1 wp-8821-10.sxw IN THE HIGH COURT OF JUDICATURE AT BOMBAY srj CIVIL APPELLATE JURISDICTION WRIT PETITION NO.8821 OF 2010 Association of Engineering Workers ] 252, Janata Colony, Ramnarayan ] Narkar Marg, Ghatkopar (East) ] Mumbai 400 077. ] .. Petitioner V/s. 1 M/s. Shah Malleable Castings ] Ltd., Survey No.61/1-62/2. ] Chitalsar Naupada, Godbunder ] Road, Thane. ] 2 Shri Manjunath Pai, Director ] Shah Malleable Castings Ltd., ] Ashoka Chambers, Devji ] Retailing Market, Mumbai 400 009] 3 M/s. Ascent Constructions Pvt. Ltd.] Acme Ghar, 19, K.D. Road, ] Off V.M. Road, Vile Parle (West) ] Mumbai 400 056. ] 4 Pravin H. Doshi, Director ] Ascent Constructions Pvt. Ltd., ] Acme Ghar, 19, K.D. Road, ] Off V. M. Road, Vile Parle (West) ] Mumbai 400 056. ] .. Respondents. 2 wp-8821-10.sxw Mr. N.M.Ganguli, for the Petitioner. Mr. R.R. Nirmal i/b. Mr. Piyush Shah, for Respondent Nos.1 & 2. Mr. Sudhir Talsania, Mr. Vishal Talsania & Ms. Jyoti Ghag, for Respondent Nos. 3 & 4. CORAM : K.K.TATED, J. RESERVED ON : 18th APRIL, 2011. PRONOUNCED ON : 25th APRIL, 2011. JUDGMENT:- 1 Heard learned counsel for the parties. 2 Rule. 3 By consent, matter is taken on board for final hearing at the stage of admission. 4 By this Petition under Article 226 of the Constitution of India, Petitioner / original applicant challenges the order dated 16th July, 2010 passed by the learned Member, Industrial Court Bench at Thane, below Ex. U-77 in complaint (ULP) No.282 of 2004, rejecting Petitioner’s application for joining Respondent Nos.3 & 4 as parties in complaint (ULP) No.282 of 2004. 5 A few facts of the matter are as under:- (i) During period of 1985-86, there was serious labour unrest with Respondent No.1 due to inter-union rivalry between Mazdoor Congress and the Petitioner and, therefore, on 12th January, 1986, Respondent No.1 declared a lock-out after giving mandatory 14 days 3 wp-8821-10.sxw notice. The said lockout was challenged by the Petitioner by filing complaint (ULP) No.101 of 1986 under Item 1 and 6 of Schedule II and Item 9 and 10 of Schedule IV of the MRTU & PULP Act before the Industrial Court, Thane along with application for interim reliefs. On 17th October, 1986, the learned Industrial Court, Thane dismissed the application for interim reliefs. In the said complaint (ULP) No.101 of 1986 it was held that there was no prima facie case made out that the lockout was illegal or unjustified. Thereafter, by judgment and order dated 29th July, 1998, the learned Industrial Court, Bombay finally dismissed the Complaint (ULP) No.101 of 1986, thereby holding that the lockout was not illegal. (ii) The said order was challenged by the Petitioner before this Court by filing Writ Petition No.497 of 1999. The said Writ Petition was admitted by this Court but no interim relief was granted. The lockout in the factory of Respondent no.1 had persisted for over 18 years. The machinery of the factory had gone out of order. The factory building dilapidated due to rains and water-logging. A D.P. Road was sanctioned from Respondent No.1’s property by which the factory was divided into two parts. (iii) Thereafter on 15th March, 2004, Respondent No.1 filed application under section 25-O of the Industrial Disputes Act, 1947 4 wp-8821-10.sxw before the Commissioner of Labour, seeking permission to close down the undertaking since Respondent No.1 was under an erroneous impression that it had 108 workmen. The Commissioner by its letter dated 9th June, 2004 rejected Respondent No.1’s application under section 25-O on the ground that they failed to file balance sheet for the last three years before the Application. On enumeration of the workmen on its muster roll, Respondent No.1 realized that due to inadvertence it had included 14 workmen who were actually dead even on the date of the application under section 25-O. In view of the same, there was no need to take permission under section 25-O and the Respondent No.1 could effect closure under section 25FFF. On 26th July, 2004, 40 workmen voluntarily resigned from their services by accepting compensation in full and final settlement of their dues. Subsequently, 10 more workmen resigned from their services accepting compensation in full and final settlement of their dues. (iv) Thereafter, Respondent No.1 on 23rd August, 2004 declared closure under section 25 FFF of the Industrial Disputes act, 1947. The notice of the said closure was given to the relevant parties under the Act and to the 40 workmen on