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TMI Blog2001 (8) TMI 1299X X X X Extracts X X X X X X X X Extracts X X X X ..... isbursed towards the unpaid wages of the employees. Prayer ( aa ) of the motion is for an order to disburse the unpaid wages of the employees from this deposit. This motion is opposed by the respondent No. 1 through a reply by one of its directors. It is also opposed by the respondent No. 7 which is the representative union in the industry through the reply of its working President. The stand of the respondent Nos. 1 and 7 has been that these amounts should not be released merely as payments towards unpaid wages, but the same should be paid to the employees as a part of overall settlement under which the employees give up the idea of revival of the mill and opt for voluntary retirement. 2.1 Notice of Motion No. 233 of 2001 is a related motion which is also taken out by the same petitioner-trade union. Prayer ( a ) of this motion is to restrain the respondent Nos. 1 and 2 from dismantling and/or selling or removing the machinery from the premises of the respondent No. 1 mill. Prayer ( b ) is to direct them to allow the workers to mark their attendance without first tendering resignation letters. Prayer ( c ) is to seek police protection and prayer ( d ) is to direct the responde ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 22-11-1999, the Division Bench recorded that the payments/entries of payment incorporated by the respondent No. 1 appeared to be doubtful and directed the 1st respondent-company to pay the wages to the workers from June 1999 onwards (they have to be paid in fact from August 1999). 6. In the meanwhile, the BIFR, before whom the revival proceedings are pending, recorded in its order dated 25-1-2000 that a Voluntary Retirement Scheme, which has been sanctioned earlier for revival, had failed and the only option open was to explore the possibility of change in management of the company. That order also recorded that the company had expected certain inflow from one B.E. Billimoria Co., to which company a part of the land had been sold earlier under the earlier rehabilitation scheme and the company had stated that that would be sufficient to meet the wages up to January 2000 ( i.e. from August 1999 onwards). Now what is relevant to note is that in that order of 25-1-2000, the BIFR also recorded that the representatives of the company had requested that for making the payment of wages to the workers beyond January 2000 (as required under the orders of the Bombay High Court), the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01 that the sale could be allowed if it was a part of the revival proposal. Mr. Gonsalves therefore submitted that the company was duty-bound to pay the wages. The scheme for revival and the proceedings for that purpose were pending before the BIFR. In the meanwhile, the amount deposited with BIFR ought to be released to the employees and the application made by the company for sale of its assets should be considered subsequently by the BIFR and the machinery should not be allowed to be sold in the meanwhile. 9. Mr. Singhvi, the learned Senior counsel appearing for the respondent-company, on the other hand, submitted that the 1st respondent-company had entered into a settlement with the respondent No. 7, which is a representative Union under the Bombay Industrial Relations Act, 1946 ( B.I.R. Act ). That settlement was a binding settlement under section 44 of the B.I.R. Act and unless there was a specific order under section 22A of the Act, nothing could prevent the company from disposing of its assets. Mr. Singhvi submitted that the 1st respondent had no objection to the amounts lying with the BIFR being released to the employees, but those amounts should be released only in te ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion from the provisions of the Act on the right of a sick industrial company or a potentially sick industrial company to dispose of its assets. . . ." (p. 294) 11. Mr. Singhvi then submitted that in a way this petition had already been worked out. The prayers therein were with respect to the sanctioned modified scheme of 13-2-1996 prepared by the operating agency. That was prayer ( a ). That scheme had already failed. Prayer ( b ) was to pay the wages from October 1998 till the filing of the petition, i.e., March 1999. The workers had been paid their wages till July 1999. Thereafter there were many other prayers concerning the construction and sale of land, etc. Mr. Singhvi submitted, and was supported by Buch appearing for the respondent No. 7, that the petitioner union had no locus, even for that matter to file that writ petition since it was not a representative Union. But in any case, the petition had been worked out and now by taking out notices of motion, a settlement in the interest of the workers was being stalled by a minority union. That should not be permitted. 