TMI Blog2005 (1) TMI 671X X X X Extracts X X X X X X X X Extracts X X X X ..... udge dated 19.4.1995 passed in C.W.P. No.15728 of 1993 questioning an Award dated 28.7.1993 passed by the Labour Court in Reference Nos. 437, 438 and 166 of 1988, was set aside. BACKGROUND FACTS: The Respondents herein who are three in number were appointed by Maruti Limited as Electrician, Helper and Assistant Fitter with effect from 27.4.1974, 8.11.1973 and 8.4.1974 respectively. Their services stood terminated by the said company on or about 25/26.8.1977 as a result of closure of the factory. The said company came to be wound up in terms of an order dated 6.3.1978 passed by the High Court of Punjab and Haryana in Company Petition No.126 of 1977 titled Delhi Automobiles P. Ltd. vs. Maruti Ltd. whereupon an Official Liquidator was appointed to take charge of the assets thereof. A formal winding up order was also drawn up in terms of Form No.52 of the Company (Court) Rules, 1959. The company was formally wound up on 6.3.1978 whereupon it ceased to have any business activity. It is borne out from records that the learned Company Judge in the said proceedings by an order dated 5.8.1977 directed the company that in view of the fact that the industrial establishment of the compan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s entitled for reemployment, if yes, with what details ? (2) Whether Shri Ghinak Prasad is entitled for reemploymenbt, if yes, with what details, with what details ? (3) Whether Shri Sampath Prasad is entitled for reemployment, if yes, with what details ? In its Award dated 28.7.1993, the Labour Court upon holding that the Appellant herein is the successor-in-interest of the said company opined that it was liable to reemploy the Respondents with back-wages from the date of submitting their respective demand notices. WRIT PROCEEDINGS: The Appellant herein filed a writ petition before the Punjab Haryana High Court questioning the said Award and the same was allowed by a learned Single Judge of the said court by a judgment and order dated 19.4.1995 holding : (i) workmen-Respondents retrenched by the company in August 1977 and did not challenge retrenchment. The company, thereafter, went into liquidation and its undertakings came to vest in the Petitioner under Acquisition Act, but liabilities of the company were never taken over,. (ii) Petitioner cannot be said to be successor-ininterest of the company and become liable to offer reemployment to the workmen in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of retrenchment contained in Section 2(oo) thereof. Drawing our attention to the provisions of the said Act and in particular Section 3, 4, 5, 13 and 25 thereof, the learned counsel would, lastly, contend that the Act being a self-contained Code in terms whereof the liability of the company had not been taken over and as the same contains a non-obstante clause, the provisions thereof would prevail over the 1947 Act. Mr. Anupal Lal Das, learned counsel appearing on behalf of the Respondents, on the other hand, would contend that in view of the decision of this Court in Anakaplla Co-operative Agricultural and Industrial Society Limited vs. Workmen [(1963) Supp. 1 SCR 730], the Appellant is the successor-in-interest of the business of the said company. The learned counsel would submit that the concurrent findings of fact having been arrived at in this regard by the Labour Court as well as the Division Bench of the High Court, this court should not interfere therewith. Placing reliance on the decision of this Court in Workmen represented by Akhil Bhartiya Koyla Kamgar Union vs. Employers in relation to the Management of Industry Colliery of Bharat Coking Coal Ltd. and Others ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave been withdrawn. (4) For the removal of doubts, it is hereby declared that the mortgagee of any property referred to in sub-section (3) or any other person holding any charge, lien or other interest in, or in relation to, any such property shall be entitled to claim, in accordance with his rights and interests, payment of the mortgage money or other dues, in whole or in part, out of the amount specified in section 7, but no such mortgage, charge, lien or other interest shall be enforceable against any property which has vested in the Central Government. Section 5 provides that the Central Government or the Government company, as the case may be, shall not be liable for prior liabilities of the said company. Section 6 envisages vesting of the undertakings in a Government company if a notification in this behalf is issued by the Central Government. Chapter IV of the said Act provides for management of the undertakings of the company. Chapter V provides for provisions relating to the employees of the company. Section 13 which is relevant for our purpose reads as under : 13. Employment of certain employees to continue.