The Honourable Mr v. Union of India

appellants was sold to ESAB India Limited on 21.05.1991 and someemployees were transferred on account of the said sale. 4. The first appellants Union objected to the transfer of someemployees as they did not want to serve under the new employer on theground that they were not working in any separate undertaking, but inthe Office/Establishment situated at Chennai which was not a separateundertaking. The first appellants Union also filed a suit inC.S.No.741 of 1991 on the file of this Court and obtained an order ofad-interim injunction in O.A.No.483 of 1991 against transfer ofemployees. The said interim order was also made absolute on25.10.1991. Consequently, the second respondent continued to engagetheir services. Even though, the manufacturing of Medical Equipmentsexisted in the form of a separate factory at Calcutta, it ceased toexist after 1991 and the second respondent company called thebusiness of handling medical equipments etc., as "MEDISHIELD".According to the appellants herein, there was no separate undertakingcalled medical division run by the second respondent company. 5. It is further contended by the appellants/writ petitionersthat the employees are transferred from one post to other anywhere inthe establishment and there is a common seniority list maintained forall the sections and hence, OHMEDA is not an independent division inthe nature of an undertaking and the employees posted at a particulartime in that division do not belong to that division. 6. The order of appointment pertaining to the second appellantsdoes not contain the name of a particular department and thereby hisservice could be utilised in all the departments of the secondrespondent. The second appellants is also an active member of IOLEmployees' Union and is holding the post of Joint Secretary andtherefore, he is the protected workmen under the ID Act. 7. The appellants/ writ petitioners further averred in theiraffidavit that All of a sudden, the second appellants has published aletter dated 30.9.1998 in the Company's Notice Board on 7.10.1998stating that OHMEDA Division has been sold to one DATEX OHMEDA INDIAPVT LTD., - third respondent and that simultaneously, the staff whoare working in the said division are transferred to the thirdrespondent. The second appellants neither sought the consent of theaffected employees nor hold any discussion with the first appellantsUnion before transferring their services to the third respondent andthe decision of the second appellants was an unilateral one and ithas been exercised in an arbitrary manner affecting the rights andprivileges enjoyed by the employees. The appellants/writ petitionersfurther contended that the second appellants in all fairness, shouldhave resorted to the benevolent provision contained under Section 25-N of the Industrial Disputes Act and thereby they should have drawn https://hcservices.ecourts.gov.in/hcservices/ up a seniority list and the second appellants being the senior most,ought not to have been retrenched. The second respondent in order tocircumvent the said provision, had resorted to Section 25-FF of theIndustrial Disputes Act and hence the said provision is in violationof Article 14 and 21 of the Constitution of India. The services ofthe second appellants with the second respondent entitled him withpension and higher rates of bonus etc., which will not be availablein the event of the transfer of his services to the third appellants.Since the second appellants is a large establishment more than 100workers, they are entitled to the protection of Chapter V-B of theIndustrial Disputes Act, which prohibits lay off, retrenchment andclosure without prior permission of the Government. The secondrespondent who is the public limited company of repute, whereas thethird respondent company is a private limited company, whosecredentials are not known to the appellants/writ petitioners. Allworkers who were former members of the appellants Union and who weretransferred to the services of the third respondent have not beenpaid Rs.160/- per month towards health and hygiene and prosperitysharing amount for the month of October 1998 and they were alsodenied canteen facility. 8. Therefore, the appellants/writ petitioners filed a writ ofdeclaration to declare that Section 25-FF of the Industrial disputesAct, 1947 is unconstitutional to the extent that it does not requirethe consent of workmen for transfer of his services and the transferof an undertaking and consequently direct the second respondent tocontinue the services of the second appellants/second writ petitionerin service from 1.10.1990 and pay him all the wages etc., or in thealternative, prayed for the issuance of the writ of declaration todeclare that the sale effected by the second respondent in favour ofthe third respondent vide notice dated 30.9.1998 does not constitutethe transfer of undertaking as per the proviso to Section 25-FF ofthe Industrial Disputes Act 1947 and consequently directed the secondrespondent to continue the services of the second appellants in thesame manner as before 1.10.1998 without any interruption and pay thearrears of wages and other benefits. 