IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 27.04.2011 CORAM THE HONOURABLE MR.JUSTICE K.CHANDRU W.P.Nos.18518 and 27494 of 2010 and M.P.Nos.1,1 and 2 of 2010 Maduranthagam Cooperative Sugar Mills Office Staff Association, (Regn.No.13/Kancheepuram) represented by its Secretary P.K.Jothi Maduranthagam Cooperative Sugar Mills Padalam, Kancheepuram District 603 308. ...Petitioner in W.P.No.18518/2010 Desiya Podhu Thozhilalar Orunginaippu rep by its State General Secretary R.Venkatesan 305/2, Netaji Street, Chengalpet. ... Petitioner in W.P.No.27494/2010 vs. 1.The Presiding Officer, Industrial Tribunal, Chennai. 2.The Management, Maduranthagam Cooperative Sugar Mills Padalam,Kancheepuram District. ... Respondents in W.P.No.18518/2010 1.Special Officer, Maduranthagam Cooperative Sugar Mills Ltd., Padalam, Kancheepuram District-603 308. 2.The Commissioner of Sugars, No.690, Anna Salai, Chennai-600 035. 3.State of Tamilnadu rep by Principal Secretary to Government, Industries Department, Fort St. George, Chennai. ...Respondents in W.P.No.27494/2010 W.P.No.18518 of 2010 is preferred under Article 226 of the Constitution of India praying for the issue of a writ of certiorarified mandamus to call for the records of the first respondent in connection with the impugned award dated 13.04.2006 https://hcservices.ecourts.gov.in/hcservices/ in I.D.No.21 of 2004 and quash the same and consequently to direct the second respondent to regularise the service of the 92 casual labourers listed in Annexure 2 to G.O.(D)No.443 Labour and Employment (A2) Department dated 28.04.2004 from 14.07.1993 onwards. W.P.No.27494 of 2010 is preferred under Article 226 of the Constitution of India praying for the issue of a writ of certiorarified mandamus to call for the records of the Tender Notification dated 12.11.2010 issued by the first respondent and quash the same and consequently re-employ the workmen who were already employed by the Mill. (prayer amended as per order dated 01.03.2011 by NKKJ in M.P.No.3 of 2010 in W.P.No.27494 of 2010) For Petitioners : Mr.M.Ramamoorthi in W.P.No.18518 of 2010 Mr.P.B.Suresh Babu in W.P.No.27494 of 2010 For Respondents : Ms.G.Thilagavathy for R-2 in W.P.No.18518 of 2010 and for R-1 in W.P.No.27494/2010 Ms.C.Devi, GA for R-3 in W.P.No.27494 of 2010 C O M M O N O R D E R The first writ petition (W.P.No.18518 of 2010) was filed by the Maduranthagam Co-operative Sugar Mills Office Staff Association represented by its Secretary, challenging an Award of the Industrial Tribunal, Chennai made in I.D.No.21 of 2004 dated 13.04.2006 and seeks to set aside the said Award and for a consequential regularisation of the services of 92 Casual labourers with effect from 14.07.1993, listed in Annexure 2 to G.O.(D)No.443 Labour and Employment Department dated 28.04.2004. 2. The writ petition was admitted on 13.08.2010. On notice from this Court, the second respondent Management has filed a counter affidavit dated 14.02.2011. 3. In the mean while, one Desiya Podhu Thozhilalar Orunginaippur represented by its General Secretary filed W.P.No.27494 of 2010, seeking to challenge a tender notice issued by the Special Officer of Madurantakam Cooperative Sugar Mills Limited in the Daily Thanthi newspaper dated 14.11.2010, wherein and by which, sealed tenders were invited from the reputed and experienced contractors for doing various works viz., overhauling and maintenance of the sugar factory. 4. In that writ petition, notice was directed to be issued to the respondents. Pending the writ petition, no interim order was granted. https://hcservices.ecourts.gov.in/hcservices/ 5. In the first writ petition, the petitioner Association also filed M.P.NO.1 of 2010, seeking for ad-interim direction to the second respondent Management to engage the members of the petitioner Union as casual employees, pending disposal of the writ petition. 6. When that miscellaneous application came up on being specially ordered by the Hon'ble Chief Justice vide order dated 01.04.2011, with the consent of parties, both the writ petitions were taken up for final hearing. 7. Heard the arguments of Mr.M.Ramamoorthi, learned counsel for the petitioner in W.P.No.18518 of 2010, Mr.P.B.Suresh Babu, learned counsel for the petitioner in W.P.No.27494 of 2010, Ms.G.Thilagavathy, learned counsel for the Co-operative Sugar Mills in both the writ petitions, Ms.C.Devi, learned Government Advocate appearing for the Commissioner of Sugars and the State Government in W.P.No.27494 of 2010. 8. Since the outcome of W.P.No.18518 of 2010 will have a bearing on W.P.No.27494 of 2010, it is necessary to dispose of the said writ petition first. 9. In the first writ petition, the petitioner Association raised an Industrial Dispute demanding the grant of permanency of 92 casual labourers belonging to the Petitioner Union who were hitherto working as Casual labourers. The Industrial Dispute was referred by the State Government by G.O(D)No.443, Labour and Employment Department, dated 28.04.2004. In the Annexure II to the said Government Order, the names of 92 casual labourers employed by the Management of Co-operative Sugar Mills were listed. 