is not curable at all. It is further held and observed that however, an order passed in a wrongful manner by an authority having jurisdiction is not a nullity but an irregularity or illegality.
[5.5] Considering the aforesaid decisions and the facts of the case on hand and as observed hereinabove, the order passed by the Labour Court in T. Application No.44 of 1996 confirmed by the Industrial Court cannot be said to be wholly without jurisdiction and therefore, the same cannot be said to be non est and therefore, the learned Company Court has materially erred in declaring the order passed by the Labour Court, Ahmedabad in T. Application No.44 of 1996 confirmed by the Industrial Court as non est. Consequently, the learned Company Court has materially erred in holding the claim of the appellant on the basis of the judgment and order passed by the Labour Court, Ahmedabad in T. Application confirmed by the Industrial Court as not admissible that too in a collateral proceeding.
[5.6] Now, so far as the decision of the Calcutta High Court relied upon by Shri Nagarkar, learned advocate appearing on behalf of respondent No.2 is concerned, in view of the aforesaid decisions of the Hon’ble Supreme Court, the same shall not be of any assistance to respondent No.2. Even otherwise, as observed hereinabove, it cannot be said that the Labour Court, Ahmedabad had no jurisdiction at all to entertain the T. Application and decide and dispose of the same. Under the circumstances, the order passed by the Labour Court, Ahmedabad in T. Application No.44 of 1996 confirmed by the Industrial Court cannot be declared as non est and that too in a collateral proceeding.
[6.0] In view of the above and for the reasons stated above, the impugned order passed by the learned Company Court holding the claim of the appellant on the basis of the judgment and order passed by the Labour Court, Ahmedabad in T. Application No.44 of 1996 confirmed by the Industrial Court as inadmissible and non est, deserves to be quashed and set aside and is, accordingly, quashed and set aside and the Official Liquidator of the company in liquidation is hereby directed to consider the claim of the appellant on the basis of the judgment and order passed by the Labour Court, Ahmedabad in T. Application No.44 of 1996 confirmed by the Industrial Court as admissible for all purposes and consequently to make the payment to the appellant at par with other workmen and to make the actual payment at the earliest but not later than two months from today.
Present OJ Appeal is, accordingly, allowed. However, in the facts and circumstances of the case, there shall be no order as to cost.
(M.R.SHAH, J.) Ajay (S.H.VORA, J.)