9. The interim orders sought for by the appellants/writpetitioners were not granted. The second appellants agreed to jointhe services of the third respondent without prejudice to hiscontentions raised in the writ petition. The third respondent sent acommunication dated 8.6.1999 to the second appellants herein refusinghim to join duty as he had forfeited the right to be in employmentwith them. 10. This Court vide order dated 1.10.1999 by way of an interimmeasure directed the second respondent herein to pay the secondappellants a sum of Rs.6,400/- per month from 1.11.1999 for the https://hcservices.ecourts.gov.in/hcservices/ reason that the third respondent herein had refused to provide himwith employment. The appeal preferred by the management against thesaid order in writ appeal No.2314 of 1999 was dismissed on 21.1.2000and thereby confirming the above said interim order. 11. The second respondent has filed its counter affidavit. It iscontended in the counter affidavit that a writ is not maintainableagainst the second respondent as it is only a public limited companyand not performing any public duty. Since the issues raised by theappellants herein require adjudication of disputed questions of fact,they are not entitled to invoke the extraordinary jurisdiction ofthis Court under Article 226 of the Constitution of India. 12. As regards the transfer of undertaking in favour of the thirdrespondent is concerned, the second respondent contended that it hasa separate division to look after the sale of Health Care Equipmentsunder the name and style of " OHMEDA" and its activities are totallydifferent and is severable from other units of the shops orundertaking. The employees engaged in "OHMEDA" division areexclusively doing work which are related with sales and service ofthe products of "OHMEDA" division and the said division is dealingwith Health Care products in a separate business establishment. Itis stressed by the second respondent that "OHMEDA" division is aseparate undertaking and its activities are severable from otherunits of the shops and sale of the said division will not affect theworking of the main activities of the second respondent whichmanufacturing industrial and medical gas. 13. The second respondent further contended that the "OHMEDA"Health Care product division has been transferred from the secondrespondent to the third respondent not only in India, but through outthe world and in this country, the transfer of undertaking took placeunder the agreement dated 24.9.1998 with effect from 1.10.1998. Inpursuant to the said decision, the staff belong to the firstappellants union including the second appellants stood transferred tothe third respondent and in all, 15 officials became employees of thethird respondent in the entire South Zone and all of them, have beenexclusively work in the "OHMEDA" division and they have beencontinuous service carrying out of the work of the said divisionimmediately before such transfer. 14. The second respondent also contended in the counter that theservices of the second appellants and other officials were agreed tobe taken by the third respondent without any break or interruption intheir service on the same terms and conditions including retirementbenefits and it is not in any way less favourable than thoseapplicable to them immediately before the transfer of undertaking.On and from 7.10.1998 onwards, the second appellants became employeesof the third respondent by virtue of transfer of undertaking. https://hcservices.ecourts.gov.in/hcservices/

15. With regard to the Constitutional validity of Section 25-FFof the Industrial Disputes Act, 1947, the second respondent contendedthat the Legislature does not curb the right of the employer toretrench, terminate or close an undertaking but on the contrary, hasimposed certain restrictions which are reasonable and as contemplatedunder Article 19(6) of the Constitution of India. A provision hasalso been made for payment of compensation to workmen as and whenthey are retrenched in the event of transfer of undertaking. In thecase on hand, the service of the second appellants and others havenot been terminated but their service conditions have been protectedby the third respondent. 