- 1 - IN IN IN THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORDINARY ORDINARY ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION ORIGINAL CIVIL JURISDICTION WRIT WRIT WRIT PETITION NO.2515 OF 2007 PETITION NO.2515 OF 2007 PETITION NO.2515 OF 2007 1.Eastern Shipchandlers Pvt.Ltd. 2.Aspi J. Marker ...Petitioners vs. Mumbai Kamgar Sabha ...Respondent Mr.J.P.Cama, Senior Advocate with Mr.J.C.Naidu, Mr.Manoj Gujar, Mr.Siddharth Ingale i/b M/s.C.R.Naidu & Co.for the petitioners Mr.Manoj Desai a/w Mr.M.J.Boski Sharma i/b M/s.Paras Kuhad and Associates for the respondent CORAM CORAM CORAM: A.S.OKA,J. A.S.OKA,J. A.S.OKA,J. DATE DATE DATE : APRIL 1,2008 : APRIL 1,2008 : APRIL 1,2008 ORAL JUDGMENT: ORAL JUDGMENT: ORAL JUDGMENT: 1. I have heard the submissions of the learned senior counsel for the petitioners and the learned counsel appearing for the Respondent. By this petition under section 226 of the Constitution of India the petitioners have taken an exception to the Judgment and Order dated 1st August 2007 passed by the learned Member of the Industrial Court, Mumbai on a complaint of unfair labour practice filed by the Respondent under section 28 of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act,1971 (hereinafter referred to as the said Act of 1971). The allegation of the Respondent in the said complaint is as regards the commission of Unfair Labour Practice covered by item No.9 of Schedule IV of the said Act of 1971. - 2 - 2. With a view to appreciate the submissions made by the learned Counsel for the parties, it will be necessary to refer to the facts of the case in brief. 3. The case of the respondent registered trade union is that the second petitioner is the director of M/s.Eastern Stores & Trading Co. Pvt.Ltd. which is a shop covered by the Bombay Shop and Establishment Act,1948 (hereinafter referred to as the said Act of 1948). The case of the respondent is that a dispute raised by the Respondent was referred for arbitration to the board of Arbitrators by an Agreement signed by the Respondent and the representative of the employer and the said agreement was duly published in Official Gazette on 10th October 1982 as required under section 10(A)(3) of the Industrial Disputes Act,1947 (hereinafter referred to as the said Act of 1947). According to the case of the Respondent, the name of the first Petitioner appears as at serial no.197 of the schedule of the said Agreement. The award was made on 29th October 1994. The Award was published in the Government gazette on 6th April 1995. As per the provisions of the section 17 (1) of the said Act of 1947 of the said Award became enforceable on 6th May 1995. A reference has been made in the complaint to the writ petition filed in this court by a rival union for challenging the Award and the orders passed in the said petition as well as in the Appeal preferred against interim order passed in the said petition. Reliance has been - 3 - placed on the order passed in W.P.No.1070 of 1995 by which the Award was modified. It is stated in the complaint filed by the Respondent that the Respondent had filed an earlier complaint which was withdrawn. It is stated that the said complaint was withdrawn due to subsequent events. The allegation in the complaint is as regards the failure of the Petitioner to implement the Award dated 29th October 1994. Accordingly, various prayers were made. 4. A written statement was filed by the petitioners. The first contention in the written statement was that the company by name i.e. M/s.Eastern Stores & Trading Co.Pvt.Ltd. which was a party to the Award has ceased to exist consequent to its business being wound up. It is contended that the first Petitioner is carrying on an altogether different business and the first petitioner is a service provider. It is contended that the first Respondent is carrying on completely a different business as compared to shops/establishments located in Nagdevi area of Bombay. It is contended that the first Petitioner has never supplied any material. It was submitted that the Award is not binding on the first Petitioner and therefore, the complaint was not maintainable. 5. By the impugned Judgment and Award, the complaint has been allowed and it has been declared that the petitioners have engaged in and continue to engage in unfair labour practices - 4 - under item 9 of schedule IV of the said Act of 1971. A direction was issued to implement the modified Award and to extend benefits thereunder to the concerned employees and to pay dues at the rate of 9% p.a. 6. The learned counsel for the petitioners has taken me through the pleadings and the notes of evidence. He submitted that the evidence of the said witnesses shows that the first petitioner was no longer carrying on business in the Nagdevi area to which the Award relates. He pointed out that the business of earlier company i.e. Eastern Stores & Trading Co. Pvt.Ltd. has ceased to exist and now the first Petitioner is carrying on an altogether different business in a different area. He pointed out the terms of the arbitration agreement under section 10-A of the said Act of 1947. He pointed out that the agreement records that the reference to the arbitration was relating to the workmen employed by various firms in Nagdevi area of Mumbai. He pointed out that the first Petitioner is not a party to the said agreement under section 10-A of the said Act of 1947 and consequently is not a party to the Award made by the Arbitrators. He, therefore, submitted that the complaint under section 28 of the said Act of 1971 alleging the commission of unfair labour practices under item 9 of schedule IV was not maintainable against the petitioners. He