Full Judgment Text
2023:BHC-OS:10985
WP-14887-2023.doc
IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL JURISDICTION
WRIT PETITION (L) NO. 14887 OF 2023
1. Esselworld Leisure Pvt. Ltd.
th
14 floor, Times Tower, Kammamlam Citl,
Senampamti Bampamt Mamrg, Lower Pamrel,
Mumbami-400 013.
2. Shri Rammesh Jammdhamde,
Humamn Resources & Administramtion Heamd,
M/s. Esselworld Leisure Pvt. Ltd.
th
14 floor, Times Tower, Kammamlam Citl,
Senampamti Bampamt Mamrg, Lower Pamrel,
Mumbami-400 013.
3. Shri Ashok Goel, Director,
M/s. Esselworld Leisure Pvt. Ltd.
th
14 floor, Times Tower, Kammamlam Citl,
Senampamti Bampamt Mamrg, Lower Pamrel,
Mumbami-400 013. ...Petitioners
Versus
1. Slamm Kamshinamth Koli
2. Shamilam Albert Tuscamno
3. Sunitam N. D’souzam
4. Albert J. Pereiram
5. Jamiramm S. Yamdamv
6. Dhamrmramj B. Jamiswamr
7. Pitammbamr G. Gamnguvde
8. Gopaml M. Medamr
9. Samnjaml B. Pamtel
10. Hamnumamn R. Pamndel
11. Vincent D. Kinnl
12. Anitam Dilip Vamitl
13. Mamnoj J. Bhamndamri
14. Pramsamd J. Kurup
15. Arvind A. Samlvi
16. Dilip C. Vamitl
17. Namresh M. Dams
18. Rammesh W. Koli
19. Subhamsh J. Koli
D.A. Ethape P.A. ...1
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20. Jamgdish B. Bhamndamri
21. Rammesh S. Mamhamdik
22. Samntosh T. Pamramb
23. Jamgdish Mhamlsamkamr
24. Hemamnt Koli
25. Chamndramkamnt Koli
All C/o R.S. Upamdhlaml,
th
4-A, Lamxmi Dutt Samdamn T.P.S. III, 4
Roamd, Golibamr, Samntamcruz (Eamst),
Mumbami-400 055. ...Respondents
*
Mr. Kiramn Bampamt, Senior Advocamte with Mr. Samchin Pamthamk i/bl Mr.
Niramj Pramjampamti, for the Petitioners.
Mr. R. S. Upamdhlaml, Advocamte for Respondents.
*
CORAM : N. J. JAMADAR, J.
rd
RESERVED ON : 3 AUGUST 2023
th
PRONOUNCED ON : 29 SEPTEMBER 2023
JUDGMENT :-
1. Rule. Rule mamde returnamble forthwith. With the consent of
the leamrned Counsel for the Pamrties, heamrd fnamlll.
2. Bl this Petition under Article 226 of the Constitution of Indiam,
the petitioners tamke exception to amn order pamssed in amn Interim
Applicamtion (Exhibit U-10 in complamint ULP) No. 41 of 2022 damted
th
24 April 2023 bl the leamrned Member, Industriaml Court amt Mumbami
wherebl the Petitioners hamve been restramined from selling,
disposing amnd removing the mamchineries, equipments amnd
properties of the petitioner No.1-Compamnl.
D.A. Ethape P.A. ...2
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3. Bamckground famcts leamding to this Petition camn be sumrised ams
under: -
Petitioner No.1 is am Privamte Limited Compamnl. The Petitioner
Nos. 2 amnd 3 amre the Humamn Resources amnd Administramtion Heamd,
amnd Director of Petitioner No.1, respectivell. Petitioner No.1 hams
three divisions, nammell (1) Ride amnd Amusement Pamrk, (2) Wamter
Kingdom; amnd (3) Bird pamrk. The Petitioner No.1 hamd 134
emplolees working in its Ride amnd Amusement Pamrk Division.
Respondent Nos. 1 to 25 were ammongst those 134 emplolees.
4. With the outbreamk of Covid-19 pamndemic, the petitioners
nd
amssert, amll three units were closed since 22 Mamrch 2020. Even
otherwise, amccording to the petitioners, the petitioners were
incurring heamvl losses since the leamr 2016-2017. The Petitioners,
thus, contemplamted ampproamching the amuthorities under the
Industriaml Disputes Act, 1947 for seeking permission to retrench
the workmen. Recognized union wams informed ambout the samid
initiamtive. Thereupon, negotiamtions were held between the
petitioners-emplolers amnd the offce beamrers of the union amnd other
representamtives of the workmen over am period of time. After
protramcted deliberamtions amnd negotiamtions, amccording to the
petitioners, the emplolers amnd the recognized union amgreed to enter
into am settlement which wams famr more benefciaml to the workmen
D.A. Ethape P.A. ...3
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thamn the ammount which the workmen would hamve otherwise got in
the event of retrenchment. Thus, am settlement under Section 2(P)
reamd with Section 18(1) of the Industriaml Disputes Act, 1947 amnd
Rule 62 of the Industriaml Disputes (Mamhamramshtram) Rules, 1957 camme
to be executed between the representamtives of the emploler amnd the
th
representamtives of the union amnd workers on 14 April 2021.
5. Under the terms of settlement, it wams amgreed, inter amliam, thamt,
eamch of the workmen covered bl the samid settlement will submit
st
resignamtion from emplolment with effect from 1 April 2021 in lieu
of compensamtion in the form of ex-gramtiam amnd other dues such ams
leamve bamlamnce, gramtuitl, bonus amnd notice paml, which included samlamrl
st
for 1 April 2021. Pursuamnt to the settlement, the ammounts were
credited to the amccounts of amll 134 workmen. Eamch of them, in turn,
tendered resignamtion, mamde am declamramtion amnd pamssed receipt in
amcknowledgment of the ammount pamid towamrds full amnd fnaml
settlement of the clamim. The petitioner’s clamim thamt amn amggregamte
ammount of Rs.3,19,36,870/- wams pamid to the Respondents under the
terms of the settlement amnd it wams famr more thamn the legaml dues
otherwise pamlamble to the workmen.
6. The Respondent Nos. 1 to 25–Complaminamnts fled am complamint
of Unfamir Lambour Pramctices under Items 9 amnd 10 of Scheduled IV of
the Mamhamramshtram Recognition Of Tramde Unions And Prevention Of
D.A. Ethape P.A. ...4
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Unfamir Lambor Pramctices Act, 1971 (the Act, 1971) amlleging thamt, the
petitioners hamd brought ambout am closure of the Petitioner No.1’s
estamblishment in breamch of the mamndamte contamined in Section 25-O
of the Industriaml Disputes Act, 1947. The closure of the
estamblishment without following the mamndamte of Section 25-O of the
Act constituted amn Unfamir Lambour Pramctice under Item 9 of
Scheduled IV of the Act, 1971. It wams further amlleged thamt neither
the emploler nor the union hamd disclosed the terms amnd conditions
of the settlement before obtamining the signamtures of the workmen on
blamnk pampers. The credit of the ammount to the amccounts of the
workmen without disclosing the purpose amnd computamtion thereof
constituted amn amct of force within the meamning of Item 10 of
Scheduled IV of the Act, 1971.
7. It is further amsserted when the complaminamnts reamlized the
amlleged framud, thel sought the copies of the settlement executed bl
amnd between the emploler amnd the recognized union. As the
emploler amnd the recognized union did not furnish copies of the
settlement, thel ampproamched the Assistamnt Lambour Commissioner.
Even before the Assistamnt Lambour Commissioner, neither the
emploler nor the representamtives of the recognized union furnished
the copies of the settlement. Hence, the complaminamnts were
constramined to ampproamch the Industriaml Court with am complamint
D.A. Ethape P.A. ...5
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seeking am declamramtion thamt the petitioners engamged in Unfamir Lambur
Pramctices under Items 9 amnd 10 of Scheduled IV of the Act, 1971, the
st
closure of the estamblishment bl the petitioners on 1 April 2021
wams illegaml amnd in breamch of Section 25-O of the Industriaml Disputes
Act, 1947 amnd thamt the settlement amrrived amt between the emploler
amnd the recognized Union wams void amnd illegaml. A consequentiaml
relief of direction to the petitioners to amllow the complaminamnts to join
st
the dutl amnd paml full bamck wamges with effect from 1 April 2021 wams
amlso sought.
8. The complaminamnts fled amn ampplicamtion for interim relief
seeking directions to amllow the complaminamnts to resume the dutl
th
during the pendencl of the complamint. However, on 20 Jamnuamrl
2023, the complaminamnts sought leamve to withdramw of Interim
Applicamtion (Exhibit U-2) amsserting thamt the complaminamnts desired
to proceed with the mamin complamint. The samid ampplicamtion thus camme
to be disposed.
9. The complaminamnts preferred amnother ampplicamtion for interim
th
relief on 17 Februamrl 2023 (Exhibit U-10) seeking to restramin the
emplolers from selling, disposing amnd removing the mamchineries,
equipments amnd properties of the Petitioner No.1. It wams inter amliam
amsserted thamt the complaminamnt leamrnt thamt the petitioner No.1 hamd
resorted to the samle of equipments amnd the mamchineries amnd hamd
D.A. Ethape P.A. ...6
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amlreamdl sold six rides amnd one ride corosaml amnd wams in the process of
selling the bamlamnce rides.
10. The petitioners, who hamd resisted the complamint bl fling
written stamtement, fled amn amffdamvit-in-repll opposing the pramlers
in the second interim ampplicamtion. It wams contended thamt the
complaminamnts were fulll amwamre thamt thel hamd resigned from their
services amfter amccepting sumptuous ammount towamrds full amnd fnaml
settlement of their clamims amnd the instamnt ampplicamtion wams preferred
to amrm-twist the emploler with am design to extort amdditionaml amnd
undeserving monel from the emploler. The emploler further
contended thamt ams the mamchineries amnd equipments hamd not been in
use for more thamn three leamrs amnd were getting rust, the emploler
hamd no other option but to sell those equipments amnd mamchineries to
reamlize whamtever vamlue thel could fetch. Gramnt of interim relief, ams
sought bl the complaminamnts, would camuse irrepamramble loss to the
emploler.
11. Bl the impugned order, the leamrned Member, Industriaml Court
wams persuamded to amllow the ampplicamtion amnd restramin the emploler
from selling, disposing amnd removing the mamchineries, equipments
amnd properties. The leamrned Member, Industriaml Court wams of the
view thamt the question ams to whether the settlement amrrived amt
between the emploler amnd the recognized union amnd whether the
D.A. Ethape P.A. ...7
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cessamtion of the emplolment on the bamsis of the resignamtion
amllegedll tendered bl the workmen, were legaml amnd proper camn onll
be amdjudicamted amt the fnaml heamring of the complamint, amfter the
pamrties amdduced the evidence. However, since the non-compliamnce of
the provisions contamined in Section 25-O amnd 25-N of the Industriaml
Disputes Act, 1947 wams evident, am primam famcie camse for gramnt of
injunction wams mamde out. The leamrned Member, Industriaml Court
wams amlso of the view thamt the bamlamnce of convenience tilted in famvour
of the complaminamnts amnd thel would suffer irrepamramble loss if
injunction wams not gramnted ams with the samle of the amssets of the
petitioner No.1 the workmen would come on the street.
