IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 22ND DAY OF MARCH, 2019 BEFORE THE HON' BLE MR.JUSTICE R DEVDAS WRIT PETITION NOs.39962 OF 2014 & 44100 OF 2014(L-RES) C/W WRIT PETITION NO.13226 OF 2015(L-RES) IN W.P. NOS.39962/2014 & 44100/2014 BETWEEN WORKMEN OF M/S HIMALAYA DRUG COMPANY LIMITED MAKALI, BANGALORE NORTH TALUK REP. BY KARNATAKA WORKERS UNION (A REGISTERED TRADE UNION UNDER THE INDIAN TRADE UNIONS ACT) REPRESENTED BY ITS GENERAL SECRETARY C I T U OFFICE-NO.20/1 LALBAGH FORT ROAD BANGALORE-560004 (BY SRI SUBBA RAO, SENIOR COUNSEL FOR SRI KUTTAPPA B D, ADVOCATE) AND M/S HIMALAYA DRUG COMPANY LIMITED REP. BY ITS CHAIRMAN & MANAGING DIRECTOR MAKALI, BANGALORE NORTH TALUK BANGALORE-562123 ... PETITIONER (BY SRI S N MURTHY, SENIOR COUNSEL FOR M/S. S N MURTHY ASSTS, ADVOCATES) ... RESPONDENT THESE WRIT PETITIONS ARE FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER DTD 9.10.2013 ON I.A.NO.I IN REF NO.2/2013 ON THE FILE OF PRINCIPAL LABOUR COURT, BANGALORE MARKED AT 'H'; ORDER DTD. 5.12.2013 MADE ON I.A.NO.IV IN REF.NO.2/2013 ON THE FILE OF PRINCIPAL LABOUR COURT, BANGALORE MARKED AT ‘J’ AS BOTH THESE ORDERS ARE ILLEGAL AND THE SAID ORDERS HAVE BEEN PASSED IN EXCESS OF THE JURISDICTION VESTED IN THE LABOUR COURT AND ALSO THE SAID ORDERS ARE AGAINST THE PRINCIPLES OF INDUSTRIAL ADJUDICATION AND SOCIAL JUSTICE AND PART III AND PART IV OF THE CONSTITUTION OF INDIA AND ETC.
IN W.P. NO.13226/2015 BETWEEN WORKMEN OF M/S HIMALAYA DRUG COMPANY LIMITED, MAKALI, BANGALORE NORTH TALUK, REP. BY KARNATAKA WORKERS UNION, (A REGISTERED TRADE UNION UNDER THE INDIAN TRADE UNIONS ACT) REPRESENTED BY ITS GENERAL SECRETARY, C I T U OFFICE- NO.20/1, LALBAGH FORT ROAD, BANGALROE-560 004.
(BY SRI SUBBA RAO, SENIOR COUNSEL FOR SRI KUTTAPPA B D, ADVOCATE) AND M/S HIMALAYA DRUG COMPANY LIMITED REP. BY ITS CHAIRMAN AND MANAGING DIRECTOR, ... PETITIONER MAKALI, BANGALORE NORTH TALUK, BANGALORE-562 123.
(BY SRI S N MURTHY, SENIOR COUNSEL FOR SRI SOMASHEKAR, ADVOCATE) ... RESPONDENT THIS WRIT PETITION IS FILED UNDER ARTICLES 226 & 227 OF THE CONSTITUTION OF INDIA PRAYING TO QUASH THE ORDER ANNX-H DT.29.1.2015 ON I.A.NO.1 IN REF. NO.1/2013 ON THE FILE OF PRINCIPAL LABOUR COURT, BANGALORE AND ETC.
THESE WRIT PETITIONS COMING ON FOR PRELIMINARY HEARING IN ‘B’ GROUP THIS DAY, THE COURT MADE THE FOLLOWING:
COMMON ORDER The petitioners in both the matters have raised common question of law, facts being identical and the respondent being common, these matters are heard and disposed of by this common order.
2. The petitioner-Union is before this Court calling in question the order passed by the Principal Labour Court, Bangalore, dated 09.10.2013 on I.A.No.I, in Reference No.2/2013 in W.P.No.39962/2014 and the order dated 29.01.2015 on I.A.No.I in Ref. No.1/2013 in W.P.No.13226/2015.