16. The second respondent contended that there has been a bonafide transfer of undertaking by "OHMEDA" division and such transferof undertaking or sale of undertaking is recognised in law andSection 25-FF came to be incorporated in the Industrial Disputes Act,taking into consideration the interest of the workmen. That apart,sale or transfer of an undertaking, cannot be questioned on theground it amounts to change in service conditions as contemplatedunder Section 9A of the Industrial Disputes Act. Therefore, for thesaid reasons, the second respondent prayed for the dismissal of thewrit petition. 17. The learned Judge, after taking into consideration theaverments made in the writ petition and the counter affidavit of thesecond respondent and also the judgments reported in :(1) R.S.Madho Ram & Sons (Agencies) v. ITS Workmen 1964(1) L.L.J. page 213) (2) P.K.P. Bidi Factory v. O.L.Thenge (A.I.R.1970 S.C. page823), (3) J.N.U. v. DR.K.S.J. Awatkar & others (A.I.R.1989S.C. 1577 = 1989 (2) L.L.J. page 586) and (4) Voltal Volkart Employees Union v. Voltas Ltd.,(1999 (4) L.L.N. page 1107), held that Section 25-FF safeguards the interest of the workmen andthat the consequential relief of directing the second respondent tocontinue the services as it had been prior to 1.10.1998 and thatconsequential reliefs cannot be granted. The learned Judge for thesaid reasons, has dismissed the writ petition and the writpetitioners aggrieved by the same, had preferred this writ appeal. 18. Heard Mr.N.G.R.Prasad, learned counsel appearing for theappellants and Mr.K.Mohanamurali, learned Senior Central GovernmentStanding Counsel appearing for the first respondent and https://hcservices.ecourts.gov.in/hcservices/ Mr.A.L.Somayaji, learned senior counsel appearing for M/s. Gupta andRavi, for the second respondent and Mr.V.Karthik, for Mr.T.S.Gopalan, and Co., learned counsel appearing for the thirdrespondent.19. As regards the maintainability of the writ petition, it hasbeen contended that the writ petition was filed in the year 1998 andthe second appellants herein had superannuated in August 2003, hadhe been continued in the service of the second respondent and now thesecond appellants is aged about 65 years. Therefore, at thisdistance of time, it would be wholly unjustifiable to direct thesecond appellants to avail the alternative remedy. 20. The learned counsel appearing for the appellants heavilyplaced reliance upon the judgment of the Hon'ble Supreme Court ofIndia, reported in 2008(1) L.L.N. 1(SC) - BCPP Mazdoor Sangh andanother v. N.T.P.C. and others. 21. The facts of the said case are:- that the members of BCPPMazdoor Sangh are employees recruited by National Thermal PowerCorporation (NTPC) by calling for list of names from the EmploymentExchange and were appointed by following the procedure. Steps werebeing taken for transferring them to Bharat Aluminium Company Limited(BALCO) which was originally a public sector undertaking under theGovernment of India. Subsequently, in pursuant to the policy ofdisinvestment, the entire management became vested with M/s. Sterliteunder agreement dated 20.6.2002, with effect from 1.7.2002. TheUnion aggrieved by the said decision of transfer from public sectorundertaking to private management, had challenged the same by filingwrit petition before the High Court of Chhattisgarh and they mainlyprayed for an order declaring that Clause 8.2 and 16.3 of theagreement with Sterlite is illegal, arbitrary and unenforceableagainst them who are non-executive workers as it unilaterally changesthe service conditions of all those employees who are not party tothe agreement. The Union also sought for an order of injunctionrestraining the management from enforcing the above said clauses.The respondents filed counter stating among other things raising themaintainability of the writ petition as it involves interpretation ofcontractual rights between the parties. It is further contended thatNTPC is merely an agent of BALCO on a specific power of attorneygiven to them and the ownership of BCPP belongs to BALCO.Recruitment was given pursuant to an agreement exclusively for BCPPwith specific undertaking from the non-executive employees and theyknow pretty well the meaning of undertaking and therefore, have noright to question the agreement between BALCO and NTPC. The offer ofappointment as well as the undertaking given by the employeesspecifically bring out the above fact and besides, the operation andmaintenance agreement signed between the NTPC and BALCO makes it https://hcservices.ecourts.gov.in/hcservices/ clear that the recruitment made by NTPC is specifically for BCPP andin the event of transfer of operation and maintenance of BCPP to anyother agency, the services of such employees will be transferable tothe successor agency. Based on the said agreement, variousadministrative actions were taken and which were taken only onbehalf of BALCO and not for NTPC. It is further contended by themanagement in the said case that once BCPP owned by BALCO is takenover by BALCO, the entire non-executive staff of BCPP will continueto remain in BCPP under the management of BALCO in terms of Clauses8.0 and 16.3 of the agreement and once the plant is taken over, ifthe non-executive employees are not going to BALCO, they will becomesurplus in the hands of NTPC and therefore, NTPC will left with noother option except to retrench their services. 