High Court · 2025

W.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 2018IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 28.02.2025CORAMTHE HONOURABLE MR.JUSTICE M.DHANDAPANIW.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 20181. C. Karthikeyan...Petitioner in W.P. 23555 of 20182. C. Baskaran ...Petitioner in W.P. 20088 of 20183. C. Muruganantham...Petitioner in W.P. 20089 of 20184. M. Suresh...Petitioner in W.P. 20090 of 20185. M. Gopalakrishnan...Petitioner in W.P. 20092 of 20186. P. Chellavelu...Petitioner in W.P. 20093 of 20187. T. Mahendran...Petitioner in W.P. 20094 of 20188. S.Sarathbabu...Petitioner in W.P.20095 of 20189. B.Balasubramanian...Petitioner in W.P. 20096 of 2018Vs.1.The Management ofM/s. Sundaram Auto Components Ltd.,Rubber Division,Belagondapalli,Hosur,Krishnagiri District.2. The Management of1/8 https://www.mhc.tn.gov.in/judis W.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 2018Mega Rubber Technologies ltd.,Belagondapalli,Hosur,Krishnagiri District....Respondents in all writ petitionsCommon Prayer: Petitions filed under Article 226 of the Constitution of India to issue a Writ of certiorarified Mandamus, calling for the records of impugned common award passed in I.D.Nos. 4, 6, 7, 8, 10, 11,13, 14, and 15 of 2014, dated 24.10.2017 which was communicated vide letter dated 16.03.2018 by the Presiding Officer, Labour Court, Salem, and quash the same, consequently direct the respondents 1 and 2 to reinstate the petitioner into service with with all service benefits including continuity of service and pass orders.For Petitioners : Mr. Balan Haridass For M/s M.R.Jothimanian in all Writ PetitionsFor Respondents:R1- Mr.Sanjay Mohan For S. Ramasubramaniam and Associates M/s. V.Pavithra for M/s. Srimathi for R2 in all Writ Petitions COMMON ORDERThe issue involved in all these writ petitions is whether a retrenched employee, as a matter of right, could demand employment with continuity of service in the new management to which the appreciation of the erstwhile company has come.2/8 https://www.mhc.tn.gov.in/judis W.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 20182. The petitioners herein are employed with the first respondent management. According to the petitioners, the first respondent is a sister concern of the TVS Group of companies. The first respondent was making huge profits by doing production of rubber and it allied products used in the automobiles.3. According to the petitioners all of a suffen during April 2013 they were orally terminated by the first respondent stating taht the management has changed hands and now the second respondent is at helm of affairs. When the petitioners had demanded job the first respondent is stated to have directed the petitioners to approach the second respondent and make a request there. It is the case of the petitioners that the second respondent did not consider their request favourably.4. Aggrieved, the petitioners raised an industrial dispute which was referred to conciliation officer and the conciliation proceedings failed and a failure report was given. Armed with the failure report, the petitioners raised their individual industrial dispute. 3/8 https://www.mhc.tn.gov.in/judis W.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 20185. In all, twelve industrial disputes were raised. The Labour Court by way of order dated 24.10.2017 partly allowed the disputes by granting retrenchment compensation; one month salary ; Rs.1,00,000/- towards ex-gratia and granted interest at the rate of 9%. 6. The Labour Court has negatived the prayer for reinstatement along with backwages. Aggrieved by the same, the present writ petitions have been filed.7. Having gone through the impugned order and having heard the learned counsel on either side at length, this Court is called upon to verify whether the claim of the petitioners for reinstatement of second respondent company with continuity of service is justified.8. Admittedly, the first respondent has come forward to pay retrenchment compensation. The Labour Court has rightly held taht no compensation would be payable to the employees if the transferee company agrees to observe employees from the transferer company on the same terms and conditions of service and importantly, continuity of service. In other words if the new employer promises same terms and 4/8 https://www.mhc.tn.gov.in/judis W.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 2018conditions of service and also continuity of service then, upon the employee giving concern to become employee of new employer, no compensation is payable as if retrenched. In this case, the second respondents has clearly refused to grant continuity of service to the erstwhile employees of respondents No.1. Rightly, the second respondent cannot also be compelled to observe all the employees of the erstwhile company and grant them continuity of service. The second respondent company may have its own service conditions and fixed qualification that may be necessary for its employees. The said basic qualification may vary with the first respondent in that case it would not be proper to direct the second respondent to observe all the employees of the first respondent.9. Indeed, the first respondent has not sent away it employees empty handed. By virtue of collective bargaining 52 employees were paid ex-gratia of Rs.1,00,000/- each on account of the acceptance of employment with second respondent but without seeking continuity of service. The petitioners herein are harpping on continuity of service in the second respondent company. Therefore, as rightly observed by the Labour Court, the second respondent cannot be directed to observe the 5/8 https://www.mhc.tn.gov.in/judis W.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 2018petitioners with continuity of service. If such a direction is to be given by this Court then, the petitioners would demand backwages if the period of retrenchment and also seek seniority. The demands will be never ending. Therefore, th award passed by the Labour Court deserves no interference by this Court.10. The learned counsel for the petitioner brought to the notice of this Court that the first respondents have paid a sum of Rs.50,000/- as compensation. Considering the fact that the industrial disputes are of the year 2014 and the writ petitions are of the year 2018 and also considering the rate of inflation, this Court is inclined to award a sum of Rs.1,10,000/- to each of the petitioners as compensation.11. In the result, the writ petitions are disposed of with the following directions to the first respondent.(i) The petitioners are entitled to retrenchment compensation as on 31.03.2013. The petitioners are also entitled for one month salary in lieu of notice. (ii) The petitioners are entitled for Rs.1,00,000/- towards ex-gratia.(iii) Above said monetary benefits shall carry interest at the rate of 6/8 https://www.mhc.tn.gov.in/judis W.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 20189% per annum.(iv) In addition, the petitioners are entitled for a sum of Rs.1,10,000/- as compensation, but without interest.(iv) There shall be no order as to costs. 28.02.2025rapSpeaking Order: Yes/ NoIndex: Yes/ No NCC: Yes/ NoToThe Presiding Officer, Labour Court, Salem,M.DHANDAPANI., J.7/8 https://www.mhc.tn.gov.in/judis W.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 2018rapW.P.Nos.20087, 20088, 20089, 20090, 20092, 20093, 20094, 20095, and 20096 of 201828.02.20258/8