12. Being amggrieved, the petitioners hamve invoked the writ
jurisdiction.
13. I hamve heamrd Mr. Kiramn Bampamt, the leamrned Senior Advocamte for
the Petitioners, amnd Mr. R. S. Upamdhlaml, the leamrned Counsel for the
Respondents/Complaminamnts amt some length. With the amssistamnce of
the leamrned Counsel for the pamrties, I hamve amlso perused the
pleamdings, documents amnd mamteriaml on record.
14. Mr. Bampamt, the leamrned Senior Advocamte for the Petitioners
would urge thamt the leamrned Member, Industriaml Court committed am
gramve error in restramining the emploler from selling the
D.A. Ethape P.A. ...8
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mamchineries amnd equipments, without keeping in view the
principles which govern the gramnt of temporamrl injunction amnd
totamlll ignoring the equitamble consideramtion. Mr. Bampamt, submitted
thamt out of 134 workmen, onll 25 hamve lodged the complamint, amnd
thamt too belamtedll. Initiamlll, the complaminamnts preferred amn
ampplicamtion for interim relief in the namture of reinstamtement during
the pendencl of the complamint amnd amfter keeping the samid
ampplicamtion pending for more thamn eight months, withdrew the
samme amnd, thereamfter, with amn oblique motive, preferred the instamnt
ampplicamtion. This motive behind the litigamtion ought to hamve entered
the judiciaml verdict.
15. Mr.Bampamt, strenuousll submitted thamt the camse wams not amt amll
evamluamted on pamrammeters of bamlamnce of convenience amnd irrepamramble
loss. The Petitioners hamving pamrted with huge compensamtion of Rs.3
Crores, hamve been restramined from selling its amssets, which would
further diminish their vamlue substamntiamlll. In the peculiamr famcts of
the camse, amccording to Mr. Bampamt, the impugned order operamtes to
the gramve prejudice of the emploler. Mr. Bampamt submitted thamt, the
principaml contention of the complaminamnts thamt thel were unamwamre of
the terms of the settlement is belied bl the documents executed bl
eamch of the complaminamnts in the presence of witnesses amnd the famct
thamt sumptuous ammount wams credited to the amccounts of the eamch of
D.A. Ethape P.A. ...9
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the complaminamnts.
16. Mr. Bampamt would further urge thamt since the complaminamnts hamd
tendered resignamtion, it would not ammount to retrenchment within
the meamning of Section 2(oo) of the Industriaml Disputes Act, 1947.
In am situamtion of this namture, where amll the emplolees, amfter
amccepting their legaml dues, hamve tendered resignamtion amnd thamt
resulted in closure of the estamblishment, the mamndamte of Section 25-
O wams not required to be followed. The leamrned Member, Industriaml
Court, thus, committed am mamnifest error in holding thamt the
complaminamnts hamd mamde out am primam famcie camse.
17. In amnl event, the complaminamnts hamving amccepted amn amveramge
ammount of Rs.12 to 13 lamkhs, amnd not shown amnl inclinamtion to bring
bamck the samid ammount, could not hamve been gramnted equitamble relief,
submitted Mr. Bampamt.
18. In opposition to this Mr. Upamdhlaml, the leamrned Counsel for
the complaminamnts stoutll submitted thamt the verl settlement itself
records thamt the process of retrenchment would hamve been time
consuming amnd therebl indicamtes thamt the samid settlement wams am
subterfuge. Tamking the Court through the intrinsic evidence of the
terms of settlement amnd compamring amnd contramsting the two copies
of the settlement executed on two different stammp pampers,
D.A. Ethape P.A. ...10
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Mr.Upamdhlaml would urge thamt the settlement is am fambricamted
document. It wams urged thamt the workmen were mamde to put
signamtures on blamnk pampers amnd thereamfter the documents were
scribed to suit the convenience of the emploler.
19. Mr.Upamdhlaml would further urge thamt even if it is amssumed
thamt the settlement is genuine let since the settlement is in teeth of
the provisions of Section 25-O amnd 25-N of the Industriaml Disputes
Act, 1947, it is illegaml amnd unlamwful. Such illegaml amnd unlamwful
closure does not disrupt the emploler–emplolee relamtionship. The
Court, therefore, camnnot gramnt its imprimamture to such illegaml
settlement. To bolster up this submission, Mr. Upamdhlaml plamced am
verl strong reliamnce on the decision of the Supreme Court in the
camse of Oswaml Agro Furamne Ltd. amnd Anr. Vs. Oswaml Agro Furamne
1
Workers Union amnd Ors. .
20. Mr.Upamdhaml would urge thamt if the emploler disposes of amll its
amssets, the complamint would be rendered infructuous amnd the
workmen would be left in the lurch. Therefore, in exercise of writ
jurisdiction no interference is wamrramnted with the impugned order
which essentiamlll protects the substamnce of the dispute till the fnaml
amdjudicamtion of the complamint, submitted Mr.Upamdhlaml.
1 (2005) (1) CLR 816
D.A. Ethape P.A. ...11
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21. I hamve given amnxious consideramtion to the rivaml submissions
camnvamssed amcross the bamr. Before amdverting to amppreciamte those
submissions, it maml be opposite to note few uncontroverted famcts.
One, there is not much controversl thamt there were 134 workers
emploled in the Ride amnd Amusement Pamrk Division. Two, the
existence of recognized union in the samid estamblishment is amlso not
much in contest. Three, the famct thamt the workmen including the
st
complaminamnts ceamsed to work with the emploler with effect from 1
April 2021 is amlso indisputamble. Four, execution of the terms of
settlement purportedll under Section 2(p) reamd with Section 18(1)
of the Industriaml Disputes Act, 1947 bl amnd between the emploler
amnd the recognized union is amlso ramther incontrovertible. Five,
pamlment of the ammount under the samid settlement including
pamlment of amn ammount of Rs.3,19,36,870/- to the complaminamnts,
with the highest being Rs.14,15,118/- amnd the lowest being
Rs.10,58,389/- amppeamrs to be incontestamble. Six, bl amnd lamrge, the
execution of the documents bl eamch of the complaminamnts nammell
resignamtion letter, amuthoritl letter to the union, no dues/no liambilitl/
no objection certifcamte, declamramtion of amcceptamnce of the ammount
towamrds full amnd fnaml settlement amnd am receipt amre amlso not in
contest. However, the complaminamnts amllege thamt thel were mamde to
execute amforesamid documents framudulentll.
D.A. Ethape P.A. ...12
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22. As the thrust of the submission on behamlf of the complaminamnts
wams the non-compliamnce of the stamtutorl mamndamte contamined in
Section 25-O of the Industriaml Disputes Act, 1947, amnd ams am
necessamrl corollamrl, amlleged retrenchment brought ambout in breamch
of Section 25-N of the Industriaml Disputes Act, 1947, it maml be
amppropriamte to hamve am brief resume of the provisions contamined in
the Industriaml Disputes Act, 1947. Under clamuse (cc) of Section 2 of
the Industriaml Disputes Act, 1947, "closure" meamns the permamnent
closing down of am plamce of emplolment or pamrt thereof.
“Retrenchment”, defned under clamuse (oo), meamns the terminamtion
bl the emploler of the service of am workmamn for amnl reamson
whamtsoever, otherwise thamn ams am punishment inflicted bl waml of
disciplinamrl amction, but does not include the four eventuamlities, the
frst being, voluntamrl retirement of the workmamn. Under clamuse (p),
"settlement" meamns am settlement amrrived amt in the course of
conciliamtion proceeding amnd includes am written amgreement between
the emploler amnd workmen amrrived amt otherwise thamn in the course
of conciliamtion proceeding where such amgreement hams been signed
bl the pamrties thereto in such mamnner ams maml be prescribed amnd am
copl thereof hams been sent to amn offcer amuthorised in this behamlf bl
the amppropriamte Government amnd the conciliamtion offcer.
23. Section 25-N of the Act prescribes the conditions precedent to
D.A. Ethape P.A. ...13
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retrenchment of workmen. Section 25-O provides for the procedure
for closing down amn undertamking of amn industriaml estamblishment.
Under Section 25-N of the Act before retrenchment of workmamn
camn be amffected two conditions must be fulflled nammell (am) the
workmamn hams been given three months’ notice in writing indicamting
the reamsons for retrenchment or pamid in lieu of such notice, wamges
for the samid period; amnd (b) the prior permission of the amppropriamte
Government hams been obtamined bl the emploler upon amn
ampplicamtion hamving been mamde. Sub-section (3) of Section 25-N
vests power in the Stamte Government to gramnt or refuse permission
to retrench amn emplolee. Section 25-O enjoins amn emploler, who
intends to close down amn undertamking to amppll for prior permission
amt leamst ninetl damls before the damte on which the intended closure is
to become effective, setting out the reamsons for the intended closure
amnd simultamneousll serve am copl of such ampplicamtion on the
representamtives of the workmen in the prescribed mamnner. Sub-
section (9) of Section 25-O provides thamt where amn undertamking is
permitted to be closed down or permission for closure is deemed to
be gramnted, everl workmamn, who is emploled in thamt undertamking
immediamtell before the damte of ampplicamtion for permission under the
samid section, shamll be entitled to receive compensamtion which shamll
be equivamlent to ffteen damls’ amveramge paml for everl completed leamr
D.A. Ethape P.A. ...14
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of continuous service or amnl pamrt thereof in excess of six months.
24. Evidentll, both Section 25-N amnd 25-O amre couched in am
mamndamtorl form. Thel give effect to the public policl of preventing
the exploitamtion of lambour bl commamnding the emploler to follow
the defned process for retrenchment of amn individuaml or group of
emplolees or for closure of the estamblishment ams such.
25. In the camse amt hamnd, indisputambll, the emploler hams neither
resorted to the procedure for retrenchment of the emplolees-
workmen nor ampplied for closure of estamblishment in the mamnner
envisamged bl Section 25-O of the Industriaml Disputes Act, 1947.
Insteamd the emploler bamnks upon the settlement amrrived amt between
pamrties within the meamning of Section 2(p) of the Act, 1947. It
would be contextuamlll relevamnt to note thamt under Section 18(1) of
the Act, 1947 am settlement amrrived amt bl amn amgreement between
emploler amnd workmamn otherwise thamn in the course of conciliamtion
proceeding shamll be binding on the pamrties to the amgreement.