22. The High Court of Chhattisgarh after taking intoconsideration the rival contentions, held that the writ petitionfiled by the employees are maintainable and the terms and conditions,more particularly, Clauses 8.0 and 16.3, are accepted by theemployees and adhered the stand taken by the management. Therefore,it dismissed all the writ petitions. Hence, the matter was taken byway of appeal to the Hon'ble Supreme Court of India. The Hon'bleSupreme Court of India uphold the view of the High Court ofChhattisgarh in so far as the maintainability of the writ petition,On the factual aspects, the Hon'ble Supreme Court of India held thatthe bipartite agreement between NTPC and BALCO was entered into on22.05.1990 and that the appointments of 236 employees were made priorto the said date and at the time of recruitment and appointment madeby NTPC, no agreement between NTPC and BALCO was in existenceempowering NTPC to make recruitment and appointment on behalf ofBALCO. Hence, the Hon'ble Supreme Court of India held that as perClause No.21.0 of the agreement, the effective date and duration ofagreement with effect from 29.6.1987, is contrary to the provisionsof Section 23 of the Indian Contract Act and also in violation ofArticle 14 of the Constitution of India. 23. The Hon'ble Supreme Court of India, further held that Clause14.0 of the above said agreement is also against the public policyand contrary to the provisions of Section 23 of the Indian ContractAct as well as violation of Article 14 of the Constitution of Indiafor the reason that undue influence was exercised by NTPC managementand the selected candidates exhaust the terms and conditionsstipulated therein. As regards the absence of tripartite agreement,it was held in the said decision that in order to appoint theappellants, there must be a tripartite agreement and in the absenceof the same, the transfer from one employment to another cannot beeffected. It has been further found by the Hon'ble Supreme Court ofIndia that prior to such decision, the employees have not been heardalso and therefore the action of the management is an infringement of https://hcservices.ecourts.gov.in/hcservices/ Article 14 of the Constitution of India. Therefore, for the saidreasons, the Hon'ble Supreme Court of India had set aside thedecision of the High Court of Chhattisgarh and allowed the appealfiled by the Union. 24. The learned counsel appearing for the appellants submittedthat the transfer of the second appellants from the service of thesecond respondent to third respondent was not on the same terms andconditions as he will not get pension in the new employer namelythird respondent and that he will lose the benefit of profit sharingscheme, which the second appellants was getting while he was inservice of the second respondent as the third appellants is not amanufacturing concern. Moreover, the second appellants will lose thecanteen facility available in the second respondent and also lose thebenefit of educational scholarship for his wards. The secondappellants will also to be deprived of medical reimbursement ofRs.600/- per year for himself and his wife and also Mediclaim policybenefit available till life time. 25. The learned counsel appearing for the appellants furthercontended that the consent of the second appellants has not beentaken prior to his transfer. In support of his submissions, thelearned counsel appearing for the appellants has drawn the attentionof this Court to the transfer agreement dated 24.9.1998 and moreparticularly, to clause No.10.01 which specifically provides that thepurchaser will take into services all the employees, who haveaccepted employment with the new employer. Reliance was also placedupon the judgment of the Industrial Tribunal Mumbai, in Complaint(ULP) No.645 of 1998 between IOL Employees' Union, Mumbai v. BOCIndia Limited (second respondent), wherein it has been held that thefour concerned workmen whose services is transferred to Datex Ohmedacannot be said legal and proper and the Tribunal ultimately held thatthe second respondent herein is guilty of unfair labour practice andfurther directed not to transfer any of the four concerned workmenworking in Ohmeda division of the second respondent to other newcompany Datex Ohmeda India Limited (third respondent) and that in theevent of failure to continue their services, the second respondentmanagement is liable to pay retrenchment compensation as stipulatedunder Section 25F of the Industrial Disputes Act. 