the rolls of Respondent No.1. Publication of the said closure was also made in reputed newspapers, inviting the workmen to approach Respondent No.1 and to accept 5 wp-8821-10.sxw their dues . (v) Thereafter, Petitioner on 27th September, 2004, filed Complaint (ULP) No. 282 of 2004, challenging the closure declared by Respondent No.1. In the said complaint, Petitioner claimed following reliefs:- “(a) Hold and declare that the Respondents have engaged in unfair labour practice under Items 9 and 10 of Schedule IV of the MRTU and PULP Act, 1971. (b) Direct the Respondents to cease and desist from engaging in unfair labour practice complained of herein above. (c) Restrain the Respondents from selling the factory premises, land and other materials to any builder and/or persons pending the hearing of this complaint. (d) Restrain the Respondents from creating any third party interests in the land and premises of the factory at the address given in the title pending the hearing of the complaint. (e) Restrain the Respondents, their agents, hirelings and third party from dismantling the factory and levelling the ground for construction purpose. (f) Direct the Respondents to maintain status-quo as on date of the filing of their complaint and to stop all the construction activities immediately. 6 wp-8821-10.sxw (g) Direct the Respondents to deposit earned wages and other dues from 5.8.2004 in the Court and the workers be allowed to take the same. (h) Direct the Respondents to pay wages from 5.8.2004 till date and thereafter month to month immediately to all the complainant-workers. (i) Direct the Respondents to provide work and all them to report for work immediately. (j) Hold and declare that the alleged closure notice dated 19.8.2004 is illegal and unlawful. (k) Quash and set aside the alleged closure notice dated 19.8.2004. (l) Restrain the Respondents from carrying out any further construction activities pending the hearing of this complaint. (m) Ad-interim and/or interim reliefs in terms of prayers as prayed for in separate application for interim reliefs. (n) Any other reliefs to meet the ends of justice. (o) Cost and compensation.” (vi) The Petitioner also preferred Interim Relief Application dated 27th September, 2004. The said interim application was rejected by the Industrial Court. Against the said rejection, Petitioner have not preferred any further proceedings. 7 wp-8821-10.sxw (vii) On 12th January, 2009, Writ Petition No.497 of 1999 filed by the Petitioner against order dated 27th July, 1998 passed by the Industrial Court, Bombay dismissing their Complaint (ULP) No.101 of 1986 in respect of declaration of lockout reached for final hearing. In the said Petition, Respondent No.1 company brought to the notice of this Court that after order of Industrial Court dated 10th March, 1997, the workmen had resigned from the services of the company and had settled the claim by giving receipt for the amount received by them are in full and final settlement of all the claims against company and that they have no claim of whatsoever nature against company. After hearing both the sides, this Court passed order dated 12th January, 2009 and disposed off the said Writ Petition as infructuous. The said order reads as under:- “(a) Mr. Rele, the learned counsel for the respondent no.1 points out an affidavit dated 22.10.2007 of Darshan Jitsingh, who was the Managing Director of the respondent company. The deponent has stated in the affidavit that subsequent to the order of the Industrial Court dated 10.3.1997, the workmen had resigned from the services of the company and had settled the claim by giving receipts that the amounts received by them are for full and final settlement of all the claims against the company and that they have no claim of whatsoever nature against the company. They have annexed a copy of the statement giving details of the workmen concerned and the payments made to them by particular cheques. 8 wp-8821-10.sxw (b) Mr. Ganguli, the learned counsel for the Petitioners, states that he has no instructions regarding the settlement. However, there is no denial to the aforesaid affidavit by way of counter-affidavit. (c) In the circumstances, the Writ Petitions are disposed of as infructuous. Rule discharged. No order as to costs.” 