10. The said dispute was taken on file by the Industrial Tribunal in I.D.No.21 of 2004 and notices were issued to both parties. 11. The Union filed a claim statement dated 19.05.2004, wherein, it was claimed that the crushing capacity of the Sugar Mill for the period 1960-61 to 1968-69 was 800 tons per day and that was increased during the year 1994-95 and it reached the peak of 2500 tons per day. A Settlement under Section 12(3) of the I.D.Act dated 14.07.1993 was entered into fixing the cadre strength of the Mill at 793 permanent workmen. But the Mill Management instead of fixing an higher cadre strength recommended the reduction of cadre strength to 535 including 241 seasonal workers. All the Unions protested against the said reduction raised an industrial dispute and since the conciliation procedure had ended in failure and the issue was likely to be referred for adjudication. 12. It was also claimed that the workmen covered in Annexure II were continuously employed and they were not engaged against any leave vacancies. Except for weekly holidays, they had https://hcservices.ecourts.gov.in/hcservices/ continuos work. As per the settlement, the Mill required 793 permanent workers plus 135 temporary workmen, whereas the Management were having a total of 442 workers out of which 150 were seasonal. Apart from the above workmen, 200 workers were engaged through Contractors and the workers have completed more than 240 days of continuous service in a year. The Sugar Mill run by the Management cannot be said to be a seasonal establishment. Therefore, they are entitled for a permanent status. 13. Opposing the claim, the Management had filed a counter statement dated 22.06.2004. In the counter statement, they had admitted the cadre strength fixed under Section 12(3) of the I.D.Act, entered into on 14.07.1993. Subsequently, the cadre strength was recommended to be fixed at 535 including 294 Regular workers and 241 seasonal workmen as per the minutes of the meeting held on 25.12.1998. The Commissioner of Sugar in terms of Rule 187 of Tamilnadu Cooperative Societies rule 1988, taking into account of the technological innovations, alteration and additions made to the plant and machinery of the Mills fixed the said strength. With reference to the status of the workmen represented by the petitioner Union, it was stated that they were engaged on daily wages as per the requirement of the day against absenteeism of regular employes and leave vacancies. The wages for casual labourers were fixed under a wage formula reached in terms of Wages Settlement dated 28.09.1989 and most of the employees were engaged during the crushing season and occasionally during off-season, if so required. 14.It was also stated in the counter statement that from the year 1997-98 onwards till 2002, the capacity utilisation of the Mill came down from 51% to 20% and in 2002-02, there was no crushing at all. This was due to the drop in the availability of raw material namely cane. The Mill was facing serious financial problem. The Mill started making loss from 1995-96 which stood at Rs.160.50 crores approximately which ended at cumulative loss of Rs.134.37 crores during the year 2002-03. It was also claimed that the Mill could not even pay the lay-off compensation/retaining allowance and the expenditure of the Mill were made out of Ways and Means advance received from the Government. 15. Before the Tribunal, on behalf of the Union, 9 documents were filed and marked as Exs.W1 to W9. On the side of the Mill Management, 25 documents were filed and were marked as Exs.M1 to M25. No oral evidence was let in by either side. 16. The Tribunal on an analysis of the materials placed before it came to the conclusion that due to heavy loss suffered by the Mill, they had declared successive lay-offs and the Government had also permitted the lay-off as required under Section 25-M of the I.D.Act. These were evidenced as per Ex.M6 dated 03.06.2002, Ex.M7 dated 24.01.2003, Ex.M8 dated 16.07.2003, Ex.M9 dated 20.01.2004 and Ex.M10 dated 21.07.2004. The Government had also permitted introduction of Voluntary Retirement Scheme (VRS) as evidenced by Ex.M12, viz., G.O.No.15, Labour Department dated https://hcservices.ecourts.gov.in/hcservices/ 31.01.2005. During the time when the Mill was functioning, no such demand was raised and it was curious that the demands were raised when the Mill was going through a difficult period. It was also held that the Mill was already under continuous lay-off and subsequently the VRS Scheme has been implemented and in such circumstances, the demand of the petitioner Union seeking for regularisation was not legally justified. The Tribunal also held that the Sugar Mill is a 'Seasonal Factory' and that the provisions of Tamil Nadu Act 46 of 1981 will not apply to them. Therefore, the demand for grant of permanency was not justified. 