26. The learned counsel appearing for the appellants alsocontended that the transfer of Ohmeda division in favour of the thirdrespondent by the second respondent in any event cannot be construedas a transfer of entire undertaking and only such an event, Section25FF of the Industrial Disputes Act will apply. Ohmeda division hasbeen transferred by the second respondent in favour of the thirdrespondent and admittedly, the petitioner was originally appointed asa typist in IOL, it later became BOC in the year 1995 and till https://hcservices.ecourts.gov.in/hcservices/ December 1998 was in the services of the second respondent and afterthe formation of the Health Care products division, promoted andposted as Stenographer Grade I in the said division and in the year1995, the Health Care division was renamed as Ohmeda division and inthe year 1996 the second appellants was classified as Assistant. Theabove facts according to the learned counsel appearing for theappellants, would imply that the employees are transferable from onepost to another and a common seniority was maintained for all thesections. It is once again stressed by the learned counsel appearingfor the appellants that the Ohmeda division is not an independentdivision and it forms part of the second respondent and admittedlynot the entire management and affairs of the second respondentcompany was transferred in favour of the third respondent but onlyOhmeda division. It is vehemently contended by the learned counselappearing for the appellants that the second appellants was notexclusively appointed in Health Care division and later became Ohmedadivision and merely he happen to work at the relevant point of time,it cannot mean that he is in permanent service of the Ohmedadivision. There is no factual disputes involved as the secondrespondent failed to produce any material before this Court tosubstantiate their claim that Health Care division was a separateundertaking. 27. As regards the validity of Section 25FF of the IndustrialDisputes Act, it is contended by the learned counsel appearing forthe appellants that the said provision deprives the second appellantsof the benefit of compensation as if retrenchment and the same wouldbe unreasonable and arbitrary and also in gross violation of Section23 of the Indian Contract Act. Alternatively, the learned counselappearing for the appellants has submitted that there is no transferof undertaking and consequently Section 25FF of the IndustrialDisputes Act has no application on the case on hand and it is to bedeclared that the second appellants continued to be in the service ofthe second respondent till the date of his superannuation.Therefore, the learned counsel praying for set aside of the orderpassed in dismissing the writ petition and allowing of this writappeal. 28. Per contra, Mr.A.L.Somayaji, learned senior counsel appearingfor the second respondent has submitted that the second portion ofthe prayer namely directing the second respondent to continue theservices of the second appellants in service from 1.10.1998 andpaying him all the wages etc., is not maintainable as no writpetition will lie against the private body in the absence ofdischarge of any public function/duties. The remedy if any availableto the appellants to invoke the provisions of the Industrial DisputesAct and they cannot maintain the writ petition. That apart, theissue pertaining to the interpretation of the terms of transfer of https://hcservices.ecourts.gov.in/hcservices/ undertaking it is seriously disputed by the respondents 2 and 3 andon that ground also the writ petition is not maintainable and it ismisconceived. 29. The learned senior counsel appearing for the secondrespondent would further contend that the question regarding theHealth Care business is part of undertaking of the second respondentor not is a mixed question of law and facts and the same cannot beadjudicated by this Court in exercise of jurisdiction under Article226 of the Constitution of India. The Health Care division is aseparate undertaking as it does not involve any manufacturing processand the second respondent company even as per the admission of theappellants is manufacturing medical industrial gases. The functionof Health Care division and later Ohmeda division is separate anddistinct from the activities of the second respondent and thereforethe transfer in favour of the third respondent amounts to transfer ofundertaking as a whole. 