Proviso to sub-Section (1) of Section 18, however, gives greamter
samnctitl to the settlement between the emploler amnd the recognized
union. It provides thamt where there is am recognized union for amnl
undertamking under amnl lamw for the time being in force, then such
amgreement (not being amn amgreement in respect of dismissaml,
dischamrge, removaml, retrenchment, terminamtion of service, or
D.A. Ethape P.A. ...15
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suspension of amn emplolee) shamll be amrrived amt between the
emploler amnd the recognized union onll; amnd such amgreement shamll
be binding on amll persons referred to in clamuse (c) amnd clamuse (d) of
sub-Section (3) of the samid Section. Under clamuse (d) of sub-Section
(3), such settlement binds amll persons, who were emploled in the
estamblishment or pamrt of the estamblishment, ams the camse maml be, to
which the disputes relamtes on the damte of the dispute amnd amll persons
who subsequentll become emploled in thamt estamblishment.
26. Mr.Upamdhlaml, the leamrned Counsel for the complaminamnts urged
with am degree of vehemence thamt the question of binding effcamcl of
the settlement under Section 18(1) amnd (3) of the Industriaml
Disputes Act, 1947 would amrise onll when the settlement is lamwful.
If the settlement itself is pamtentll illegaml for being in violamtion of the
mamndamtorl provision, ams in the camse amt hamnd, such settlement is of
no amvamil. Strong reliamnce wams plamced on Oswaml Agro Furamne Ltd amnd
Anr. (supram).
27. In the camse of Oswaml Agro Furamne Ltd amnd Anr . (supram), the
th
emploler hamd issued notice to the Stamte Government on 29 Maml
1996 in terms of Section 25-O of the Industriaml Disputes Act, 1947
seeking permission for closure. Notices were amlso issued to the
th
workmen on 12 June 1996. Thereamfter, purported settlement wams
th
amrrived amt on or ambout 14 June 1996 in terms of Section 12(3) of
D.A. Ethape P.A. ...16
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the Industriaml Disputes Act, 1947. In thamt bamckdrop, the question of
vamliditl of the settlement amrose for consideramtion. After amdverting
to the provisions contamined in Section 25-N amnd 25-O of the
Industriaml Disputes Act, 1947, the Supreme Court enunciamted the
legaml position ams under:-
“14. A bamre perusaml of the provisions contamined in Sections
25-N amnd 25-O of the Act leamves no mamnner of doubt thamt the
emploler who intends to close down the undertamking amnd/or
effect retrenchment of workmen working in such industriaml
estamblishment, is bound to amppll for prior permission amt
leamst ninetl damls before the damte on which the intended
closure is to tamke plamce. Thel constitute conditions
precedent for effecting am vamlid closure, whereams the
provisions of Section 25-N of the Act provides for conditions
precedent to retrenchment; Section 25-O speamks of
procedure for closing down amn undertamking. Obtamining am
prior permission from the amppropriamte Government, thus,
must be held to be imperamtive in chamramcter.
15. A settlement within the meamning of Section 2(p) reamd
with sub-section (3) of Section 18 of the Act undoubtedll
binds the workmen but the question which would amrise is,
would it meamn thamt therebl the provisions contamined in
Sections 25-N amnd 25-O amre not required to be complied
with? The amnswer to the samid question must be rendered in
the negamtive. A settlement camn be amrrived amt between the
emploler amnd workmen in camse of amn industriaml Disputes. An
industriaml Disputes maml amrise ams regamrd the vamliditl of am
retrenchment or am closure or otherwise. Such am settlement,
however, ams regamrd retrenchment or closure camn be amrrived
amt provided such retrenchment or closure hams been effected
in amccordamnce with lamw. Requirements of issuamnce of am notice
in terms of Sections 25-N amnd 25-O, ams the camse maml, amnd/or
am decision thereupon bl the amppropriamte Government amre
cleamrll suggestive of the famct thamt therebl am public policl hams
been lamid down. The Stamte Government before gramnting or
refusing such permission is not onll required to compll with
D.A. Ethape P.A. ...17
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the principles of namturaml justice bl giving amn opportunitl of
heamring both to the emploler amnd the workmen but amlso is
required to amssign reamsons in support thereof amnd is amlso
required to pamss amn order hamving regamrd to the severaml
famctors lamid down therein. One of the famctors besides others
which is required to be tamken into consideramtion bl the
amppropriamte Government before gramnt or refusaml of such
permission is the interest of the workmen. The
amforementioned provisions being imperamtive in chamramcter
would prevamil over the right of the pamrties to amrrive amt am
settlement. Such am settlement must conform to the stamtutorl
conditions lamling down am public policl. A contramct which maml
otherwise be vamlid, however, must samtisfl the tests of public
policl not onll in terms of the amforementioned provisions
but amlso in terms of Section 23 of the Indiamn Contramct Act.”
28. The Supreme Court enunciamted thamt the provisions contamined
in Section 25-N amnd 25-O being imperamtive in chamramcter, would
prevamil over the right of the pamrties to amrrive amt am settlement. Such
am settlement must conform to the stamtutorl conditions lamling down
am public policl amnd consequences flowing from the mamndamtorl
requirements ams contamined in Section 25-N amnd 25-O must,
therefore, be given full effect to.
29. Mr.Upamdhlaml would urge thamt the amforesamid enunciamtion of lamw
governs the famcts of this camse with equaml force amnd the settlement
between emploler amnd the recognized union, even if tamken amt pamr, is
of no amssistamnce for the petitioners. The amforesamid enunciamtion of
lamw is cleamr amnd explicit. The Supreme Court hams in terms
expounded thamt the settlement hams to be in conformitl with the
D.A. Ethape P.A. ...18
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mamndamtorl provisions of lamw amnd not in derogamtion thereof.
30. One of the famctors which Mr.Bampamt pressed into service,
amppeamrs to be of some signifcamnce. In the camse of Oswaml Agro
Furamne Ltd amnd Anr . (supram), the emploler hamd amlreamdl ampplied for
permission for closure of the undertamking under Section 25-O (1) of
Industriaml Disputes Act, 1947 amnd thereamfter settlement wams
amrrived amt between the emploler amnd the workmen. In the camse amt
hamnd, however, from the perusaml of the recitamls in the settlement,
(Exhibit-A to the Petition) it becomes evident thamt, the emploler
amnd the workmen amllegedll commenced negotiamtions while the
emploler wams contemplamting retrenchment of the workmen. The
recitamls further record, the pamrties reckoned thamt the process of
retrenchment wams am lengthl one amnd the workmen would hamve got
onll retrenchment compensamtion amlong with other legaml dues, amnd,
therefore, the pamrties entered into the settlement. Undisputedll,
the bonamfde amnd genuineness of this amssertion is am mamtter for
amdjudicamtion. The terms of settlement, in the leamst, indicamte thamt
insteamd of retrenchment the emploler amnd the recognized union
decided to bring ambout cessamtion of emplolment bl pamlment of ex-
gramtiam compensamtion upon the workmen tendering resignamtion.
31. Whether this famctor of resignamtion bl the workmen is of
samlience? As noted ambove, terminamtion of the emplolment on
D.A. Ethape P.A. ...19
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amccount of voluntamrl retirement of the workmen is excluded from
the ammbit of “retrenchment”. If am workmamn voluntamrill desires to
bring amn end to emploler-emplolee relamtionship amnd the emploler
amccedes to thamt request, thamt would not constitute retrenchment
within the meamning of Section 2(oo) of the Industriaml Disputes Act
1947 amnd, resultamntll, the mamndamtorl provisions under Section 25-
N do not come into plaml.
32. As noted ambove, in camse amt hamnd, eamch of the complaminamnts
hamve tendered the resignamtion. Primam famcie, the execution, ams such,
of the resignamtion letters is not in contest, though the voluntamriness
thereof camn be questioned.
33. The position in lamw is well recognised thamt, if amn emplolee
tenders resignamtion, it would ammount to voluntamrl retirement,
within the excluded camtegorl (am) of Section 2(oo). Reliamnce plamced
bl Mr. Bampamt on the decision of the Supreme Court in the camse of J.
K. Cotton Spinning amnd Weamving Mills Compamnl Ltd. Vs. Stamte of U.P.
2
amnd Others amppeamrs to be well founded. In the samid camse the
Supreme Court wams confronted with am question: when the service of
amn emplolee is terminamted consequent upon the emploler amccepting
the resignamtion voluntamrill tendered bl the emplolee, does the
terminamtion so brought ambout ammounts to ‘Retrenchment’ ? After
2 (1990) 4 SSC 27
D.A. Ethape P.A. ...20
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amdverting to the provisions of Section 2(s) reamd with Section 6-N of
Uttamr Pramdesh Industriaml Disputes Act, 1947, which were bl amnd
lamrge similamr to the provisions of Section 2(oo) amnd Section 25-N of
the Industriaml Disputes Act, 1947, the Supreme Court amnswered the
question in the negamtive bl holding thamt when amn emplolee
voluntamrill tenders his resignamtion it is amn amct bl which he
voluntamrill gives up his job amnd such am situamtion would be covered
bl the expression “voluntamrill retirement” famlling in excluded
camtegorl (am) amnd not retrenchment amnd, thus, the provisions
contamined in Section 6-N of the samid Act would not be amttramcted.
34. Mr.Upamdhlaml, the leamrned Counsel for complaminamnts mamde amn
endevour to dramw home the point thamt the entrinsic evidence of the
terms of the settlement indicamtes thamt the terms of settlement hamve
been executed framudulentll. It would be suffce to note thamt this
question camnnot be delved into in this proceeding amnd amt this stamge.
These chamllenges camn be properll amdjudicamted amt the fnaml heamring of
the complamint before the Industriaml Court.
35. At this interim stamge, the following famctors, in ml considered
view, amssume importamnce. Primam famcie, there is mamteriaml to indicamte
thamt in amddition to the terms of settlement executed bl amnd between
the emploler amnd the recognized union, eamch of the workmen
executed the documents amdverted ambove. For instamnce, complaminamnt
D.A. Ethape P.A. ...21
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st
No.1 Shamm Koli submitted resignamtion letter on 1 April 2021 in the
presence of witnesses. He amlso executed am letter of amuthoritl in
famvour of the union. A no dues/no liambilitl/no objection certifcamte
st
wams amlso executed on 1 April 2021 in the presence of witnesses.
Mr.Shlamm Koli further amcknowledged receipt of the ammount
towamrds full amnd fnaml settlement of his legaml dues (pamge 375) amnd
th
pamssed receipt on 5 Maml 2021 (pamge 509). Execution of amll these
documents is required to be amppreciamted in the light of undisputed
pamlment of am sum of Rs.14,05,726/- to Mr. Shlamm Koli –
Complaminamnt No.1.