6 In the meanwhile, Respondent No.1 sold their property bearing survey no.61/1 situated at Chitalsar, Manpada, District Thane to Respondent Nos. 3 & 4 by registered sale deed dated 21st January, 2008. Municipal Commissioner, Thane vide its letter dated 12th February, 2009 granted Commencement Certificate to carry out development work in the factory land in favour of Respondent Nos. 3 and 4. Subsequently, Respondent No.3 commenced construction of a proposed colony of 16 building, out of which presently 4 buildings have already been constructed and third party rights have been created. 7 The Petitioner on 20th March, 2009 filed application for further interim order under section 30(2) of MRTU and PULP Act of 1971 and for impleading Respondent Nos. 3 and 4 as party Respondent in pending Complaint (ULP) No.282 of 2004 in the Industrial Court at Thane. In the said application, the Petitioner prayed for following reliefs. 9 wp-8821-10.sxw “(a) Implead M/s. ASCENT Constructions Pvt. Ltd. Acme Ghar, 19, K.D.Road, Off V.M.Road, Vile Parle (W), Mumbai 400 056 and Mr. Pravin H. Doshi, Director of M/s. ASCENT Constructions Pvt. Ltd. Acme Ghar, 19, K.D.Road, Off V.M. Road, Vile Parle (West), Mumbai 56 as a party Respondent to the present complaint. (b) After impleading the said party direct M/s. ASCENT Constructions Pvt. Ltd. Acme Ghar, 19, K.D.Road, Off. V.M.Road, Vile Parle (West) Mumbai 56 and Mr. Pravin H. Doshi, Director of M/s. ASCENT Constructions Pvt. Ltd. Acme Ghar, 19, K.D.Road, Off V.M.Road, Vile Parle (West), Mumbai 56 to disclose in writing the full name and address of their Directors. (c) Direct all the Respondents to produce in Court all the documents pertaining to the transfer and development on the land and premises on which the factory of the Respondents is situated. (d) Make any orders as seem fit and proper.” 8 In the said application, Respondent Nos. 3 and 4 filed their reply and vehemently opposed the said application on the ground that there is no relation between Petitioner and Respondent Nos.3 & 4 of employee and employer and, therefore, they are not necessary parties in the pending Complaint. They further stated in their reply that Respondent No. 1 is still in an existing company and whatever claim arises that can be enforced against Respondent No.1. 9 The Industrial Court dismissed Petitioner’s application below Ex. U-77 by impugned order dated 16th July, 2010, holding that 10 wp-8821-10.sxw Respondent Nos.3 and 4 are not necessary parties. There is no relationship of employee and employer between Petitioner and Respondent Nos.3 & 4. Petitioner can claim their demand against Respondent No.1 only. 10 Being aggrieved by the said impugned order dated 16th July, 2010, the Petitioner/ Original Applicant preferred the present Writ Petition on various grounds. 11 The learned counsel appearing on behalf of the Petitioner submits that the impugned order passed by the learned Member, Industrial Court dated 16th July, 2010 below Ex. U-77 in Complaint (ULP) No.282 of 2004 is against justice, equity and good conscious and same is liable to be set aside. He submits that the Industrial Court failed to appreciate that Respondent Nos.3 and 4 by purchasing Respondent Nos.1’s property stand in the shoes of Respondent No.1 and, therefore, Respondent Nos.3 & 4 are necessary parties in pending Complaint before Industrial Court. 12 He further submits that once the entire property is developed by Respondent Nos.3 & 4, and, if any order is passed against Respondent No.1 Company, then it will be impossible for the Petitioner to execute the same. 11 wp-8821-10.sxw 13 He submits that the Industrial Court failed to consider that their main complaint in which Petitioners are claiming reinstatement and back wages is pending for hearing and final disposal on merit. Therefore, it is necessary to protect the property of Respondent No.1 till the decision of the said complaint. As the said property purchased by Respondent Nos.3 & 4 by sale deed dated 21st January, 2008, Respondent Nos. 3 & 4 are necessary parties in the Complaint pending before Industrial Court. 