30. With regard to the validity of Section 25FF of the IndustrialDisputes Act, learned senior counsel contended that the deemedretrenchment contemplated under the said provision is by agreementbetween the parties or by operation of law. As per the proviso toSection 25FF, of the Act that if the three conditions specified inthe proviso are satisfied, there is no termination of service eitherin fact or in law and so there is no scope for the payment of anycompensation. Admittedly, the service conditions of the secondappellants and others who have been transferred to the thirdrespondent, were protected and similar benefits have been provided tothem and the contention of the appellants that the service conditionswith the third respondent are not similar to them of the secondrespondent is not correct and dispute with regard to the parity ofservice conditions can be adjudicated only before the appropriateforum and not before this Court. The learned senior counselappearing for the second respondent has also took this Court throughthe averments in the counter affidavit filed by the second respondentin the writ petition. 31. The learned senior counsel appearing for the secondrespondent in support of his submissions placed reliance upon thefollowing judgments:-(1) 1960 (1) SCR 703 = 1960 SC 56 = 1960 (1) LLJ 1 - AssociatedCement Companies Ltd., vs. Workmen, wherein the proper tests indetermining what is meant by "one establishment" have been laid downand it has been held as follows:- " The Act not having prescribed any specific tests fordetermining what is ‘one establishment’, we must fall back https://hcservices.ecourts.gov.in/hcservices/ on such considerations as in the ordinary industrial orbusiness sense determine the unity of an industrialestablishment, having regard no doubt to the scheme andobject of the Act and other relevant provisions of the MinesAct, 1952, or the Factories Act, 1948. What then is ‘oneestablishment’ in the ordinary industrial or business sense?The question of unity or oneness presents difficulties whenthe industrial establishment consists of parts, units,departments, branches etc. If it is strictly unitary in thesense of having one location and one unit only, there islittle difficulty in saying that it is one establishment.Where, however, the industrial undertaking has parts,branches, departments, units etc. with different locations,near or distant, the question arises what tests should beapplied for determining what constitutes ‘oneestablishment’. Several tests were referred to in the courseof arguments before us, such as, geographical proximity,unity of ownership, management and control, unity ofemployment and conditions of service, functionalintegrality, general unity of purpose etc. To most of thesewe have referred while summarising the evidence of MrDongray and the findings of the Tribunal thereon. It is,perhaps, impossible to lay down any one test as an absoluteand invariable test for all cases. The real purpose of thesetests is to find out the true relation between the parts,branches, units etc. If in their true relation theyconstitute one integrated whole, we say that theestablishment is one; if on the contrary they do notconstitute one integrated whole, each unit is then aseparate unit. How the relation between the units will bejudged must depend on the facts proved, having regard to thescheme and object of the statute which gives the right ofunemployment compensation and also prescribesdisqualification therefor. Thus, in one case the unity ofownership, management and control may be the important test;in another case functional integrality or general unity maybe the important test; and in still another case, theimportant test may be the unity of employment. Indeed, in alarge number of cases several tests may fall forconsideration at the same time. The difficulty of applyingthese tests arises because of the complexities of modernindustrial organisation; many enterprises may havefunctional integrality between factories which areseparately owned; some may be integrated in part with unitsor factories having the same ownership and in part withfactories or plants which are independently owned. In themidst of all these complexities it may be difficult todiscover the real thread of unity. In an American decision https://hcservices.ecourts.gov.in/hcservices/ (Donald L. Nordling v. Ford Motor Company 1) there is anexample of an industrial product consisting of 3800 or 4000parts, about 900 of which came out of one plant; some camefrom other plants owned by the same Company and still otherscame from plants independently owned, and a shutdown causedby a strike or other labour dispute at any one of the plantsmight conceivably cause a closure of the main plant orfactory.Fortunately for us, such complexities do not presentthemselves in the case under our consideration. We do notsay that it is usual in industrial practice to have oneestablishment consisting of a factory and a mine; but wehave to remember the special facts of this case where theadjacent limestone quarry supplies the raw material, almostexclusively, to the factory; the quarry is indeed a feederof the factory and without limestone from the quarry, thefactory