17. Though in the affidavit filed in support of the writ petition, it was contended that the members of the Petitioner Union were engaged against permanent vacancies and the respondents should adhere to the staff strength fixed by the Settlement, there was no denial of the fact that the Mill was under continuous lay-offs from the year 2002-04 and prior permission was also given by the State Government for laying off the workman. The said statutory order was also not challenged by any person before any Court. The fact that the Mill itself had come to a standstill and all the regular workers have accepted the VRS and left the Mill was also not denied. 18. Further, the petitioners themselves by filing M.P.No.1 of 2010 have admitted that the Mill which was not functioning all these years and it was going to be started in August 2010 as per the newspaper advertisement. Therefore, they had sought for an interim direction to engage them at least as casual employees. These factors will show that the petitioners have not made out any case for the grant of permanency. Admittedly, their employment was only on casual basis. 19. In the counter affidavit filed by the Mill Management, it was stated that pursuant to the Government Order permitting the introduction of VRS, all the employees were relieved from their services with effect from 28.02.2005. Those employees have also received VRS compensation and retirement benefits. 20. In the counter affidavit filed in M.P.No.1 of 2010, the Mill Management had stated that the advertisement calling for tender for outsourcing certain works were to clear the bushes and to give a face lift for the building and for overhauling the machineries for the purpose of starting the crushing operations in the Mill. Only during the year 2010, a revival proposal of the Unit was accepted by the Government. In view of the revival of the factory and crushing season is to start, the Management had resorted to engage Contractors for overhauling the factory which has been under virtual closure for the last five years. It was also stated that it is not possible to recruit the former employees for overhauling the machineries, purchase of spares and other related works as they had received VRS Compensation. It was further stated that in so far as repairs requiring attendance by the Technical Officers and Workmen were concerned, the workmen were drawn on deputation from the other Sugar Mills. The Management has sent a https://hcservices.ecourts.gov.in/hcservices/ proposal to the Commissioner of Sugar, requesting to recommend to the Government to re-employ former employees who have gone on VRS. 21. In paragraph 5 of the counter affidavit, it was averred as follows:- "5. ...Unless the skilled employees are recruited, the casual labourers cannot be engaged by the mills, since the casual labourers alone cannot attend and complete the overhauling works. Only at the time of commencement of the crushing, as and when permanent employees are taken on a regular basis to work at the season, the daily wagers/casual employees can be engaged to assist the permanent employees. 22. Since the stand of the respondent Sugar Mill was that the present advertisement calling for tender for overhauling the machineries, upkeep the buildings, certainly the workers represented by the Petitioner Union cannot demand any work as a matter of right and that too for doing maintenance work. But at the same time, when the Sugar Mill will start functioning in a full fledged way, then certainly, the claim of the casual labourers who raised the dispute before the Tribunal cannot be ignored. This is notwithstanding the fact that the regular workers have been sent out on VRS and a proposal from the Commissioner of Sugar to re- employ was pending consideration by the Government. At present, the regular workmen are going to be drawn from the neighbouring Sugar Mills on deputation basis. This Court is not concerned with the employees who have gone on VRS. The Court is only concerned about the casual labourers who have raised a dispute before the Tribunal and who were also before this Court. Those workers are not covered by the VRS. Their claim for permanency was negatived by the Tribunal on the ground of continued loss and that being no manufacturing work carried on. The moment the manufacturing process is revived, the claim of the members of the petitioner Union will also get revived. Even if they had worked as Casual workers, during the season or off-season periods, their right to get re-employment under Section 25-H of the I.D.Act is kept intact. For the purpose of proving a right under Section 25-H of the I.D.Act, it is not necessary to prove that they had worked for 240 days during the period of one year. 23. The Supreme Court in Central Central Bank of India v. S.Satyam reported in (1996) 5 SCC 419, in paragraphs 9 to 11 observed as