- (1) Every person who has been, immediately before th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other law for the time being in force or in any instrument having effect by virtue of any law, other than the said Act, or in any decree or order of any Court, tribunal or other authority. APPLICATION OF THE ACT: The Respondents could have claimed a legal right of employment in the Appellant provided they were employed in any of the undertakings of the company immediately before the appointed day. Section 13 of the Act postulates a situation where a workman would continue to be a workman despite the statutory transfer. A workman, who has ceased to be in employment of the Company before the appointed day, therefore, would not be entitled to the benefit thereof. The order of winding up, as noticed hereinbefore, was passed by the High Court of Punjab and Haryana by order dated 6.3.1978 and a direction for terminating the services of all the workmen had also been issued by the learned Company Judge on 5.8.1977, pursuant whereto and in furtherance whereof , a settlement was arrived at by and between the Official Liquidator and the workmen. Such settlement was arrived at indisputably having regard to the provisions contained in Section 25FFF of the 1947 Act. Section 25F provide ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... High Court, that retrenchment as defined in s.2 (oo) and as used in s.25F has no wider meaning than the ordinary, accepted connotation of the word : it means the discharge of surplus labour or staff by the employer for any reason whatsoever, otherwise than as punishment inflicted by way of disciplinary action, and it has no application where the services of all workmen have been terminated by the employer on a real and bona fide closure of business as in the case of Shri Dinesh Mills Ltd. or where the services of all workmen have been terminated by the employer on the business or undertaking being taken over by another employer in circumstances like those of the Railway Company\005. The history of the legislation has been noticed by a Constitution Bench of this Court in Anakapalla Co-operative Agricultural and Industrial Society Ltd. (supra) and it, while holding that a company taking over the management of a closed undertaking may in a given situation become successor-in-interest but as regard the interpretation of the relevant provisions of the 1947 Act following Hariprasad Shivshankar Shukla (supra), opined : \005The Legislature, however, wanted to provide that though su ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... pliciter a person looses his job as he became surplus and, thus, in the case of revival of chance of employment, is given the preference in case new persons are proposed to be employed by the said undertaking; but in a case of transfer or closure of the undertaking the workman concerned is entitled to receive compensation only. It does not postulate a situation where a workman despite having received the amount of compensation would again have to be offered a job by a person reviving the industry Applicability of Section 25H of the 1947 Act in the case of closure of an undertaking came up also for consideration before this Court in Punjab Land Development and Reclamation Corporation Ltd., Chandigarh etc. vs. Presiding Officer, Labour Court, Chandigarh and Others etc. [(1990) 3 SCC 682], wherein a Constitution Bench in no uncertain terms held : \005Very briefly stated Section 25FFF which has been already discussed lays that where an undertaking is closed down for any reason whatsoever, every workman who has been in continuous service for not less than one year in that undertaking immediately before such closure shall, subject to the provisions of sub-section (2), be entitled to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Coal Mines (Nationalization) Act, 1972 (hereinafter referred to as the 1972 Act ) . It is no doubt true that the provisions of Section 17 of the 1972 Act and Section 13 of the said Act are in pari materia but before we proceed to deal with the said decisions, we may indicate that whereas in the present case, the said Act came into effect on 27.12.1980, the winding up order was passed on 6.3.1978 as a result whereof there had been no continuity of the business activity of the undertakings of the said company. The expression immediately before the appointed day contained in Section 13 of the said Act vis- -vis Section 17 of the 1972 Act is of some importance. The coking coal mines which stood nationalized by reason of the 1972 Act were running concerns whereas admittedly the undertaking of the company had not been functioning and the enactment became necessary only having regard thereto and for the purpose of utilization of production facilities and the equipment thereof. In Bharat Coking Coal Ltd. (supra), a distinction was made between a liability of the Central Government vis- -vis the Government company as contained in Section 9 and Section 17 of the 1972 Act holding that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inguished on the