cannot function. Ours is a case where all the testsare fulfilled, as shown from the evidence given on behalf ofthe appellants to which we have earlier referred. There areunity of ownership, unity of management, supervision andcontrol, unity of finance and employment, unity of labourand conditions of service of workmen, functionalintegrality, general unity of purpose and geographicalproximity. We shall presently deal with the legaldifficulties at which the Tribunal has hinted and which havebeen elaborated by learned counsel for the respondent. Butapart from them, the only fair conclusion from the factsproved in the case is that the Chaibasa Cement Worksconsisting of the factory and the limestone quarry form oneestablishment. The existence of two sets of Standing Ordersand a separate attendance register for the limestone quarryhave already been adverted to. They have been sufficientlyexplained by Mr Dongray, particularly the existence of twosets of Standing Orders by reason of the statutoryrequirement of approval by different authorities — one setby the Labour Commissioner, Bihar, and other by the relevantCentral authority." Ultimately, the Hon'ble Supreme Court of India in the said decisionheld that if the statute itself says what is one establishment, thenthere is no difficulty. If the statute does not, however, say whatconstitutes one establishment, then the usual tests have to beapplied to determine the true relation between the parts, branchesetc., namely, whether they constitute one integrated whole or not.No particular test can be adopted as an absolute test in all cases ofthis type and the word 'establishment' is not to be given the https://hcservices.ecourts.gov.in/hcservices/ sweeping definition of one organisation of which it is capable, butrather is to be construed in the ordinary business or commercialsense. 31(2) In AIR 1963 SC page 1489 (Constitution Bench) - AnakapalleCo-operative Agricultural and Industrial Society vs. Workmen andothers, the issue regarding sale of Industrial concern and its effectof services of workmen of the transferor concern vis-a-vis Section 2(oo) and 25FF of the Industrial Disputes Act came up forconsideration and it has been held that the claim for compensation byworkmen lies against the transferor concern only and not against thetransferee concern. 31(3) In 1964 (1) LLJ page 366 - R.S.Madho Ram & Sons (Agencies)(Private) Ltd., and another vs. Its workmen, construction of Section25FF of the ID Act 1947 came up for consideration and the Hon'bleSupreme Court of India placed reliance upon the Constitution Benchjudgment of Anakapalle Co-operative Agricultural and IndustrialSociety vs. Workmen and others, (AIR 1963 SC 1489) and held thatprovisions of Section 25FF must be determined in the light of thecircumstances of each case and held that the appellants managementcannot claim to be a successor in interest of the firm so as toattract the provisions of Section 25FF of the Industrial Disputes Actand the transfer which has been effected by the firm in favour of theappellants does not amount to transfer of the ownership andmanagement of undertaking. 31(4) 1974(1) LLJ page 499 - Workmen of the Straw BoardManufacturing Company Limited vs. M/s. Straw Board ManufacturingCompany Limited, the Hon'ble Supreme Court of India has taken intoconsideration its earlier decisions which determine the tests fordetermining what is one establishment, and in the light of theprinciples laid down in the earlier cases viz., Associated CementCompanies Limited v. Their Workmen, [1960 - I L.L.J. 703], IndianCable Co. Ltd. v. Its Workmen, [1962-I L.L.J 409], pakshiraja studiosv. Its Workmen, [1961-II LL.J. 330], Pratap Press v. Their Workmen,[1960-I L.L.J 497], South India Mill Owners' Association and othersv. Coimbatore District Textile Workers' Union and others, [1962-IL.L.J 223], and Management of Wenger & Co. v. Their Workmen, (1963)Supp. 2 S.C.R. 863, and considered the issue as to whether the twounits of the company are to be regarded functionally as oneestablishment. It was held that functional integrity will assume anadded significance in the case of closure and ultimately held thatthe concerned Mill was not an independently functioning unit andthere is a functional integrity between two mills and the fact ofownership, supervision and control and other common featuresemphasised do not justify a contrary conclusion. https://hcservices.ecourts.gov.in/hcservices/ 31(5) In 1996(89) FJR page 728 - Employees' Union and others vs.Industrial Tribunal and others, the issue came up for considerationwith regard to the consent of workmen in the case of transfer ofundertaking and it has been held as follows:- " (i) that, after advent of section 25-FF of the IndustrialDisputes Act, 1947, there is no scope for invalidating atransfer of the ownership