3. A brief background of the dispute is necessary. The respondent-Company is in the business of manufacturing Ayurvedic drugs and cosmetic products. The Company which started with 100 workmen, had about 2000 workmen by the end of 2010. It is the case of the respondent-Company that due to increase in competition and abnormally high operating costs, the Company was compelled to reduce its manufacturing costs. The Company therefore, made efforts to improve its products by reducing the wage cost, by adopting new technology for its standard operating process. In the process, the Company announced Voluntary retirement Scheme (hereinafter referred to as ‘VRS’ for short) on 24.11.2008 with an offer of Rs.6,00,000/- as Voluntary retirement amount, apart from other legal dues. Though negotiations went on between the Company and the Union of workmen, there were no takers for the VRS. Thereafter, the Company enhanced the lumpsum voluntary retirement amount from Rs.6,00,000/- to Rs.7,00,000/-. Many of the workmen submitted their applications under the VRS offered by the Company. About 93 workmen submitted applications and resignations under the Voluntary Retirement Scheme. The applications were made on various dates from 31.12.2008 to 30.01.2009 and the applications were accepted by the respondent-Company on various dates. The benefit under the VRS was received by the workmen and the workmen were thereafter relieved from service. The workmen entered into individual settlements under Section 18(1) of the Industrial Disputes Act, 1947. It is an admitted fact that the 93 workmen have received the benefit under the VRS scheme, having encashed the cheques in that regard.
4. After having received the benefit of the ‘VRS’ scheme in the year 2008-2009, eighty nine workmen raised a dispute before the State Government on the ground that the workmen were forcibly terminated under the guise of ‘VRS’. The State Government referred the dispute to the Labour Court, which is registered as Ref. Nos.1/2013 and 2/2013.
5. The respondent-Management having filed its counter statement denying the allegation made by the workmen/Union, further filed I.A.No.I under Sections 11(1) and (3) of I.D.Act, seeking a direction to the first party- workmen to deposit the amount taken under voluntary retirement scheme dated 24.11.2008 within seven days from the date of filing the application, in view of the judgment of the Hon’ble Supreme Court in the case of Man Singh Vs. Maruti Suzuki India Ltd. and Another reported in (2011) 14 SCC 662. By the impugned orders dated 09.10.2013 and 29.01.2015, the Labour Court allowed I.A.No.I and directed the first party-workmen to deposit the amount taken under ‘VRS’ within 40 days from the date of the order, failing which the reference would stand rejected. The first party-workmen are before this Court calling in question the impugned orders dated 09.10.2013 and 29.01.2015.
6. Sri Subba Rao, learned Senior Counsel appearing for the workmen submitted that in the case of Man Singh (supra) it was not held that pre-deposit was mandatory. It was submitted that the Writ Court of Punjab and Haryana was considering the question, “whether the termination of service of Sri Man Singh on the basis of VRS scheme by the Management was justified and correct, if not, to what relief is he entitled?” When the respondent-Company challenged the competence and validity of the reference, contended that the workman should not be allowed to proceed while he retained all the monetary benefits collected by him under the scheme. The writ Court upheld the contention of the respondent- Company and while disposing of the writ petition, it directed the workman to deposit the amount which he received, before the Labour Court, along with interest from the date when he received the amount, within a period of 60 days, as a condition to allow the Labour Court to proceed with the matter. In the intra-Court appeal, the Division Bench upheld the directions issued by the writ Court. The Hon’ble Supreme Court upheld the directions issued by the Writ Court, however modifying the order to the extent of payment of interest.
7. The learned Senior Counsel further placed reliance on a decision of the Bombay High Court in the case of Saint Gobain Sekurit India Ltd., Vs. Kuyesh Durjan Yadav and Others reported in 2015 SCC OnLine Bombay 6777 [2016 (2) LLJ 54]. Learned Senior Counsel submitted that the High Court of Bombay framed the question as to whether it was mandatory for the Court entertaining a complaint/proceedings on behalf of the workmen calling in question the Voluntary Retirement Scheme of which they have availed some benefits, to direct the deposit of the amount received by the workmen as a condition precedent for entertaining the proceedings.
8. Having framed the above question, the High Court of Bombay proceeded to hold that such direction cannot be automatic and without application of mind. It was held that such power to direct predeposit exists, but from the existence of this power, a sequator does not automatically follow that it is a mandatory precondition.
9. The decision of the Apex Court in the case of Mardia Chemicals Ltd. and others vs. Union of India and others reported in (2004) 4 SCC 311 was also pressed into service.