12. Mr. Gonsalves, on the other hand, in his rejoinder pointed out that prayer ( a ) of the petition ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... apart, he referred to other judgments of the Apex Court. He submitted that firstly in Maharashtra Tubes Ltd. v. State Industrial Investment Corpn. of Maharashtra Ltd. [1993] 2 SCC 144, in the context of section 22(1), the Apex Court gave a wide meaning to the expression proceedings for. . . distress or the like appearing therein. In para 10 of the judgment, the court observed that the purpose and object of this provision under section 22(1) is clearly to await the outcome of the reference made to the BIFR for the revival and rehabilitation of the sick industrial company. The court further observed that if the Corporation (SICOM) was permitted to resort to the provisions of section 29 of the 1951 Act (State Financial Corporation Act, 1951), while proceedings under sections 15 to 19 of the Act were pending, it will render the entire process nugatory. That is why the court had given a broad construction to section 22(1). Mr. Gonsalves also referred to another subsequent judgment of the Apex Court in Real Value Appliances Ltd. v. Canara Bank [1998] 5 SCC 554, which reiterated the interpretation given by the Apex Court earlier in Maharashtra Tubes Ltd. ( supra ) where in p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncerned High Court." In the present case, there are two orders dated 25-1-2000 and 1-3-2001. The orders do direct that if the company deems it necessary, it may apply for the consent of the Board to dispose of its assets. The order is very much during the preparation or consideration of a scheme under section 18. In our view, the conditions under section 22A( a ) are fulfilled. Ultimately as observed by the Apex Court in Maharashtra Tubes Ltd. s case ( supra ) as well as in Real Value Appliances Ltd. s case ( supra ), it is the legislative intent that no proceedings against the assets be taken before any decision is arrived at by BIFR or else it will be impossible to restore the status quo ante . In the circumstances, in our view, the proper course for the mill company is to apply to the BIFR for sale of the assets and to present the scheme for voluntary retirement. The machinery of the mill cannot be allowed to be disposed of until then. 14. Similarly, as far as disbursement of the amount is concerned, the respondent No. 7 Union is not as such opposed to the disbursement of the amount nor is the company. Their only submission is that the amount be released as a part of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Blow Room 2 Laltaprd. Bandhoo 3. Carding 2 Brijmohan Ramrup 4. Frame 7 Hasan Addulla 5. Frame 9 Anant Shankar 6. Frame 24 Amol Anant S. No. Department Ticket No Name 7. Ring P.D. 12 Mohan Ramchandra 8. Ring 11 Pandurang Laxman 9. Ring 31 Shivaji Chandrappa 10. Ring 37 Anant Govind 11. Ring 28 Rajaram Sitaram 12. Ring 30 Krishna Balaram 13. Ring 32 Ramchandra Dhondoo 14. Ring 37 Vijay Pandurang 15. Ruti 10 Ex. Keshav Shripat 16. Ruti 11 Ex. Deepak Ramchandra 17. Ruti 13 Ex. Tirthraj Ramkishor 18. Ruti 5 Ex. Shrikant Dalsingar 19. Auto Coner 7 Mangesh Ganpat 20. Packing 1 Santosh Wasudev 21. Packing 2 Bal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on in this behalf is different. It will be open to the petitioner-union to apply to the Court in that behalf for release of that amounts to 29 workmen or some of them and on receiving that application, the Court will consider passing appropriate orders after hearing all concerned. ( d )These amounts will be released as ad hoc payments to these workmen, subject to the determination thereon by the BIFR as to whether this payment is towards wages or VRS. The amounts will be distri-buted amongst the workmen under the supervision of the Prothonotary and Senior Master in the manner as set out in the order dated 9-9-1999 passed by Gokhale, J. in Contempt Petition (Lodging) No. 86 of 1999. ( e )In the meanwhile, after distributing the amounts for the workmen other than 29 workmen, the Prothonotary and Senior Master will make a report to the Court for seeking directions with respect to the depositing the amounts meant for these 29 workmen. 18. Notice of Motion No. 18 of 2001 is accordingly made absolute in terms of prayers ( a ) and ( aa ) as modified in the directions above. Notice of Motion No. 233 of 2001 is made absolute in terms of prayers ( a ) and ( b ). Both the notices ..... X X X X Extracts X X X X X X X X Extracts X X X X
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