invited my attention to the decision of this court in case of Nagdevi Kamgar Sabha Vs. K.M.Desai and - 5 - others (2005 1 CLR page 519). Inviting my attention to the provisions of section 3-A of the section 10-A of the said Act of 1947, he submitted that the Award will not bind the petitioners who were not parties to the arbitration agreement unless the procedure prescribed by sub section 3-A of section 10-A of the said Act of 1947 is followed. He pointed out that the decision of the learned Single Judge in the said case relates to the same Award on the basis of which the present complaint was filed by the Respondent. He pointed out that admittedly the said procedure is not followed in the case of the 1st petitioner and therefore the Award cannot bind the petitioners. He invited my attention to the schedule to the agreement under section 10-A of the said Act of 1947. He invited my attention to the fact that an earlier complaint under section 28 of the said Act of 1971 filed on the basis of the same Award was unconditionally withdrawn. He invited my attention to the relevant part of the evidence of the witness examined by the Respondent on this aspect and in particular to the cross examination of Shri Francis I. Cardoza in which he has stated that the three employees covered by the complaint No.ULP 1183 of 1995 are also party to the present complaint. The learned counsel also submitted that the learned Member of the tribunal committed an error by allowing the complaint. 7. The learned counsel for the Respondent supported the impugned Judgment and Award. He has placed reliance on - 6 - various documents forming part of the additional compilation including the letters dated 10th February 1998 sent by the first Petitioner to certain employees who were parties to the complaint. He pointed out that the petitioners have not chosen to lead evidence. He pointed out that the decision of the learned Single Judge relied upon by the senior counsel for the petitioners will not apply to the facts of the case in hand as admittedly the name of the company i.e. M/s.Eastern Stores and Trading Co.Pvt.Ltd. has been changed to the M/s.Eastern Shipchandlers Pvt.Ltd. He submitted that the reference was not confined to workmen working in the area of Nagdevi. He invited my attention to the list of the firms covered by the agreement incorporated in Schedule I to the agreement and in particular item No.171 (Eastern Stores Trading Company Pvt.Ltd), item No.209 (M/s.F.Pestonji and Company), item No.213 (M/s.Eastern Stores Trading Company Pvt.Ltd.). He also invited my attention to the Memorandum of Association and Articles of Association of the petitioners and submitted that no interference is called for. 8. I have carefully considered the submissions made by the learned counsel for the parties. It must be stated here that the petitioners have not examined any witness. Agreement under section 10-A of the Industrial Disputes Act records that the agreement was between one M/s.Abdulbhai Faizullabhai and Co. Pvt.Ltd and other firms as mentioned in the list attached - 7 - therewith and the workmen employed by them. 9. My attention was invited to the Award made by the Arbitrator pursuant to the agreement under section 10-A of the said Act. The learned senior counsel for the petitioners while inviting my attention to the Award, relied upon clause 4 of the Annexure to the Award which refers to "that all unites of Constituent Associations situated at Nagdevi area or its adjoining areas shall observe uniform pattern of leave with wages and paid holidays" 10. Paragraph 5 of the Award reads thus : "5. The firms concerned in this reference deal in buying and selling of various goods required by individuals and industries, such as hardware materials, pipes and fittings, nuts and bolts, tools and steel produces, which are stored and sold through these establishments, which are located at Nagdevi Street, Narayan Dhuru Street, Bibijan Street, Nagdevi Cross Street etc. The establishments are of different sizes, dealing in different goods. Before this arbitration, no materials were placed in regard to the goods actually dealt with by or to the working complement of the individual firms. But the visit which the Board of Arbitrators paid to some of the firms in the relevant locality, gave a fair idea - 8 - of the business activities of the firms. While most of them are just small shops dealing in small number of items with one or two workmen in their employment, a few are large enough to have their own godowns for storage of goods and have a good number of employees on their establishments. The firms deal in a wide range of hardware goods." 11. My attention has been invited to sub clause 2 of clause III of the Memorandum of Association of the first Petitioner- Eastern Shipchandlers Private Ltd. The said clause 2 reads thus : "(2) To carry on the business of Merchants, iron-mongers, shipchandlers, engineers, mill, gin and press store suppliers and furnishers, suppliers to Railways, Water Works and other public bodies and Companies." 12. In view of the said sub clause 2, failure of the petitioners to lead evidence regarding nature of the business carried on by the first Petitioner becomes very relevant. The object of the company is to carry on the aforesaid business. 