36. Secondll, the time lamg amnd the mamnner in which the
complaminamnts pursued the proceedings is amlso of relevamnce. The
st
settlement wams given effect from 1 April 2021. The complaminamnts
nd
clamimed thamt thel hamd amddressed notice on 2 August 2021
demamnding copies of the settlement. The complaminamnts fled the
th
complamint on 17 Februamrl 2022. Though amn ampplicamtion for
th
interim relief wams fled on 18 April 2022, it wams not pursued amnd,
th
eventuamlll, withdramwn on 20 Jamnuamrl 2023. The withdramwaml of
the Interim Applicamtion wherein purportedll am relief of
reinstamtement wams mamde, deserves due consideramtion amt this stamge.
It would impll thamt the complaminamnts did not desire to pursue the
remedl of reinstamtement bl waml of interim order under Section
D.A. Ethape P.A. ...22
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30(2) of the Act, 1947. Avamilambilitl amnd willingness of the
complaminamnts to resume the dutl thus enter the amrenam of
uncertamintl. Insteamd of seeking interim reinstamtement, the
complaminamnts professed to restramin the emploler from disposing of
the amssets.
37. At this juncture, equitamble consideramtions come into plaml. The
complaminamnts hamve been pamid the amggregamte ammount of
Rs.3,19,36,870/-. The complaminamnts hamve not shown the inclinamtion
to bring bamck the samid ammount. Where amn emplolee hams dramwn
substamntiaml beneft under am settlement, amnd still professes to amssamil
its legamlitl amnd vamliditl, equitamble consideramtions demamnd such
emplolee to restore the beneft thereunder.
38. I hamd amn occamsion to consider this amspect of the mamtter in the
camse of Lous D’Souzam amnd Ors. Vs. Hotel King’s Pamlamce amnd Anr. in
th
Writ Petition No. 2949 of 2022 decided on 5 June 2023. It wams
inter amliam observed ams under:
“35. The position in lamw is well recognized. In the camse of Mamn
Singh (supram) on which reliamnce wams plamced bl Mr. Bampamt, in
somewhamt identicaml famct-situamtion where the emplolee amlleged
thamt retirement under VRS Scheme wams brought ambout bl duress,
the Supreme Court hamd upheld the order of the High Court
directing the petitioners to deposit the ammount which wams pamid to
him bl the emploler. The Supreme Court followed am previous
pronouncement in the camse of Rammesh Chamndram Samnklam (supram)
wherein the following observamtions were mamde.
100] Even otherwise, amccording to the workmen, thel
were compelled to amccept the ammount amnd thel received
D.A. Ethape P.A. ...23
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such ammount under coercion amnd duress. In our
considered opinion, thel camnnot retamin the beneft if
thel wamnt to prosecute Clamim Petitions instituted bl
them with the Lambour Court. Hence, the order pamssed bl
the Division Bench of the High Court ams to refund of
ammount camnnot be termed unjust, inequitamble or
improper. Hence, even if it is held thamt am `technicaml'
contention ramised bl the workmen hams some force, this
Court which amgamin exercises discretionamrl amnd equitamble
jurisdiction under Article 136 of the Constitution, will
not interfere with am direction which is in consonamnce
with the doctrine of equitl. It hams been rightll samid thamt
am person "who seeks equitl must do equitl". Here the
workmen clamim benefts ams workmen of the Compamnl,
but thel do not wamnt to pamrt with the beneft thel hamve
received towamrds retirement amnd severamnce of
relamtionship of mamster amnd servamnt. It simpll camnnot be
permitted. In our judgment, therefore, the fnaml
direction issued bl the Division Bench needs no
interference, pamrticulamrll when the Compamnl hams amlso
ampproamched this Court under Article 136 of the
Constitution.
101] For the foregoing reamsons, in our opinion, the order
pamssed bl the Division Bench of the High Court deserves
to be confrmed amnd is herebl confrmed. The pamlment
which is required to be mamde ams per the samid order
should be mamde bl the ampplicamnts intending to prosecute
their clamims before the Lambour Court, Mamndsour. In view
of the famct, however, thamt the samid period is bl now over,
ends of justice would be served if we extend the time so
ams to enamble the ampplicamnts to refund the ammount. We,
therefore, extend the time up to December 31, 2008 to
mamke such pamlment. We maml, however, clamrifl thamt
Clamim Petitions will not be proceeded with till such
pamlment is mamde. If the pamlment is not mamde within the
period stipulamted ambove, the Clamim Petitions of those
ampplicamnts will amutomamticamlll stamnd dismissed. The
Lambour Court will tamke up the clamim petitions amfter 31-
12-2008”.
39. Mr. Bampamt invited amttention of the Court to amnother judgment
of am leamrned Single Judge in the camse of Smt.Phulambami Pramkamsh
3
Pamwamr Vs. SKF Indiam Ltd,. Chinchwamd, Pune amnd Anr. In the samid
camse, orders pamssed bl the Courts below directing the petitioners to
3 2016 SCC OnLine Bom 10721
D.A. Ethape P.A. ...24
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deposit the ammount which wams pamid to them under Voluntamrl
Retirement Scheme, which the petitioners therein questioned, were
under chamllenge before this Court. After referring to the
pronouncements of the Supreme Court in camse of Rammesh Chamndram
4
Samnklam Vs. Vikramm Cement amnd Anr. amnd Mamn Singh Vs. Mamruti
5
Suzuki Indiam Limited amnd Another this Court observed ams under:-
“14. The samid judgment of the Apex Court in Rammesh Chamndram
Samnklam's camse (supram) wams referred to bl amnother two judge
bench of the Apex Court in Mamn Singh's camse,(supram). A
contention wams sought to be ramised on behamlf of the workmamn in
the samid camse thamt the direction of the High Court to deposit the
ammount received bl him under the Voluntamrl Retirement
Scheme amlongwith interest amt 7.5% p.am. for the reference to
proceed wams quite inequitamble amnd illegaml. The Apex Court held
thamt the samid submission mamde on behamlf of the workmamn is fulll
amnswered bl the judgment of the Apex Court in Rammesh
Chamndram Samnklam's camse (supram) amnd reference wams mamde to
pamramgramph 100 of the samid judgment. The Apex Court thereamfter
concluded thamt the samid camse wams squamrell covered bl the
decision of the Apex Court in Rammesh Chamndram Samnklam's camse
(supram) amnd the contentions ramised on behamlf of the workmamn
thamt the High Court hamd no jurisdiction for directing refund of
the entire ammount received bl the Applicamnt ams am condition
precedent for proceeding, wams rejected. The samid judgments laml
down the proposition of lamw thamt one who seeks equitl must do
equitl amnd therefore one who camlls in question the Voluntamrl
Retirement Scheme amfter amccepting the benefts must not retamin
the benefts amnd must refund the samme.
17. In the instamnt camse, the ammount pamid under the Voluntamrl
Retirement Scheme is am lump-sum ammount amnd gramded pamlment
depending on the leamrs of service thamt am workmamn hamd put in.
There were no different heamds under which amnl ammount wams
amttributed, but wams am lump-sum pamlment. Hence, the ammount
pamid could not be divided or sepamramted under amnl heamds. The
Petitioner hams amccepted the Voluntamrl Retirement Scheme 2008
on amccount of which there is am severamnce of relamtionship ams
4 (2008) 14 SCC 58
5 (2011) 14 SCC 662
D.A. Ethape P.A. ...25
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emploler amnd emplolee but since the Petitioner is camlling in
question the samid scheme amnd is contending thamt she still is am
emplolee of the compamnl, she camnnot retamin the ammount she hams
received for leamving the compamnl. The samme camnnot be permitted
ams one who clamims equitl must do equitl. Hence equitl demamnds
thamt the Petitioner in the ambove Petition amnd the Petitioners in
the compamnion mamtters do not retamin the ammount amnd deposit the
ammount ams directed bl the Courts below. In so famr ams the samid
amspect is concerned, the famct thamt the Petitioners in the letter
damted 29.06.2009 hamve sought the difference in pamlment
between the Voluntamrl Retirement Scheme 2008 amnd Voluntamrl
Retirement Scheme 2009 is eloquent of the Petitioners reaml
intention in resiling or retramcting from the samid Voluntamrl
Retirement Scheme 2008. There is therefore substamnce in the
contention urged on behamlf of the Respondents thamt the
complamint fled is ams amnd bl waml of extramcting more monies from
the Respondent No.1.” (emphamsis supplied)
rd
40. When the mamtter wams listed before this Court on 3 Jull
2023, this Court directed the Respondents to ampprise the Court ams
to whether the Respondents were willing to bring bamck the ammount
which hams been pamid to them under the terms of the settlement,
which the complaminamnts amlleged to hamve been brought ambout bl waml
st
of framud. On 31 Jull 2023, Mr. Upamdhlaml, on instructions,
submitted thamt the Respondents-complaminamnts do not wish to bring
bamck the ammount which hams been pamid to them under terms of
settlement, whereupon the petition wams heamrd on merits.
41. The situamtion which thus obtamins is thamt the complaminamnts
hamve received substamntiaml ammount purportedll towamrds full amnd
fnaml settlement of their clamim consequent to the cessamtion of the
emploler-emplolee relamtionship. Neither the complaminamnts desire
D.A. Ethape P.A. ...26
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to bring bamck the samid ammount. Nor the complaminamnts desire to
pursue the ampplicamtion for interim relief of reinstamtement during
the pendencl of the complamint amnd, amt the samme time, the
complaminamnts profess to restramin the emploler from selling the
amssets which, in the circumstamnces of the camse, where the
undertamking hams long being closed down, camn onll further
deterioramte the amssets amnd diminish their vamlue.
42. The amforesamid famctors ought to hamve been considered bl the
leamrned Member, Industriaml Court. In the present situamtion, the
bamlamnce of convenience tilts in famvour of petitioners ramther thamn the
workmen. The leamrned Member, Industriaml Court wams not justifed in
holding thamt the complaminamnts would suffer irrepamramble loss amnd
thel would come on the street, if the amssets of the petitioner No.1
amre sold. The consequences which the impugned restramint order
entamils amre famr onerous for the emploler.
43. The conspectus of the amforesamid consideramtion is thamt the
leamrned Member, Industriaml Court did not exercise the discretion
keeping in view the principles which govern the gramnt of temporamrl
injunction. It is, therefore, necessamrl to correct the exercise of
discretion in writ jurisdiction. I amm thus impelled to amllow the
Petition. Hence, the following order:
D.A. Ethape P.A. ...27
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O R D E R
(i) Writ Petition stamnds amllowed.
th
(ii) The impugned order damted 24 April 2023 stamnds
quamshed amnd set amside.
(iii) In the circumstamnces, there shamll be no order ams to costs.
(iv) It is, however, mamde cleamr thamt the consideramtion wams
confned to determine the legamlitl, proprietl amnd
correctness of the impugned order amnd the observamtions
hereinambove shamll not influence the fnaml amdjudicamtion of
the complamint bl the Industriaml Court.
