Company Law; Hindustan Cables Vs. Tapan Kumar Sarkar [Calcutta High Court, 17-08-2016]

Industrial Employment (Standing Orders) Act, 1946 – Industrial Disputes Act, 1947 –  S. 2 (p) – ‘Settlement’ – If a contractual term is violated ordinarily the remedy is not a writ petition. Hence, in the present case, even if the writ petitioners base their claim on the superannuation clause in the settlements arrived at by and between them and the management, writ petition would not be the remedy.

In the High Court At Calcutta

Civil Appellate Jurisdiction

Coram : The Hon’ble The Chief Justice Manjula Chellur & The Hon’ble Justice Arijit Banerjee

Judgment On : 17.08.2016

MAT 1446 of 2015 CAN 9278 of 2015 M/s. Hindustan Cables Ltd. & Ors. -Vs.- Tapan Kumar Sarkar & Ors. And MAT 1860 of 2015 CAN 11925 of 2015 CAN 11926 of 2015 Union of India -Vs.- Tapan Kumar Sarkar & Ors. For the appellants : Mr. Partha Sarathi Sengupta, Sr. Adv. Mr. P. B. Choudhury, Adv. For the respondents : Ms. Debjani Sengupta, Adv. Mr. Sobhan Majumdar, Adv. Ms. Tiyasa Banerjee, Adv. Ms. Shreya Bhatterjee, Adv. For the Union of India : Mr. Sajal Kanti Bhattacharyya, Adv.

Arijit Banerjee, J.

(1) Both the appeals mentioned above arise from same judgment and order dated 19 June, 2015 passed by the Learned Single Judge whereby WP 3572 (W) of 2012 was allowed. Since both the appeals involve same set of facts, the same are taken up together for hearing and disposal by this judgment.

(2) The writ petitioners are employees or ex-employees of the appellant company at the Rupnarainpur Unit of the Company. Contending that their age of retirement is 60 years, the writ petitioners approached the Learned Single Judge alleging that the appellant company has not been making payment of their salaries and other allowances after attaining the age of 58 years though they continued or are continuing in service till the age of 60 years. The writ petitioners accordingly, prayed for a writ in the nature of mandamus commanding the respondent company and the Union of India to release their salaries and allowances and further pay their monthly salary till their superannuation and directing the respondents to release retiral benefits of the petitioners who have superannuated. The Learned Judge allowed the writ petition. The operative portion of the judgment of the Learned First Court is as follows:-

“I thus, allow the writ petition and direct the respondent company to take necessary steps for payment of admissible dues to the petitioners who have already retired from service and to release the unpaid salaries and allowances to the petitioners who are still in service and to go on paying the same till they attain the age of superannuation. Such steps are to be taken within a period of ten weeks from the date of the communication of the order.

Needless to mention, if necessary, the respondent no. 1 shall provide the requisite financial assistance to the respondent company for making necessary payment to the writ petitioners in terms of this order if the respondent no. 1 is otherwise obliged to bear the financial burden of the company in this regard.”

Challenging the aforesaid judgment and order the appellant company and the Union of India have filed separate appeals which are before us.

Submission on behalf of the Hindustan Cables Ltd. (appellant No. 1 in MAT no. 1446 of 2015) (3) Appearing on behalf of the Hindustan Cables Ltd. (in short the ‘Company’), Mr. Partha Sarathi Sengupta, Learned Senior Counsel urged a preliminary point of maintainability of the writ petition. He submitted that the writ petitioners have filed the instant proceeding to enforce a money claim simpliciter. Mr. Sengupta then submitted that a contractual right and that too a plain and simple money claim cannot form the basis of a writ petition. In this connection he relied on a decision of the Hon’ble Supreme Court in the case of

M/s. Burmah Construction Company v. The State of Orissa, AIR 1962 SC 1320

wherein at paragraph 6 of the judgment the Hon’ble Apex Court observed that the High Court normally does not entertain a petition underArt. 226 of the Constitution to enforce a civil liability arising out of a breach of contract or a tort to pay an amount of money due to the claimant and leaves it to the aggrieved party to agitate the question in a civil suit filed for that purpose. However, an order for payment of money may sometimes be made in a petition under Art. 226 against the State or against an officer of the State to enforce a statutory obligation. He also relied on a decision of the Hon’ble Supreme Court in the case of

Suganmal v. State of Madhya Pradesh, AIR 1965 SC 1740

(4) Mr. Sengupta then submitted that as per the Standing Orders, 1964 issued under the

Industrial Employment (Standing Orders) Act, 1946

which apply to the company and its employees/workmen, every employee shall retire from service on attaining the age of 58 years. Extension for two years in all, but not more than one year at a time may be given at the discretion of the Management (clause 4(i)). He then referred to the Standing Orders, 1977 and submitted that the same have no provision with respect to superannuation. He submitted that in the absence of superannuation clause, the 1977 Standing Orders are not valid. Hence, 1964 Standing Orders continued to remain in force. He contended that even assuming that the 1977 Standing Orders are valid, since the same do not contain a superannuation clause, the clause under 1964 Standing Orders would prevail.

In this connection Mr. Senguapta referred to Sec. 2(g) and Sec. 3 of the Industrial Employment (Standing Orders) Act, 1946 and also to the Schedule to the said Act. Sec. 2(g) of the said Act defines ‘Standing Order’ as rules relating to matters set out in the Schedule. Sec. 3(1) provides that within six months from the date on which the 1946 Act becomes applicable to an industrial establishment, the employer shall submit to the Certifying Officer five copies of the draft Standing Orders proposed by him for adoption in his industrial establishment. Sec. 3(2) of the Act stipulates that provision shall be made in such draft Standing Orders of every matter set out in the Schedule which may be applicable to the industrial establishment and where model Standing Orders have been prescribed, shall be, in so far as practicable, in conformity with such model. Clause 11 of the Schedule to the 1946 Act reads as ‘in every matter in which may be prescribed’. Clause 2A of the Bengal Industrial Employment (Standing Orders) Rules, 1946 provides that matters relating to payment, transfer, over-time and superannuation shall be additional matters to be included in the Schedule to the Industrial Employment (Standing Orders) Act, 1946 and shall be treated as item nos. 12 to 15 of the said Schedule. Mr. Sengupta submitted that on a conjoint reading of the aforesaid provisions, it follows that all Standing Orders must contain a clause relating to superannuation. Otherwise it is not a Standing Order at all. Since the 1977 Standing Orders do not contain a superannuation clause, it is not a valid Standing Order.

(5) Learned Counsel then referred to a Tripartite Agreement dated 7 June, 1974 entered into by and between the Management of the Company and the Four Unions of the Company subject to the approval of the Addl. Labour Commissioner and Conciliation Officer. He submitted that although clause 12 of the said agreement provides that subject to the approval of the Board of Directors, the employees will retire on attaining the age of 60 years instead of attaining 58 years of which, this purported increase in the age of retirement was never made part of the Standing Orders. He submitted that in case of conflict between Standing Orders and Private Contract with regard to the service conditions, Standing Orders would prevail. In this connection he relied on a decision of the Hon’ble Supreme Court in the case of