14 The learned counsel appearing on behalf of the Petitioner relied on judgment in the matter of Amit Kumar Shaw and another v/s. Farida Khatooon and another reported in AIR 2005 SCC -page 2209. In that case, the Apex Court held that transferee pendente lite can be added as party if his interest in the subject matter of the suit is substantial and not just peripheral . He relied on paras 8, 10 and 12 of that authority which reads as under:- “Para – 8- On a combined reading of Order 1 Rule 10, Order XXII Rule 10 of the Code of Civil Procedure and Section 52 of the Transfer of Property Act, can an application for substitution by a subsequent transferee be rejected and the subsequent purchaser be non-suited altogether is the prime question for consideration in these appeals.” “Para – 10 - The power of a Court to add a party to a proceeding cannot depend solely on the question whether 12 wp-8821-10.sxw he has interest in the suit property. The question is whether the right of a person may be affected if he is not added as a party. Such right, however, will include necessarily an enforceable legal right.” “Para – 12 - Under Order XXII, Rule 10, no detailed inquiry at the stage of granting leave is contemplated. The Court has only to be prima facie satisfied for exercising its discretion in granting leave for continuing the suit by or against the person on whom the interest has developed by assignment or devolution. The question about the existence and validity of the assignment or devolution can be considered at the final hearing of the proceedings. The Court has only to be prima facie satisfied for exercising its discretion in granting leave for continuing the suit.” 15 Considering the facts and circumstances of the present case, the authority cited by the learned counsel appearing on behalf of the Petitioner is not applicable in the present case. In the present case, there is dispute between employer and employee under the Industrial Disputes Act for their rights and whereas in the authority cited by learned counsel appearing on behalf of Petitioner is in respect of the transfer of property of the contract between Purchaser and seller. 16 On the other hand, the learned counsel appearing on behalf of Respondent Nos.1 & 2 and 3 & 4 respectively, vehemently opposes the present Writ Petition. They submit that initially when the Petitioner filed interim application on 27th September, 2004, for 13 wp-8821-10.sxw various reliefs including injunction, restraining Respondent Nos.1 & 2 from creating third parties rights and interest in their property, the same was dismissed after hearing both the sides. The said order was not challenged by the Petitioner before the Higher Court. As there was no restraining order against Petitioner Nos. 1 & 2, they sold their property to Respondent Nos.3 & 4 by registered sale deed dated 21st February, 2008. Not only that, Respondent Nos.3 & 4 approached the authority i.e. office of the Additional Collector and competent authority, Thane for permission to carry out constructions on the factory land and the same was granted. After obtaining other permissions through local authority, Respondent Nos.3 & 4 started constructions of the proposed colony of 16 buildings out of which present 4 buildings have already been constructed and third party rights have been created. 17 The learned counsel appearing on behalf of Respondent Nos.3 & 4 submits that they purchased the said property as bonafide purchasers and, therefore, there is no question of allowing Petitioner to join them as Respondents in Complaint pending before Industrial Court for shifting proposed liability of Respondent No.1 on them. He further submits that though the lockout in the factory had persisted for over 18 years, the Petitioner failed to obtain any order from 14 wp-8821-10.sxw Industrial Court, restraining Respondent Nos.1 & 2 from creating any third party rights, title and interest in the said property and when Respondent Nos.3 & 4 after following due process of law, started constructions and completed near about 4 buildings of a proposed colony of 16 building, the Petitioner filed present application for joining them as party Respondent in pending ULP complaint. In any case, Respondent Nos. 3 and 4 are not liable, if any liability comes on Respondent Nos.1 & 2. Therefore, Industrial Court rightly rejected Petitioner’s application dated 20th March, 2009 for joining Respondent Nos.3 & 4 in Complaint (ULP) No. 282 of 2004. 