(v) Rule mamde ambsolute in the amforesamid terms.
(N. J. JAMADAR, J.)
D.A. Ethape P.A. ...28
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IN THE HIGH COURT OF JUDICATURE AT BOMBAY
ORDINARY ORIGINAL JURISDICTION
WRIT PETITION (L) NO. 14887 OF 2023
1. Esselworld Leisure Pvt. Ltd.
th
14 floor, Times Tower, Kammamlam Citl,
Senampamti Bampamt Mamrg, Lower Pamrel,
Mumbami-400 013.
2. Shri Rammesh Jammdhamde,
Humamn Resources & Administramtion Heamd,
M/s. Esselworld Leisure Pvt. Ltd.
th
14 floor, Times Tower, Kammamlam Citl,
Senampamti Bampamt Mamrg, Lower Pamrel,
Mumbami-400 013.
3. Shri Ashok Goel, Director,
M/s. Esselworld Leisure Pvt. Ltd.
th
14 floor, Times Tower, Kammamlam Citl,
Senampamti Bampamt Mamrg, Lower Pamrel,
Mumbami-400 013. ...Petitioners
Versus
1. Slamm Kamshinamth Koli
2. Shamilam Albert Tuscamno
3. Sunitam N. D’souzam
4. Albert J. Pereiram
5. Jamiramm S. Yamdamv
6. Dhamrmramj B. Jamiswamr
7. Pitammbamr G. Gamnguvde
8. Gopaml M. Medamr
9. Samnjaml B. Pamtel
10. Hamnumamn R. Pamndel
11. Vincent D. Kinnl
12. Anitam Dilip Vamitl
13. Mamnoj J. Bhamndamri
14. Pramsamd J. Kurup
15. Arvind A. Samlvi
16. Dilip C. Vamitl
17. Namresh M. Dams
18. Rammesh W. Koli
19. Subhamsh J. Koli
D.A. Ethape P.A. ...1
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20. Jamgdish B. Bhamndamri
21. Rammesh S. Mamhamdik
22. Samntosh T. Pamramb
23. Jamgdish Mhamlsamkamr
24. Hemamnt Koli
25. Chamndramkamnt Koli
All C/o R.S. Upamdhlaml,
th
4-A, Lamxmi Dutt Samdamn T.P.S. III, 4
Roamd, Golibamr, Samntamcruz (Eamst),
Mumbami-400 055. ...Respondents
*
Mr. Kiramn Bampamt, Senior Advocamte with Mr. Samchin Pamthamk i/bl Mr.
Niramj Pramjampamti, for the Petitioners.
Mr. R. S. Upamdhlaml, Advocamte for Respondents.
*
CORAM : N. J. JAMADAR, J.
rd
RESERVED ON : 3 AUGUST 2023
th
PRONOUNCED ON : 29 SEPTEMBER 2023
JUDGMENT :-
1. Rule. Rule mamde returnamble forthwith. With the consent of
the leamrned Counsel for the Pamrties, heamrd fnamlll.
2. Bl this Petition under Article 226 of the Constitution of Indiam,
the petitioners tamke exception to amn order pamssed in amn Interim
Applicamtion (Exhibit U-10 in complamint ULP) No. 41 of 2022 damted
th
24 April 2023 bl the leamrned Member, Industriaml Court amt Mumbami
wherebl the Petitioners hamve been restramined from selling,
disposing amnd removing the mamchineries, equipments amnd
properties of the petitioner No.1-Compamnl.
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3. Bamckground famcts leamding to this Petition camn be sumrised ams
under: -
Petitioner No.1 is am Privamte Limited Compamnl. The Petitioner
Nos. 2 amnd 3 amre the Humamn Resources amnd Administramtion Heamd,
amnd Director of Petitioner No.1, respectivell. Petitioner No.1 hams
three divisions, nammell (1) Ride amnd Amusement Pamrk, (2) Wamter
Kingdom; amnd (3) Bird pamrk. The Petitioner No.1 hamd 134
emplolees working in its Ride amnd Amusement Pamrk Division.
Respondent Nos. 1 to 25 were ammongst those 134 emplolees.
4. With the outbreamk of Covid-19 pamndemic, the petitioners
nd
amssert, amll three units were closed since 22 Mamrch 2020. Even
otherwise, amccording to the petitioners, the petitioners were
incurring heamvl losses since the leamr 2016-2017. The Petitioners,
thus, contemplamted ampproamching the amuthorities under the
Industriaml Disputes Act, 1947 for seeking permission to retrench
the workmen. Recognized union wams informed ambout the samid
initiamtive. Thereupon, negotiamtions were held between the
petitioners-emplolers amnd the offce beamrers of the union amnd other
representamtives of the workmen over am period of time. After
protramcted deliberamtions amnd negotiamtions, amccording to the
petitioners, the emplolers amnd the recognized union amgreed to enter
into am settlement which wams famr more benefciaml to the workmen
D.A. Ethape P.A. ...3
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thamn the ammount which the workmen would hamve otherwise got in
the event of retrenchment. Thus, am settlement under Section 2(P)
reamd with Section 18(1) of the Industriaml Disputes Act, 1947 amnd
Rule 62 of the Industriaml Disputes (Mamhamramshtram) Rules, 1957 camme
to be executed between the representamtives of the emploler amnd the
th
representamtives of the union amnd workers on 14 April 2021.
5. Under the terms of settlement, it wams amgreed, inter amliam, thamt,
eamch of the workmen covered bl the samid settlement will submit
st
resignamtion from emplolment with effect from 1 April 2021 in lieu
of compensamtion in the form of ex-gramtiam amnd other dues such ams
leamve bamlamnce, gramtuitl, bonus amnd notice paml, which included samlamrl
st
for 1 April 2021. Pursuamnt to the settlement, the ammounts were
credited to the amccounts of amll 134 workmen. Eamch of them, in turn,
tendered resignamtion, mamde am declamramtion amnd pamssed receipt in
amcknowledgment of the ammount pamid towamrds full amnd fnaml
settlement of the clamim. The petitioner’s clamim thamt amn amggregamte
ammount of Rs.3,19,36,870/- wams pamid to the Respondents under the
terms of the settlement amnd it wams famr more thamn the legaml dues
otherwise pamlamble to the workmen.
6. The Respondent Nos. 1 to 25–Complaminamnts fled am complamint
of Unfamir Lambour Pramctices under Items 9 amnd 10 of Scheduled IV of
the Mamhamramshtram Recognition Of Tramde Unions And Prevention Of
D.A. Ethape P.A. ...4
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Unfamir Lambor Pramctices Act, 1971 (the Act, 1971) amlleging thamt, the
petitioners hamd brought ambout am closure of the Petitioner No.1’s
estamblishment in breamch of the mamndamte contamined in Section 25-O
of the Industriaml Disputes Act, 1947. The closure of the
estamblishment without following the mamndamte of Section 25-O of the
Act constituted amn Unfamir Lambour Pramctice under Item 9 of
Scheduled IV of the Act, 1971. It wams further amlleged thamt neither
the emploler nor the union hamd disclosed the terms amnd conditions
of the settlement before obtamining the signamtures of the workmen on
blamnk pampers. The credit of the ammount to the amccounts of the
workmen without disclosing the purpose amnd computamtion thereof
constituted amn amct of force within the meamning of Item 10 of
Scheduled IV of the Act, 1971.
7. It is further amsserted when the complaminamnts reamlized the
amlleged framud, thel sought the copies of the settlement executed bl
amnd between the emploler amnd the recognized union. As the
emploler amnd the recognized union did not furnish copies of the
settlement, thel ampproamched the Assistamnt Lambour Commissioner.
Even before the Assistamnt Lambour Commissioner, neither the
emploler nor the representamtives of the recognized union furnished
the copies of the settlement. Hence, the complaminamnts were
constramined to ampproamch the Industriaml Court with am complamint
D.A. Ethape P.A. ...5
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seeking am declamramtion thamt the petitioners engamged in Unfamir Lambur
Pramctices under Items 9 amnd 10 of Scheduled IV of the Act, 1971, the
st
closure of the estamblishment bl the petitioners on 1 April 2021
wams illegaml amnd in breamch of Section 25-O of the Industriaml Disputes
Act, 1947 amnd thamt the settlement amrrived amt between the emploler
amnd the recognized Union wams void amnd illegaml. A consequentiaml
relief of direction to the petitioners to amllow the complaminamnts to join
st
the dutl amnd paml full bamck wamges with effect from 1 April 2021 wams
amlso sought.
8. The complaminamnts fled amn ampplicamtion for interim relief
seeking directions to amllow the complaminamnts to resume the dutl
th
during the pendencl of the complamint. However, on 20 Jamnuamrl
2023, the complaminamnts sought leamve to withdramw of Interim
Applicamtion (Exhibit U-2) amsserting thamt the complaminamnts desired
to proceed with the mamin complamint. The samid ampplicamtion thus camme
to be disposed.
9. The complaminamnts preferred amnother ampplicamtion for interim
th
relief on 17 Februamrl 2023 (Exhibit U-10) seeking to restramin the
emplolers from selling, disposing amnd removing the mamchineries,
equipments amnd properties of the Petitioner No.1. It wams inter amliam
amsserted thamt the complaminamnt leamrnt thamt the petitioner No.1 hamd
resorted to the samle of equipments amnd the mamchineries amnd hamd
D.A. Ethape P.A. ...6
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amlreamdl sold six rides amnd one ride corosaml amnd wams in the process of
selling the bamlamnce rides.
10. The petitioners, who hamd resisted the complamint bl fling
written stamtement, fled amn amffdamvit-in-repll opposing the pramlers
in the second interim ampplicamtion. It wams contended thamt the
complaminamnts were fulll amwamre thamt thel hamd resigned from their
services amfter amccepting sumptuous ammount towamrds full amnd fnaml
settlement of their clamims amnd the instamnt ampplicamtion wams preferred
to amrm-twist the emploler with am design to extort amdditionaml amnd
undeserving monel from the emploler. The emploler further
contended thamt ams the mamchineries amnd equipments hamd not been in
use for more thamn three leamrs amnd were getting rust, the emploler
hamd no other option but to sell those equipments amnd mamchineries to
reamlize whamtever vamlue thel could fetch. Gramnt of interim relief, ams
sought bl the complaminamnts, would camuse irrepamramble loss to the
emploler.