10. Per contra, Sri S.N.Murthy, learned Senior Counsel, appearing for the respondent-Management submitted that the Hon’ble Supreme Court, while deciding Man Singh (supra) had noticed the decision in Ramesh Chandra Sankla Vs. Vikram Cement, reported in (2008) 14 SCC 58. In Ramesh Chandra Sankla, a Division Bench of the High Court of Madhya Pradesh was of the view that it would be equitable to direct the employees concerned to return the benefits so received to the employer subject to the undertaking by the Company that in the event the Labour Court allowed the claim and granted benefits to the workmen, the same would be restored to them by the Company with interest at 6% per annum. When the workmen took up the matter before the Apex Court, Their Lordships held, “100. Even otherwise, according to the workmen, they were compelled to accept the amount and they received such amount under coercion and duress. In our considered opinion, they cannot retain the benefit if they want to prosecute claim petitions instituted by them with the Labour Court. Hence, the order passed by the Division Bench of the High Court as to refund of amount cannot be termed unjust, inequitable or improper. Hence, even if it is held that a ‘technical’ contention raised by the workmen has some force, this Court which again exercises discretionary and equitable jurisdiction under Article 136 of the Constitution, will not interfere with the direction which is in consonance with the doctrine of equity. It has been rightly said that a person ‘who seeks equity must do equity’. Here the workmen claim benefits as workmen of the Company, but they do not want to part with the benefit they have received towards retirement and severance of relationship of master and servant. It simply cannot be permitted. In our judgment, therefore, the final direction issued by the Division Bench needs no interference, particularly when the Company has also approached this Court under Article 136 of the Constitution.
101. For the foregoing reasons, in our opinion, the order passed by the Division Bench of the High Court deserves to be confirmed and is hereby confirmed. The payment which is required to be made as per the said order should be made by the applicants intending to prosecute their claims before the Labour Court, Mandsour. In view of the fact, however, that the said period is by now over, ends of justice would be served if we extend the time so as to enable the applicants to refund the amount. We, therefore, extend the time up to 31-12-2008 to make such payment. We may, however, clarify that the claim petitions will not be proceeded with till such payment is made. If the payment is not made within the period stipulated above, the claim petitions of those applicants will automatically stand dismissed. The Labour Court will take up the claim petitions after 31-12-2008."
11. Moreover, it is submitted that these petitions do not survive for consideration since the dispute in Ref. Nos.2/2013 and 1/2013 stands dismissed since there was non- compliance of the impugned order.
12. For this submission, the learned Senior Counsel for the workmen submitted that the decision in these writ petitions will revive the dispute before the Labour Court, if the petitions are allowed.
13. Heard the learned Senior Counsels for the petitioner and respondent and perused the writ papers.
14. The challenge to order of pre-deposit while the workmen seek to call in question termination of service in the guise of ‘VRS’ has not met with approval at the hands of the Hon’ble Supreme Court of India. In Ramesh Chandra Sankla and Man Singh, the Apex Court has upheld the directions issued by the High Courts requiring the workmen to deposit the benefit received under the VRS scheme, as a pre-condition to hear the dispute raised by the workmen. The issue raised and answered by the Hon’ble Supreme Court in both these matters applies to the case on hand, on all fours.
15. In the case of Saint Gobain Sekurit India Ltd. (supra), the High Court of Bombay, though held that there is no statutory provision mandating such pre-condition, proceeded to observe that whether such a direction is justified or otherwise, would depend on facts of each case and various parameters would therefore come in play. In a given case, if the Court finds that such direction is not equitable, it is not precluded from refusing to order predeposit. Therefore, without there being any application of mind to the facts of the case and without considering the equities of the matter, straightway, a direction to deposit the entire amount as a mandatory precondition, cannot be passed.
16. It is seen from the impugned orders that the Labour Court has dealt with the application, arguments and the decisions cited by the learned Counsels. The Labour Court has also kept in mind the observations of the Apex Court regarding deposit along with interest and therefore, directed deposit of the amount received under VRS but not the interest.
17. It is also beneficial to notice that some of the workmen had earlier approached this Court in W.P.Nos.48682-48691/2014 questioning similar order passed by the Labour Court on an interlocutory application made by the respondent-Company herein. A co-ordinate Bench, by order dated 28.02.2018 dismissed the petition filed by the workmen, while directing the workmen to deposit the said amount within a period of 90 days, if they wish to prosecute the case before the Labour Court.
18. In the light of the above, these petitions fail and are accordingly dismissed. No order as to costs.
SD/- JUDGE JT/-