18 The learned counsel appearing on behalf of Respondent Nos. 1 & 2 also vehemently opposes the present Writ Petition. He submits that initially, the Petitioner filed interim application dated 27th September, 2009, restraining them from creating any third party rights, title and interest in their property. The said interim application was rejected by Industrial Court. Against that, Petitioners have not preferred any Appeal and/or any proceedings in the Higher Court. That shows that, there was no restriction on Respondent Nos.1 & 2 from creating any third party rights, title or interest on their property. In any case, Respondent Nos.1 & 2 subsequently, offered before the Industrial Court during hearing of present interim application that 15 wp-8821-10.sxw they were ready and willing to deposit entire legal dues of Petitioners’ members in the Court, if, Petitioners were ready and willing to settle the entire dues. The said offer was flatly refused by the Petitioner before the Industrial Court. The same was recorded by the Industrial Court in impugned order dated 16th July, 2010 in para 7 which reads as under:- “Para – 7 xxxxxxxxxxxx xxxxxxxxxxxx Advocate Joglekar also pointed out that no relief can be claimed against M/s. Ascent Constructions Pvt. Ltd. because the Respondent Nos.1 & 2 have already stated through their advocate Nirmal that they are ready to deposit their dues and that the Labour Court has already granted the permission and therefore there is no question of impleading M/s. Ascent Constructions Pvt. Ltd.” That shows that Petitioners are not interested in their dues but they want to proceed with the litigation with some other intention. He further submits that when Writ Petition No.497 of 1999 which was filed on 12th January, 2009, at that time, they made categorical statement that all the workmen settled their dues and/or resigned. The same was not disputed by the Counsel appearing for Respondents in that matter. 19 Mr. Ganguli, learned counsel appearing on behalf of the Petitioner submits that he has no instructions regarding the 16 wp-8821-10.sxw settlement. However, there is no denial to the aforesaid affidavit by way of counter affidavit. 20 In view of these facts, learned counsel appearing on behalf of Respondent Nos.1 & 2 submits that there is no substance in the present Writ Petition and same is liable to be dismissed. 21 Before considering the impugned order dated 16th July, 2010 passed by the Industrial Court, it is to be noted that initially, the Petitioner filed Complaint (ULP) No.101 of 1986, challenging the lockout. The said complaint was dismissed by the Industrial Court. Thereafter, Petitioner preferred Writ Petition No.497 of 1999. That also was dismissed by the said Court. As there was no injunction restraining Respondent Nos.1 & 2 from creating any third party rights, title and interest of their property, they entered into agreement with Respondent Nos.3 & 4 for sale of the factory premises bearing survey no.61/1 situated at Chitalsar, Manpada, District Thane and executed registered sale deed dated 21st January, 2008. Thereafter, Respondent Nos.3 & 4 started development of the property. They constructed 4 building and created third party rights. 22 The Petitioner filed complaint (ULP) No.282 of 2004 in the Industrial Court at Thane under section 28 r/w. Item Nos.9 and 10 of Schedule IV of the MRTP and PULP Act, 1971 for various reliefs 17 wp-8821-10.sxw including injunction, restraining Respondent Nos.1 & 2 from creating third party rights, title and interest of their property. In that complaint, Petitioner preferred interim application on 27th September, 2004, restraining Respondent Nos.1 & 2 from creating any third party rights in the land and premises of the factory. The said interim application was rejected by the Industrial Court. The Petitioner did not prefer any proceedings against rejection of interim application in Higher Court and accepted the said order as it is. As there was no restriction on Respondent Nos.1 & 2, for selling their property, they sold their property to Respondent Nos.3 & 4 by registered sale deed dated 21st January, 2008. As Respondent Nos.3 & 4 are bonafide purchasers, there is no question of challenging their title in this proceeding and imposing any liability on them. In any case, Respondent Nos.3 & 4 are third parties to the proceedings in Complaint (ULP) No.282 of 2004, and there is no relation between Petitioner and Respondent Nos.3 & 4 of employee and employer. As there is no relation of employee and employer between Petitioner and Respondent Nos.3 & 4, the Petitioner’s application for joining them as party Respondent in the Complaint is not tenable in law. Therefore, I do not find any reason to interfere with the order passed by the Industrial Court, rejecting Petitioner’s application for joining 18 wp-8821-10.sxw Respondent Nos.3 & 4 as party in pending Complaint (ULP) No.282 of 2004 . 23 With the above observations, Writ Petition is dismissed with no order as to costs. (K.K.TATED, J.)