11. Bl the impugned order, the leamrned Member, Industriaml Court
wams persuamded to amllow the ampplicamtion amnd restramin the emploler
from selling, disposing amnd removing the mamchineries, equipments
amnd properties. The leamrned Member, Industriaml Court wams of the
view thamt the question ams to whether the settlement amrrived amt
between the emploler amnd the recognized union amnd whether the
D.A. Ethape P.A. ...7
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cessamtion of the emplolment on the bamsis of the resignamtion
amllegedll tendered bl the workmen, were legaml amnd proper camn onll
be amdjudicamted amt the fnaml heamring of the complamint, amfter the
pamrties amdduced the evidence. However, since the non-compliamnce of
the provisions contamined in Section 25-O amnd 25-N of the Industriaml
Disputes Act, 1947 wams evident, am primam famcie camse for gramnt of
injunction wams mamde out. The leamrned Member, Industriaml Court
wams amlso of the view thamt the bamlamnce of convenience tilted in famvour
of the complaminamnts amnd thel would suffer irrepamramble loss if
injunction wams not gramnted ams with the samle of the amssets of the
petitioner No.1 the workmen would come on the street.
12. Being amggrieved, the petitioners hamve invoked the writ
jurisdiction.
13. I hamve heamrd Mr. Kiramn Bampamt, the leamrned Senior Advocamte for
the Petitioners, amnd Mr. R. S. Upamdhlaml, the leamrned Counsel for the
Respondents/Complaminamnts amt some length. With the amssistamnce of
the leamrned Counsel for the pamrties, I hamve amlso perused the
pleamdings, documents amnd mamteriaml on record.
14. Mr. Bampamt, the leamrned Senior Advocamte for the Petitioners
would urge thamt the leamrned Member, Industriaml Court committed am
gramve error in restramining the emploler from selling the
D.A. Ethape P.A. ...8
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mamchineries amnd equipments, without keeping in view the
principles which govern the gramnt of temporamrl injunction amnd
totamlll ignoring the equitamble consideramtion. Mr. Bampamt, submitted
thamt out of 134 workmen, onll 25 hamve lodged the complamint, amnd
thamt too belamtedll. Initiamlll, the complaminamnts preferred amn
ampplicamtion for interim relief in the namture of reinstamtement during
the pendencl of the complamint amnd amfter keeping the samid
ampplicamtion pending for more thamn eight months, withdrew the
samme amnd, thereamfter, with amn oblique motive, preferred the instamnt
ampplicamtion. This motive behind the litigamtion ought to hamve entered
the judiciaml verdict.
15. Mr.Bampamt, strenuousll submitted thamt the camse wams not amt amll
evamluamted on pamrammeters of bamlamnce of convenience amnd irrepamramble
loss. The Petitioners hamving pamrted with huge compensamtion of Rs.3
Crores, hamve been restramined from selling its amssets, which would
further diminish their vamlue substamntiamlll. In the peculiamr famcts of
the camse, amccording to Mr. Bampamt, the impugned order operamtes to
the gramve prejudice of the emploler. Mr. Bampamt submitted thamt, the
principaml contention of the complaminamnts thamt thel were unamwamre of
the terms of the settlement is belied bl the documents executed bl
eamch of the complaminamnts in the presence of witnesses amnd the famct
thamt sumptuous ammount wams credited to the amccounts of the eamch of
D.A. Ethape P.A. ...9
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the complaminamnts.
16. Mr. Bampamt would further urge thamt since the complaminamnts hamd
tendered resignamtion, it would not ammount to retrenchment within
the meamning of Section 2(oo) of the Industriaml Disputes Act, 1947.
In am situamtion of this namture, where amll the emplolees, amfter
amccepting their legaml dues, hamve tendered resignamtion amnd thamt
resulted in closure of the estamblishment, the mamndamte of Section 25-
O wams not required to be followed. The leamrned Member, Industriaml
Court, thus, committed am mamnifest error in holding thamt the
complaminamnts hamd mamde out am primam famcie camse.
17. In amnl event, the complaminamnts hamving amccepted amn amveramge
ammount of Rs.12 to 13 lamkhs, amnd not shown amnl inclinamtion to bring
bamck the samid ammount, could not hamve been gramnted equitamble relief,
submitted Mr. Bampamt.
18. In opposition to this Mr. Upamdhlaml, the leamrned Counsel for
the complaminamnts stoutll submitted thamt the verl settlement itself
records thamt the process of retrenchment would hamve been time
consuming amnd therebl indicamtes thamt the samid settlement wams am
subterfuge. Tamking the Court through the intrinsic evidence of the
terms of settlement amnd compamring amnd contramsting the two copies
of the settlement executed on two different stammp pampers,
D.A. Ethape P.A. ...10
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Mr.Upamdhlaml would urge thamt the settlement is am fambricamted
document. It wams urged thamt the workmen were mamde to put
signamtures on blamnk pampers amnd thereamfter the documents were
scribed to suit the convenience of the emploler.
19. Mr.Upamdhlaml would further urge thamt even if it is amssumed
thamt the settlement is genuine let since the settlement is in teeth of
the provisions of Section 25-O amnd 25-N of the Industriaml Disputes
Act, 1947, it is illegaml amnd unlamwful. Such illegaml amnd unlamwful
closure does not disrupt the emploler–emplolee relamtionship. The
Court, therefore, camnnot gramnt its imprimamture to such illegaml
settlement. To bolster up this submission, Mr. Upamdhlaml plamced am
verl strong reliamnce on the decision of the Supreme Court in the
camse of Oswaml Agro Furamne Ltd. amnd Anr. Vs. Oswaml Agro Furamne
1
Workers Union amnd Ors. .
20. Mr.Upamdhaml would urge thamt if the emploler disposes of amll its
amssets, the complamint would be rendered infructuous amnd the
workmen would be left in the lurch. Therefore, in exercise of writ
jurisdiction no interference is wamrramnted with the impugned order
which essentiamlll protects the substamnce of the dispute till the fnaml
amdjudicamtion of the complamint, submitted Mr.Upamdhlaml.
1 (2005) (1) CLR 816
D.A. Ethape P.A. ...11
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21. I hamve given amnxious consideramtion to the rivaml submissions
camnvamssed amcross the bamr. Before amdverting to amppreciamte those
submissions, it maml be opposite to note few uncontroverted famcts.
One, there is not much controversl thamt there were 134 workers
emploled in the Ride amnd Amusement Pamrk Division. Two, the
existence of recognized union in the samid estamblishment is amlso not
much in contest. Three, the famct thamt the workmen including the
st
complaminamnts ceamsed to work with the emploler with effect from 1
April 2021 is amlso indisputamble. Four, execution of the terms of
settlement purportedll under Section 2(p) reamd with Section 18(1)
of the Industriaml Disputes Act, 1947 bl amnd between the emploler
amnd the recognized union is amlso ramther incontrovertible. Five,
pamlment of the ammount under the samid settlement including
pamlment of amn ammount of Rs.3,19,36,870/- to the complaminamnts,
with the highest being Rs.14,15,118/- amnd the lowest being
Rs.10,58,389/- amppeamrs to be incontestamble. Six, bl amnd lamrge, the
execution of the documents bl eamch of the complaminamnts nammell
resignamtion letter, amuthoritl letter to the union, no dues/no liambilitl/
no objection certifcamte, declamramtion of amcceptamnce of the ammount
towamrds full amnd fnaml settlement amnd am receipt amre amlso not in
contest. However, the complaminamnts amllege thamt thel were mamde to
execute amforesamid documents framudulentll.
D.A. Ethape P.A. ...12
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22. As the thrust of the submission on behamlf of the complaminamnts
wams the non-compliamnce of the stamtutorl mamndamte contamined in
Section 25-O of the Industriaml Disputes Act, 1947, amnd ams am
necessamrl corollamrl, amlleged retrenchment brought ambout in breamch
of Section 25-N of the Industriaml Disputes Act, 1947, it maml be
amppropriamte to hamve am brief resume of the provisions contamined in
the Industriaml Disputes Act, 1947. Under clamuse (cc) of Section 2 of
the Industriaml Disputes Act, 1947, "closure" meamns the permamnent
closing down of am plamce of emplolment or pamrt thereof.
“Retrenchment”, defned under clamuse (oo), meamns the terminamtion
bl the emploler of the service of am workmamn for amnl reamson
whamtsoever, otherwise thamn ams am punishment inflicted bl waml of
disciplinamrl amction, but does not include the four eventuamlities, the
frst being, voluntamrl retirement of the workmamn. Under clamuse (p),
"settlement" meamns am settlement amrrived amt in the course of
conciliamtion proceeding amnd includes am written amgreement between
the emploler amnd workmen amrrived amt otherwise thamn in the course
of conciliamtion proceeding where such amgreement hams been signed
bl the pamrties thereto in such mamnner ams maml be prescribed amnd am
copl thereof hams been sent to amn offcer amuthorised in this behamlf bl
the amppropriamte Government amnd the conciliamtion offcer.
23. Section 25-N of the Act prescribes the conditions precedent to
D.A. Ethape P.A. ...13
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retrenchment of workmen. Section 25-O provides for the procedure
for closing down amn undertamking of amn industriaml estamblishment.
Under Section 25-N of the Act before retrenchment of workmamn
camn be amffected two conditions must be fulflled nammell (am) the
workmamn hams been given three months’ notice in writing indicamting
the reamsons for retrenchment or pamid in lieu of such notice, wamges
for the samid period; amnd (b) the prior permission of the amppropriamte
Government hams been obtamined bl the emploler upon amn
ampplicamtion hamving been mamde. Sub-section (3) of Section 25-N
vests power in the Stamte Government to gramnt or refuse permission
to retrench amn emplolee. Section 25-O enjoins amn emploler, who
intends to close down amn undertamking to amppll for prior permission
amt leamst ninetl damls before the damte on which the intended closure is
to become effective, setting out the reamsons for the intended closure
amnd simultamneousll serve am copl of such ampplicamtion on the
representamtives of the workmen in the prescribed mamnner. Sub-
section (9) of Section 25-O provides thamt where amn undertamking is
permitted to be closed down or permission for closure is deemed to
be gramnted, everl workmamn, who is emploled in thamt undertamking
immediamtell before the damte of ampplicamtion for permission under the
samid section, shamll be entitled to receive compensamtion which shamll
be equivamlent to ffteen damls’ amveramge paml for everl completed leamr
D.A. Ethape P.A. ...14
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of continuous service or amnl pamrt thereof in excess of six months.
24. Evidentll, both Section 25-N amnd 25-O amre couched in am
mamndamtorl form. Thel give effect to the public policl of preventing
the exploitamtion of lambour bl commamnding the emploler to follow
the defned process for retrenchment of amn individuaml or group of
emplolees or for closure of the estamblishment ams such.
25. In the camse amt hamnd, indisputambll, the emploler hams neither
resorted to the procedure for retrenchment of the emplolees-
workmen nor ampplied for closure of estamblishment in the mamnner
envisamged bl Section 25-O of the Industriaml Disputes Act, 1947.
Insteamd the emploler bamnks upon the settlement amrrived amt between
pamrties within the meamning of Section 2(p) of the Act, 1947. It
would be contextuamlll relevamnt to note thamt under Section 18(1) of
the Act, 1947 am settlement amrrived amt bl amn amgreement between
emploler amnd workmamn otherwise thamn in the course of conciliamtion
proceeding shamll be binding on the pamrties to the amgreement.
