2004 (12) TMI 396 - HC - Companies Law

Issues Involved:
1. Payment of remuneration and other terms of employment for company paid staff in the office of the Official Liquidator.
2. Interim monetary benefits for company paid staff pending the formulation and finalization of the scheme.
3. Comparison of the conditions of service and pay disparity between company paid staff and Central Government staff.
4. Implementation of the principle of equal pay for equal work.
5. Absorption and regularization of company paid staff into Central Government service.
6. Financial resources and fund utilization for payment of company paid staff.

Issue-wise Detailed Analysis:

1. Payment of Remuneration and Other Terms of Employment:
The applicants, company paid staff in the office of the Official Liquidator, sought a scheme for remuneration and other terms of employment based on equal pay for equal work as Central Government staff. They referenced a similar scheme directed by the Bombay High Court in 1994 and approved by the Supreme Court in 1999. The applicants argued that despite performing similar work for similar hours, their salaries and conditions of service were inferior to those of Central Government employees.

2. Interim Monetary Benefits:
The applicants requested interim monetary benefits during the pendency of the scheme's formulation. They cited the Bombay High Court's interim order in 1999, which granted ad hoc salary increases to company paid staff. The Official Liquidator was directed to pay 25% of the differential amount of arrears of salary from the date of the Supreme Court judgment (27-8-1999) to 31-12-2004. Other claims such as gratuity and medical relief were deferred until the final scheme's consideration.

3. Comparison of Conditions of Service and Pay Disparity:
The applicants highlighted the disparity in pay and service conditions between company paid staff and Central Government staff. They argued that despite similar duties, company paid staff received lower salaries and lacked benefits. The Official Liquidator acknowledged efforts to provide proper emoluments but noted differences in recruitment procedures and fund positions between the offices in Mumbai and Ahmedabad.

4. Principle of Equal Pay for Equal Work:
The Court emphasized the need for a proper scheme ensuring no disparity in pay scales between company paid staff and Central Government staff performing the same duties. The principle of equal pay for equal work was deemed essential, and the Official Liquidator was directed to frame an exhaustive scheme based on this principle, considering schemes from other states.

5. Absorption and Regularization:
The Supreme Court's 1999 judgment directed the Central Government to frame a scheme for absorbing company paid staff into Group "C" posts. However, the applicants argued that Group "D" staff were excluded. The Court noted that the absorption process required Central Government consent and could not be directed in these proceedings. The applicants' right to absorption under the Central Government scheme remained unaffected by this order.

6. Financial Resources and Fund Utilization:
The applicants argued that the Official Liquidator's fund position in Ahmedabad was strong and could support the payment of salaries and benefits. The Official Liquidator was directed to refer the financial calculations to a Chartered Accountant for detailed scrutiny and verification. The Court permitted the premature encashment of Fixed Deposit Receipts if necessary for making payments to the applicants.

Conclusion:
The Court directed the Official Liquidator to frame a scheme for company paid staff's remuneration and benefits based on equal pay for equal work, considering schemes from other states. Interim monetary benefits were granted, and the Official Liquidator was instructed to submit a detailed report along with the Chartered Accountant's findings. The application was disposed of without costs, and the Official Liquidator was permitted to encash Fixed Deposit Receipts for payments.

← Previous Next →