follows:- "9. The plain language of Section 25-H speaks only of re-employment of “retrenched workmen”. The ordinary meaning of the expression “retrenched workmen” must relate to the wide meaning of ‘retrenchment’ given in Section 2(oo). Section 25-F also uses the word ‘retrenchment’ but qualifies it by use of the further words “workman ... who has been in continuous service for not less than one year”. Thus, Section 25-F does not restrict the https://hcservices.ecourts.gov.in/hcservices/ meaning of retrenchment but qualifies the category of retrenched workmen covered therein by use of the further words “workman ... who has been in continuous service for not less than one year”. It is clear that Section 25-F applies to the retrenchment of a workman who has been in continuous service for not less than one year and not to any workman who has been in continuous service for less than one year; and it does not restrict or curtail the meaning of retrenchment merely because the provision therein is made only for the retrenchment of a workman who has been in continuous service for not less than one year. Chapter V-A deals with all retrenchments while Section 25-F is confined only to the mode of retrenchment of workmen in continuous service for not less than one year. Section 25-G prescribes the principle for retrenchment and applies ordinarily the principle of “last come first go” which is not confined only to workmen who have been in continuous service for not less than one year, covered by Section 25-F. 10. The next provision is Section 25-H which is couched in wide language and is capable of application to all retrenched workmen, not merely those covered by Section 25-F. It does not require curtailment of the ordinary meaning of the word ‘retrenchment’ used therein. The provision for re- employment of retrenched workmen merely gives preference to a retrenched workman in the matter of re-employment over other persons. It is enacted for the benefit of the retrenched workmen and there is no reason to restrict its ordinary meaning which promotes the object of the enactment without causing any prejudice to a better placed retrenched workman. 11. Chapter V-A providing for retrenchment is not enacted only for the benefit of the workmen to whom Section 25-F applies but for all cases of retrenchment and, therefore, there is no reason to restrict application of Section 25-H therein only to one category of retrenched workmen. We are, therefore, unable to accept the contention of Shri Pai that a restricted meaning should be given to the word ‘retrenchment’ in Section 25-H. This contention is, therefore, rejected." 24. Subsequently, the Supreme Court in Regional Manager, SBI v. Rakesh Kumar Tewari reported in (2006) 1 SCC 530 referred to the judgment in Satyam's case (cited supra)and in paragraph 13 held as follows:- "13. Section 25-G provides for the procedure for retrenchment of a workman. The respondents have correctly submitted that the provisions of Sections 25-G and 25-H of the Act do not require that the https://hcservices.ecourts.gov.in/hcservices/ workman should have been in continuous employment within the meaning of Section 25-B before he could be said to have been retrenched. The decision in Central Bank of India v. S. Satyam3 is clear authority on the issue. We see no reason to take a contrary view." 25. The Supreme Court in respect of a Sugar factory itself had followed the judgment in Satyam's case and Rakesh Kumar Tewari's case (cited supra) vide its judgment in Bhogpur Coop. Sugar Mills Ltd. v. Harmesh Kumar reported in (2006) 13 SCC 28. In paragraph 9, the Supreme Court has held as follows:- "9. We are not oblivious of the distinction in regard to the legality of the order of termination in a case where Section 25-F of the Act applies on the one hand, and a situation where Section 25-G thereof applies on the other. Whereas in a case where Section 25-F of the Act applies the workman is bound to prove that he had been in continuous service of 240 days during twelve months preceding the order of termination; in a case where he invokes the provisions of Sections 25-G and 25-H thereof he may not have to establish the said fact. (See Central Bank of India v. S. Satyam1, Samishta Dube v. City Board, Etawah2, SBI v. Rakesh Kumar Tewari3 and Jaipur Development Authority v. Ram Sahai4.)" 26. Therefore, the right of the members of the petitioner Union in getting re-employment on the revival of crushing season by the factory management irrespective of the fact the regular workers had gone on VRS and that the Sugar Mill is to be run by the workers to be drawn on deputation basis from the other Co-operative Sugar Mills are entitled to get restoration of their employment under Section 25-H of the I.D.Act in places in which they were employed during season or off-season periods as the case may be. The respondent Sugar Mill cannot defeat the rights of re-employment of the workmen covered by the I.D.No.21 of 2004. If such a direction is not given, the Court will fail in its duty in upholding the constitutional validity of enforcing right to livelihood enshrined under Articles 21 r/w 41 and 43 of the Constitution and guaranteed to certain extent by the Industrial Disputes Act, 1947. 