Proviso to sub-Section (1) of Section 18, however, gives greamter
samnctitl to the settlement between the emploler amnd the recognized
union. It provides thamt where there is am recognized union for amnl
undertamking under amnl lamw for the time being in force, then such
amgreement (not being amn amgreement in respect of dismissaml,
dischamrge, removaml, retrenchment, terminamtion of service, or
D.A. Ethape P.A. ...15
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suspension of amn emplolee) shamll be amrrived amt between the
emploler amnd the recognized union onll; amnd such amgreement shamll
be binding on amll persons referred to in clamuse (c) amnd clamuse (d) of
sub-Section (3) of the samid Section. Under clamuse (d) of sub-Section
(3), such settlement binds amll persons, who were emploled in the
estamblishment or pamrt of the estamblishment, ams the camse maml be, to
which the disputes relamtes on the damte of the dispute amnd amll persons
who subsequentll become emploled in thamt estamblishment.
26. Mr.Upamdhlaml, the leamrned Counsel for the complaminamnts urged
with am degree of vehemence thamt the question of binding effcamcl of
the settlement under Section 18(1) amnd (3) of the Industriaml
Disputes Act, 1947 would amrise onll when the settlement is lamwful.
If the settlement itself is pamtentll illegaml for being in violamtion of the
mamndamtorl provision, ams in the camse amt hamnd, such settlement is of
no amvamil. Strong reliamnce wams plamced on Oswaml Agro Furamne Ltd amnd
Anr. (supram).
27. In the camse of Oswaml Agro Furamne Ltd amnd Anr . (supram), the
th
emploler hamd issued notice to the Stamte Government on 29 Maml
1996 in terms of Section 25-O of the Industriaml Disputes Act, 1947
seeking permission for closure. Notices were amlso issued to the
th
workmen on 12 June 1996. Thereamfter, purported settlement wams
th
amrrived amt on or ambout 14 June 1996 in terms of Section 12(3) of
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the Industriaml Disputes Act, 1947. In thamt bamckdrop, the question of
vamliditl of the settlement amrose for consideramtion. After amdverting
to the provisions contamined in Section 25-N amnd 25-O of the
Industriaml Disputes Act, 1947, the Supreme Court enunciamted the
legaml position ams under:-
“14. A bamre perusaml of the provisions contamined in Sections
25-N amnd 25-O of the Act leamves no mamnner of doubt thamt the
emploler who intends to close down the undertamking amnd/or
effect retrenchment of workmen working in such industriaml
estamblishment, is bound to amppll for prior permission amt
leamst ninetl damls before the damte on which the intended
closure is to tamke plamce. Thel constitute conditions
precedent for effecting am vamlid closure, whereams the
provisions of Section 25-N of the Act provides for conditions
precedent to retrenchment; Section 25-O speamks of
procedure for closing down amn undertamking. Obtamining am
prior permission from the amppropriamte Government, thus,
must be held to be imperamtive in chamramcter.
15. A settlement within the meamning of Section 2(p) reamd
with sub-section (3) of Section 18 of the Act undoubtedll
binds the workmen but the question which would amrise is,
would it meamn thamt therebl the provisions contamined in
Sections 25-N amnd 25-O amre not required to be complied
with? The amnswer to the samid question must be rendered in
the negamtive. A settlement camn be amrrived amt between the
emploler amnd workmen in camse of amn industriaml Disputes. An
industriaml Disputes maml amrise ams regamrd the vamliditl of am
retrenchment or am closure or otherwise. Such am settlement,
however, ams regamrd retrenchment or closure camn be amrrived
amt provided such retrenchment or closure hams been effected
in amccordamnce with lamw. Requirements of issuamnce of am notice
in terms of Sections 25-N amnd 25-O, ams the camse maml, amnd/or
am decision thereupon bl the amppropriamte Government amre
cleamrll suggestive of the famct thamt therebl am public policl hams
been lamid down. The Stamte Government before gramnting or
refusing such permission is not onll required to compll with
D.A. Ethape P.A. ...17
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the principles of namturaml justice bl giving amn opportunitl of
heamring both to the emploler amnd the workmen but amlso is
required to amssign reamsons in support thereof amnd is amlso
required to pamss amn order hamving regamrd to the severaml
famctors lamid down therein. One of the famctors besides others
which is required to be tamken into consideramtion bl the
amppropriamte Government before gramnt or refusaml of such
permission is the interest of the workmen. The
amforementioned provisions being imperamtive in chamramcter
would prevamil over the right of the pamrties to amrrive amt am
settlement. Such am settlement must conform to the stamtutorl
conditions lamling down am public policl. A contramct which maml
otherwise be vamlid, however, must samtisfl the tests of public
policl not onll in terms of the amforementioned provisions
but amlso in terms of Section 23 of the Indiamn Contramct Act.”
28. The Supreme Court enunciamted thamt the provisions contamined
in Section 25-N amnd 25-O being imperamtive in chamramcter, would
prevamil over the right of the pamrties to amrrive amt am settlement. Such
am settlement must conform to the stamtutorl conditions lamling down
am public policl amnd consequences flowing from the mamndamtorl
requirements ams contamined in Section 25-N amnd 25-O must,
therefore, be given full effect to.
29. Mr.Upamdhlaml would urge thamt the amforesamid enunciamtion of lamw
governs the famcts of this camse with equaml force amnd the settlement
between emploler amnd the recognized union, even if tamken amt pamr, is
of no amssistamnce for the petitioners. The amforesamid enunciamtion of
lamw is cleamr amnd explicit. The Supreme Court hams in terms
expounded thamt the settlement hams to be in conformitl with the
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mamndamtorl provisions of lamw amnd not in derogamtion thereof.
30. One of the famctors which Mr.Bampamt pressed into service,
amppeamrs to be of some signifcamnce. In the camse of Oswaml Agro
Furamne Ltd amnd Anr . (supram), the emploler hamd amlreamdl ampplied for
permission for closure of the undertamking under Section 25-O (1) of
Industriaml Disputes Act, 1947 amnd thereamfter settlement wams
amrrived amt between the emploler amnd the workmen. In the camse amt
hamnd, however, from the perusaml of the recitamls in the settlement,
(Exhibit-A to the Petition) it becomes evident thamt, the emploler
amnd the workmen amllegedll commenced negotiamtions while the
emploler wams contemplamting retrenchment of the workmen. The
recitamls further record, the pamrties reckoned thamt the process of
retrenchment wams am lengthl one amnd the workmen would hamve got
onll retrenchment compensamtion amlong with other legaml dues, amnd,
therefore, the pamrties entered into the settlement. Undisputedll,
the bonamfde amnd genuineness of this amssertion is am mamtter for
amdjudicamtion. The terms of settlement, in the leamst, indicamte thamt
insteamd of retrenchment the emploler amnd the recognized union
decided to bring ambout cessamtion of emplolment bl pamlment of ex-
gramtiam compensamtion upon the workmen tendering resignamtion.
31. Whether this famctor of resignamtion bl the workmen is of
samlience? As noted ambove, terminamtion of the emplolment on
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amccount of voluntamrl retirement of the workmen is excluded from
the ammbit of “retrenchment”. If am workmamn voluntamrill desires to
bring amn end to emploler-emplolee relamtionship amnd the emploler
amccedes to thamt request, thamt would not constitute retrenchment
within the meamning of Section 2(oo) of the Industriaml Disputes Act
1947 amnd, resultamntll, the mamndamtorl provisions under Section 25-
N do not come into plaml.
32. As noted ambove, in camse amt hamnd, eamch of the complaminamnts
hamve tendered the resignamtion. Primam famcie, the execution, ams such,
of the resignamtion letters is not in contest, though the voluntamriness
thereof camn be questioned.
33. The position in lamw is well recognised thamt, if amn emplolee
tenders resignamtion, it would ammount to voluntamrl retirement,
within the excluded camtegorl (am) of Section 2(oo). Reliamnce plamced
bl Mr. Bampamt on the decision of the Supreme Court in the camse of J.
K. Cotton Spinning amnd Weamving Mills Compamnl Ltd. Vs. Stamte of U.P.
2
amnd Others amppeamrs to be well founded. In the samid camse the
Supreme Court wams confronted with am question: when the service of
amn emplolee is terminamted consequent upon the emploler amccepting
the resignamtion voluntamrill tendered bl the emplolee, does the
terminamtion so brought ambout ammounts to ‘Retrenchment’ ? After
2 (1990) 4 SSC 27
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amdverting to the provisions of Section 2(s) reamd with Section 6-N of
Uttamr Pramdesh Industriaml Disputes Act, 1947, which were bl amnd
lamrge similamr to the provisions of Section 2(oo) amnd Section 25-N of
the Industriaml Disputes Act, 1947, the Supreme Court amnswered the
question in the negamtive bl holding thamt when amn emplolee
voluntamrill tenders his resignamtion it is amn amct bl which he
voluntamrill gives up his job amnd such am situamtion would be covered
bl the expression “voluntamrill retirement” famlling in excluded
camtegorl (am) amnd not retrenchment amnd, thus, the provisions
contamined in Section 6-N of the samid Act would not be amttramcted.
34. Mr.Upamdhlaml, the leamrned Counsel for complaminamnts mamde amn
endevour to dramw home the point thamt the entrinsic evidence of the
terms of the settlement indicamtes thamt the terms of settlement hamve
been executed framudulentll. It would be suffce to note thamt this
question camnnot be delved into in this proceeding amnd amt this stamge.
These chamllenges camn be properll amdjudicamted amt the fnaml heamring of
the complamint before the Industriaml Court.
35. At this interim stamge, the following famctors, in ml considered
view, amssume importamnce. Primam famcie, there is mamteriaml to indicamte
thamt in amddition to the terms of settlement executed bl amnd between
the emploler amnd the recognized union, eamch of the workmen
executed the documents amdverted ambove. For instamnce, complaminamnt
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st
No.1 Shamm Koli submitted resignamtion letter on 1 April 2021 in the
presence of witnesses. He amlso executed am letter of amuthoritl in
famvour of the union. A no dues/no liambilitl/no objection certifcamte
st
wams amlso executed on 1 April 2021 in the presence of witnesses.
Mr.Shlamm Koli further amcknowledged receipt of the ammount
towamrds full amnd fnaml settlement of his legaml dues (pamge 375) amnd
th
pamssed receipt on 5 Maml 2021 (pamge 509). Execution of amll these
documents is required to be amppreciamted in the light of undisputed
pamlment of am sum of Rs.14,05,726/- to Mr. Shlamm Koli –
Complaminamnt No.1.