ground that whereas in Anakapalla Cooperative Agricultural and Industrial Society Ltd. (supra) the provision of Section 25FF was attracted, therein the provision of Section 25F was attracted, stating : 9. Shri Sinha submitted that as soon as transfer had been effected under Section 25FF of the Act all the employees became entitled to claim compensation and thus those who had been paid such compensation will not be entitled to claim reemployment under Section 25-H of the Act as the same would result in double benefit in the form of payment of compensation and immediate reemployment and, therefore, fair justice means that such workmen will not be entitled to such conferment of double benefit. It is no doubt true that this argument sounds good, but there has been no retrenchment as contemplated under Section 25-FF of the Act in the present case. The workmen in question have been retrenched long before the Colliery was taken over the respondents and, therefore, the principles stated in Anakapalle Coop. Agricultural and Industrial Society Ltd. (AIR 1963 SC 1489) in this regard cannot be applied at all. The workmen had been paid compensation only under Section 25-F a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... helpless condition to which workman would be thrown if his services are terminated without payment of compensation and presumably on the ground that if a reasonable compensation is awarded, he may be able to find out an alternative employment within a reasonable time. In the case of closure of an industrial undertaking the Act contemplates payment of compensation alone. In construing a legal fiction the purpose for which it is created should be kept in mind and should not be extended beyond the scope thereof or beyond the language by which it is created. Furthermore, it is well-known that a deeming provision cannot be pushed too far so as to result in an anomalous or absurd position. The Court must remind itself that the expressions like as if is adopted in law for a limited purpose and there cannot be any justification to extend the same beyond the purpose for which the legislature adopted it. In a recent decision, the Constitution Bench of this Court in P. Prabhakaran Vs. P. Jayarajan [JT 2005 (1) SC 173] opined: A legal fiction pre-supposes the existence of the state of facts which may not exist and then works out the consequences which flow from that state of facts ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... td. v. State Industrial Investment Corpn. of Maharashtra Ltd., Sarwan Singh v. Kasturi Lal; Allahabad Bank v. Canara Bank and Ram Narain v. Simla Banking Industrial Co. Ltd. 10. We may notice that the Special Court had in another case dealt with a similar contention. In Bhoruka Steel Ltd. v. Fairgrowth Financial Services Ltd. it had been contended that recovery proceedings under the Special Court Act should be stayed in view of the provisions of the 1985 Act. Rejecting this contention, the Special Court had come to the conclusion that the Special Court Act being a later enactment would prevail. The headnote which brings out succinctly the ratio of the said decision is as follows: Where there are two special statutes which contain non obstante clauses the later statute shall prevail. This is because at the time of enactment of the later statute, the Legislature was aware of the earlier legislation and its non obstante clause. If the Legislature still confers the later enactment with a non obstante clause it means that the Legislature wanted that enactment to prevail. If the Legislature does not want the later enactment to prevail then it could and would provide in the lat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... T 2003 (2) SC 88], this Court rejected a similar plea for regularization of services stating : \005We repeatedly asked the learned counsel for the appellants on what basis or foundation in law the appellants made their claim for regularization and under what rules their recruitment was made so as to govern their service conditions. They were not in a position to answer except saying that the appellants have been working for quite some time in various schools started pursuant to resolutions passed by zilla parishads in view of the government orders and that their cases need to be considered sympathetically. It is clear from the order of the learned single judge and looking to the very directions given a very sympathetic view was taken. We do not find it either just or proper to show any further sympathy in the given facts and circumstances of the case. While being sympathetic to the persons who come before the court the courts cannot at the same time be unsympathetic to the large number of eligible persons waiting for a long time in a long queue seeking employment\005. CONCLUSION: For the reasons aforementioned, the impugned judgment cannot be sustained which is set aside ..... X X X X Extracts X X X X X X X X Extracts X X X X
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