13. In the impugned order, the learned Member has referred to the Affidavit of the second Petitioner at Exh.223 in which it is stated that the name of M/s.Eastern Stores And Trading Co.Pvt.Ltd. has been changed to the name of the first - 9 - Petitioner company with effect from 7th November 1993. In view of what is stated in the affidavit, the learned Member has recorded a finding of fact that M/s.Eastern Stores And Trading Company Pvt.Ltd. which was a party to the agreement under section 10-A and to the Award is not closed but it has undergone only a change of name by which it is now known as M/s.Eastern Shipchandlers Pvt.Ltd. The fresh certificate of registration issued by the Registrar on 7th November 1993 records that the first Petitioner is not a different entity but the name of the erstwhile company has been changed to M/s.Eastern Shipchandlers Pvt.Ltd. In this context, the learned Member of the tribunal has observed that it was for the petitioners to bring the change of name of the company to the notice of the Arbitrators as the change of name has taken place after the arbitration agreement was duly published in the gazette. 14. The learned senior counsel for the Petitioners has pointed out certain statements made by the workmen examined by the Respondent to the effect that the erstwhile company M/s.Eastern Stores And Trading Company Pvt.Ltd. is not in existence. The learned Member rightly found that in view of the own case made out by the Petitioner no.2 in the evidence, it was established that the name of the earlier company which was a party to the arbitration proceedings was changed and the first Petitioner is the same company. That is why there is a - 10 - finding recorded that there was no closure of M/s.Eastern Stores And Trading Company Pvt.Ltd and what has been done is only a change of name and a fresh certificate of incorporation has been issued consequent to the change of name.Therefore, the 1st Petitioner company was very much a party to the Agreement under section 10-A of the said Act of 1947. 15. In paragraph 6 of the impugned Judgment and Order, after considering the annexures in schedule I of the arbitration agreement under section 10-A, the learned Member found that M/s.Eastern Stores And Trading Company Pvt.Ltd. and M/s.J.K. Marker & Sons and M/s.F. Pestonji & Company were the parties to the agreement and to the consequent Award of the arbitrations. In paragraph 6, it was specifically observed thus : "6....It is also not disputed that all the employees who were serving with these three companies have been taken up in the employment of respondent no.1 company in the year 1998. Notably, the Award is prior to the taking of the concerned employees in the employment of respondent no.1 company. the respondents have not disputed and it is also made clear by Shri Aspi Marker i.e. Respondent No.2 in his affidavit at Exh.U-23 that he was the Director of erstwhile M/s.Eastern Stores & Trading Co. Pvt.Ltd and that the name of the company has been changed effective - 11 - from 7.11.1993 to that of Respondent No.1 company herein." 16. While dealing with the arguments advanced on the basis of the reference to Nagdevi area in the agreement under section 10-A, in paragraph 10 of the impugned Judgment and Order, the learned Member has observed thus : "10. It is argued on behalf of the respondents that the wages, allowance and facilities available under the respondent company and those under the Award are different and the concerned employees are working in Colaba area and not in Nagdevi area, the companies in which area were considered for purpose of arbitration Award. This argument also doesn’t inspire confidence in me for, if such arguments are allowed merely by changing the name of the company and place of business, no award will be effective and implemented and the very purpose and object of the Arbitration Act itself would frustrate which may not be allowed in law. Even after change in working hours or change in nature of duties or change in business or name of a company which is party to arbitration proceeding would continue to be a party on which the Award is binding. Therefore, non-binding by the arbitration Award and violation thereof, being a clear unfair labour practice, the complainant has to be held entitled to the - 12 - relief of benefits under the Award to the concerned employees..." 17. Again on this aspect, failure of the Petitioners to examine any witness becomes very crucial. It was for the petitioners to lead evidence on this aspect and to bring on record the alleged change effected by the first Petitioner in the nature of its activities and the area of its activities. 18. Reliance placed by the learned senior counsel for the petitioners on the decision of the learned Single Judge in case of Nagdevi Kamgar Sabha (supra) will not help to the petitioners. Sub section 3-A of Section 10-A of the said Act of 1947 becomes applicable only in a case where the employers and the workmen are not parties to the arbitration agreement but are concerned in the dispute. Only in such a case, the procedure contemplated under sub-section 3-A is required to be followed. The learned Single Judge in the said case was dealing with the employers who were not parties to the arbitration Award. In this petition the first Petitioner is a party to the arbitration agreement and the Award and that is why a finding of fact has been recorded that the petitioners are bound by the Award of the Arbitrators. The learned Member has also dealt with the argument based withdrawal of earlier complaint. The learned Member found that the earlier complaint was admittedly withdrawn with permission to file a - 13 - fresh complaint. 19. Taking overall view of the matter, no case is made out for interference as the petitioners are bound by the agreement under section 10-A of the said Act of 1947 and the Award of which the breach has been alleged. No case is made out for interference under Article 226 of the Constitution of India. Writ Petition is rejected with no order as to costs. JUDGE JUDGE JUDGE