36. Secondll, the time lamg amnd the mamnner in which the
complaminamnts pursued the proceedings is amlso of relevamnce. The
st
settlement wams given effect from 1 April 2021. The complaminamnts
nd
clamimed thamt thel hamd amddressed notice on 2 August 2021
demamnding copies of the settlement. The complaminamnts fled the
th
complamint on 17 Februamrl 2022. Though amn ampplicamtion for
th
interim relief wams fled on 18 April 2022, it wams not pursued amnd,
th
eventuamlll, withdramwn on 20 Jamnuamrl 2023. The withdramwaml of
the Interim Applicamtion wherein purportedll am relief of
reinstamtement wams mamde, deserves due consideramtion amt this stamge.
It would impll thamt the complaminamnts did not desire to pursue the
remedl of reinstamtement bl waml of interim order under Section
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30(2) of the Act, 1947. Avamilambilitl amnd willingness of the
complaminamnts to resume the dutl thus enter the amrenam of
uncertamintl. Insteamd of seeking interim reinstamtement, the
complaminamnts professed to restramin the emploler from disposing of
the amssets.
37. At this juncture, equitamble consideramtions come into plaml. The
complaminamnts hamve been pamid the amggregamte ammount of
Rs.3,19,36,870/-. The complaminamnts hamve not shown the inclinamtion
to bring bamck the samid ammount. Where amn emplolee hams dramwn
substamntiaml beneft under am settlement, amnd still professes to amssamil
its legamlitl amnd vamliditl, equitamble consideramtions demamnd such
emplolee to restore the beneft thereunder.
38. I hamd amn occamsion to consider this amspect of the mamtter in the
camse of Lous D’Souzam amnd Ors. Vs. Hotel King’s Pamlamce amnd Anr. in
th
Writ Petition No. 2949 of 2022 decided on 5 June 2023. It wams
inter amliam observed ams under:
“35. The position in lamw is well recognized. In the camse of Mamn
Singh (supram) on which reliamnce wams plamced bl Mr. Bampamt, in
somewhamt identicaml famct-situamtion where the emplolee amlleged
thamt retirement under VRS Scheme wams brought ambout bl duress,
the Supreme Court hamd upheld the order of the High Court
directing the petitioners to deposit the ammount which wams pamid to
him bl the emploler. The Supreme Court followed am previous
pronouncement in the camse of Rammesh Chamndram Samnklam (supram)
wherein the following observamtions were mamde.
100] Even otherwise, amccording to the workmen, thel
were compelled to amccept the ammount amnd thel received
D.A. Ethape P.A. ...23
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such ammount under coercion amnd duress. In our
considered opinion, thel camnnot retamin the beneft if
thel wamnt to prosecute Clamim Petitions instituted bl
them with the Lambour Court. Hence, the order pamssed bl
the Division Bench of the High Court ams to refund of
ammount camnnot be termed unjust, inequitamble or
improper. Hence, even if it is held thamt am `technicaml'
contention ramised bl the workmen hams some force, this
Court which amgamin exercises discretionamrl amnd equitamble
jurisdiction under Article 136 of the Constitution, will
not interfere with am direction which is in consonamnce
with the doctrine of equitl. It hams been rightll samid thamt
am person "who seeks equitl must do equitl". Here the
workmen clamim benefts ams workmen of the Compamnl,
but thel do not wamnt to pamrt with the beneft thel hamve
received towamrds retirement amnd severamnce of
relamtionship of mamster amnd servamnt. It simpll camnnot be
permitted. In our judgment, therefore, the fnaml
direction issued bl the Division Bench needs no
interference, pamrticulamrll when the Compamnl hams amlso
ampproamched this Court under Article 136 of the
Constitution.
101] For the foregoing reamsons, in our opinion, the order
pamssed bl the Division Bench of the High Court deserves
to be confrmed amnd is herebl confrmed. The pamlment
which is required to be mamde ams per the samid order
should be mamde bl the ampplicamnts intending to prosecute
their clamims before the Lambour Court, Mamndsour. In view
of the famct, however, thamt the samid period is bl now over,
ends of justice would be served if we extend the time so
ams to enamble the ampplicamnts to refund the ammount. We,
therefore, extend the time up to December 31, 2008 to
mamke such pamlment. We maml, however, clamrifl thamt
Clamim Petitions will not be proceeded with till such
pamlment is mamde. If the pamlment is not mamde within the
period stipulamted ambove, the Clamim Petitions of those
ampplicamnts will amutomamticamlll stamnd dismissed. The
Lambour Court will tamke up the clamim petitions amfter 31-
12-2008”.
39. Mr. Bampamt invited amttention of the Court to amnother judgment
of am leamrned Single Judge in the camse of Smt.Phulambami Pramkamsh
3
Pamwamr Vs. SKF Indiam Ltd,. Chinchwamd, Pune amnd Anr. In the samid
camse, orders pamssed bl the Courts below directing the petitioners to
3 2016 SCC OnLine Bom 10721
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deposit the ammount which wams pamid to them under Voluntamrl
Retirement Scheme, which the petitioners therein questioned, were
under chamllenge before this Court. After referring to the
pronouncements of the Supreme Court in camse of Rammesh Chamndram
4
Samnklam Vs. Vikramm Cement amnd Anr. amnd Mamn Singh Vs. Mamruti
5
Suzuki Indiam Limited amnd Another this Court observed ams under:-
“14. The samid judgment of the Apex Court in Rammesh Chamndram
Samnklam's camse (supram) wams referred to bl amnother two judge
bench of the Apex Court in Mamn Singh's camse,(supram). A
contention wams sought to be ramised on behamlf of the workmamn in
the samid camse thamt the direction of the High Court to deposit the
ammount received bl him under the Voluntamrl Retirement
Scheme amlongwith interest amt 7.5% p.am. for the reference to
proceed wams quite inequitamble amnd illegaml. The Apex Court held
thamt the samid submission mamde on behamlf of the workmamn is fulll
amnswered bl the judgment of the Apex Court in Rammesh
Chamndram Samnklam's camse (supram) amnd reference wams mamde to
pamramgramph 100 of the samid judgment. The Apex Court thereamfter
concluded thamt the samid camse wams squamrell covered bl the
decision of the Apex Court in Rammesh Chamndram Samnklam's camse
(supram) amnd the contentions ramised on behamlf of the workmamn
thamt the High Court hamd no jurisdiction for directing refund of
the entire ammount received bl the Applicamnt ams am condition
precedent for proceeding, wams rejected. The samid judgments laml
down the proposition of lamw thamt one who seeks equitl must do
equitl amnd therefore one who camlls in question the Voluntamrl
Retirement Scheme amfter amccepting the benefts must not retamin
the benefts amnd must refund the samme.
17. In the instamnt camse, the ammount pamid under the Voluntamrl
Retirement Scheme is am lump-sum ammount amnd gramded pamlment
depending on the leamrs of service thamt am workmamn hamd put in.
There were no different heamds under which amnl ammount wams
amttributed, but wams am lump-sum pamlment. Hence, the ammount
pamid could not be divided or sepamramted under amnl heamds. The
Petitioner hams amccepted the Voluntamrl Retirement Scheme 2008
on amccount of which there is am severamnce of relamtionship ams
4 (2008) 14 SCC 58
5 (2011) 14 SCC 662
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emploler amnd emplolee but since the Petitioner is camlling in
question the samid scheme amnd is contending thamt she still is am
emplolee of the compamnl, she camnnot retamin the ammount she hams
received for leamving the compamnl. The samme camnnot be permitted
ams one who clamims equitl must do equitl. Hence equitl demamnds
thamt the Petitioner in the ambove Petition amnd the Petitioners in
the compamnion mamtters do not retamin the ammount amnd deposit the
ammount ams directed bl the Courts below. In so famr ams the samid
amspect is concerned, the famct thamt the Petitioners in the letter
damted 29.06.2009 hamve sought the difference in pamlment
between the Voluntamrl Retirement Scheme 2008 amnd Voluntamrl
Retirement Scheme 2009 is eloquent of the Petitioners reaml
intention in resiling or retramcting from the samid Voluntamrl
Retirement Scheme 2008. There is therefore substamnce in the
contention urged on behamlf of the Respondents thamt the
complamint fled is ams amnd bl waml of extramcting more monies from
the Respondent No.1.” (emphamsis supplied)
rd
40. When the mamtter wams listed before this Court on 3 Jull
2023, this Court directed the Respondents to ampprise the Court ams
to whether the Respondents were willing to bring bamck the ammount
which hams been pamid to them under the terms of the settlement,
which the complaminamnts amlleged to hamve been brought ambout bl waml
st
of framud. On 31 Jull 2023, Mr. Upamdhlaml, on instructions,
submitted thamt the Respondents-complaminamnts do not wish to bring
bamck the ammount which hams been pamid to them under terms of
settlement, whereupon the petition wams heamrd on merits.
41. The situamtion which thus obtamins is thamt the complaminamnts
hamve received substamntiaml ammount purportedll towamrds full amnd
fnaml settlement of their clamim consequent to the cessamtion of the
emploler-emplolee relamtionship. Neither the complaminamnts desire
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to bring bamck the samid ammount. Nor the complaminamnts desire to
pursue the ampplicamtion for interim relief of reinstamtement during
the pendencl of the complamint amnd, amt the samme time, the
complaminamnts profess to restramin the emploler from selling the
amssets which, in the circumstamnces of the camse, where the
undertamking hams long being closed down, camn onll further
deterioramte the amssets amnd diminish their vamlue.
42. The amforesamid famctors ought to hamve been considered bl the
leamrned Member, Industriaml Court. In the present situamtion, the
bamlamnce of convenience tilts in famvour of petitioners ramther thamn the
workmen. The leamrned Member, Industriaml Court wams not justifed in
holding thamt the complaminamnts would suffer irrepamramble loss amnd
thel would come on the street, if the amssets of the petitioner No.1
amre sold. The consequences which the impugned restramint order
entamils amre famr onerous for the emploler.
43. The conspectus of the amforesamid consideramtion is thamt the
leamrned Member, Industriaml Court did not exercise the discretion
keeping in view the principles which govern the gramnt of temporamrl
injunction. It is, therefore, necessamrl to correct the exercise of
discretion in writ jurisdiction. I amm thus impelled to amllow the
Petition. Hence, the following order:
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O R D E R
(i) Writ Petition stamnds amllowed.
th
(ii) The impugned order damted 24 April 2023 stamnds
quamshed amnd set amside.
(iii) In the circumstamnces, there shamll be no order ams to costs.
(iv) It is, however, mamde cleamr thamt the consideramtion wams
confned to determine the legamlitl, proprietl amnd
correctness of the impugned order amnd the observamtions
hereinambove shamll not influence the fnaml amdjudicamtion of
the complamint bl the Industriaml Court.
(v) Rule mamde ambsolute in the amforesamid terms.
(N. J. JAMADAR, J.)
D.A. Ethape P.A. ...28
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