27. In this context, it is necessary to refer to the judgment of the Supreme Court in Harjinder Singh v. Punjab State Warehousing Corpn reported in (2010) 3 SCC 192, wherein, the Court reminded all Courts the constitutional obligation to guarantee the right to livelihood. It is necessary to refer to paragraphs 30 and 31, which are as follows:- "30. Of late, there has been a visible shift in the courts’ approach in dealing with the cases involving the interpretation of social welfare legislations. The attractive mantras of globalisation and liberalisation are fast becoming the raison d’être https://hcservices.ecourts.gov.in/hcservices/ of the judicial process and an impression has been created that the constitutional courts are no longer sympathetic towards the plight of industrial and unorganised workers. In large number of cases like the present one, relief has been denied to the employees falling in the category of workmen, who are illegally retrenched from service by creating by-lanes and side-lanes in the jurisprudence developed by this Court in three decades. The stock plea raised by the public employer in such cases is that the initial employment/engagement of the workman/employee was contrary to some or the other statute or that reinstatement of the workman will put unbearable burden on the financial health of the establishment. The courts have readily accepted such plea unmindful of the accountability of the wrong doer and indirectly punished the tiny beneficiary of the wrong ignoring the fact that he may have continued in the employment for years together and that micro wages earned by him may be the only source of his livelihood. 31. It need no emphasis that if a man is deprived of his livelihood, he is deprived of all his fundamental and constitutional rights and for him the goal of social and economic justice, equality of status and of opportunity, the freedoms enshrined in the Constitution remain illusory. Therefore, the approach of the courts must be compatible with the constitutional philosophy of which the directive principles of State policy constitute an integral part and justice due to the workman should not be denied by entertaining the specious and untenable grounds put forward by the employer—public or private." 28. In view of the above discussion, the writ petition W.P.No.18518 of 2010 will stand partly allowed. The Award passed by Industrial Tribunal in I.D.No.21 of 2004 dated 13.04.2006 is modified with a direction to the respondent Sugar Mill to re-employ the members mentioned in Annexure II to the order of reference dated 28.04.2004 from the time the crushing operation starts in the factory with similar terms and conditions as are available in the other corresponding Sugar Mills. No costs. Consequently, connected miscellaneous petition is closed. 29. W.P.No.27494 of 2010 is concerned, the members of the petitioner Union have accepted the terms of VRS. After settling of their terminal benefits, they have gone out of the Mill. Subsequently, it is claimed that it was due to their continuous efforts has resulted in the Government accepting their demand for revival of the Mill. The Government as per the assurance given by the Hon'ble Chief Minister issued G.O.Ms.No.110 Industries https://hcservices.ecourts.gov.in/hcservices/ Department, dated 07.08.2010 for reviving the Mill. But in paragraph 5(6) and 6 of the GO, it was directed as follows:- "5(e)The Commissioner of Sugar is requested to issue suitable instructions to the Madurantakam Co- operative Sugar Mills Ltd. to re-deploy the employees from other sugar mills where there are excess staff/workers instead of going for 100% fresh recruitment. 6. The Commissioner of Sugar is also requested to take early steps for the re-opening of the Madurantakam Co-operative Sugar Mills Ltd., as per the above instructions of the Government." 30. The petitioner Union have not challenged the said Government Order in proposing to run the Mill with the assistance of employees drawn on deputation from the other Sugar Mills. The members of the Union have not established their right to seek for employment under the I.D.Act. Their service have already come to an end by the acceptance of VRS. Their challenge to the tender notification is pursuant to the Government Order reviving the Mills. A reading of the tender notification itself showed it is only for the purpose of overhauling the machineries and upkeeping of the buildings so as to start the crushing operation for the year 2011-2012. The nature of work entrusted does not indicate that any of the workers who were employed earlier were doing similar work. In any event, the workmen represented by the petitioner Union