or management of an undertakingwhether by agreement or by operation of law, on the groundthat consent of the workmen had not been obtained. All thatthe workmen are entitled to is notice and compensation inaccordance with the provisions of section 25-FF of theIndustrial Disputes Act if the workman was in continuousservice for not less than three years and only if theproviso to section 25-FF was not attracted. No consent ofthe workers is necessary for validating the transfer ofownership or management of an undertaking within the meaningof section 25-FF of the Industrial Disputes Act;(ii) that the company, S, as well as the purchaser hadgiven notice to the workmen individually making it clearthat all the three conditions of the proviso to section 25-FF of the Industrial Disputes Act were being complied with;the workmen were assured that the same conditions of servicewould prevail and that even the settlement dated September18, 1989, would be adhered to. The subsequentcorrespondence showed that the workmen never questioned thetransfer on the ground that consent of the workmen was nottaken before effecting the transfer. The relief sought bythe workmen in the writ petition against stoppage of work byV was a clear indicator of the fact that the workmen bytheir positive conduct had consented to the transfer of theundertaking by S to V. In this view of the matter, by theirconduct the workmen had tacitly accepted the change in themanagement;(iii) that, on the facts, the entire aerated waterfactory unit with all the employees, and plant andmachinery, was sold as a going concern to V. Therefore, theaerated water factory functioning at R was a separateundertaking by itself within the meaning of section 25-FF ofthe Act. No remand was, therefore, necessary to establishthis fact;(iv) that the document of transfer showed that it was areal and genuine transfer of undertaking. For a period offive months the workers were in fact working under thepurchaser, V. There was litigation pending between S and V https://hcservices.ecourts.gov.in/hcservices/ which also suggested that the transfer of undertaking wastrue and genuine and could not have been collusive. TheTribunal had also recorded findings to this effect;(v) that the facts showed that both S and V had givennotice to all the workmen which showed that the conditionsmentioned in the proviso to section 25-FF had been strictlyadhered to. Therefore, the workmen had become employees ofV and for any relief with regard to their working conditionshad to look to V alone. Section 25-FF had been fullysatisfied in the sense that the transferor company hadrelieved itself of its obligation vis-a-vis the workmen.The entire obligation had passed on the purchaser, V. Therewas nothing to show that the transfer was illegal orotherwise liable to be set aside. Therefore, the workerswere not entitled to any relief against S. (vi) That the stoppage of work by V was not justifiedand the workers were entitled to all benefits from V underlaw, as if there had been no closure."As per the ratio laid down in the said decision, that after theintroduction of Section 25-FF of the Industrial Disputes Act 1947,there is no scope for invalidating the transfer of the ownership ormanagement of an undertaking whether by an agreement or by operationof law on the ground that consent of the workmen had not beenobtained and no consent of workers is necessary for validating thetransfer of ownership or management of undertaking within the meaningof the said provision. 31(6) In 2005 (1) LLN page 285 (Mad.) (DB) - Management of GEPower Controls Private Ltd., and another vs. Workmen of GE PowerControls Private Ltd. and others, the maintainability of writpetition against a private body pertaining to violation underIndustrial Disputes Act came up for consideration and it has beenheld as follows:-"The language of Art.226 is no doubt very vide. It statesthat a writ can be issued "to any person or authority" and"for enforcement of right conferred by Part III and for anyother purpose." However, the aforesaid language in Art. 226cannot be interpreted and understood literally. We cannotapply the literal rule of interpretation while interpretingArt.226. If we take the language of Art.226 literally itwill follow that a writ can be issued to any private personor to settle even private disputes. If we interpret theword "for any other purpose" literally it will mean that awrit can be issued for any purpose whatsoever, e.g., for https://hcservices.ecourts.gov.in/hcservices/ deciding private disputes, for grant of divorce, successioncertificate etc. Similarly, if we interpret the words "toany person" literally it will mean that a writ can even beissued to private persons. However, this would not be thecorrect meaning in view of various decisions of the SupremeCourt in which it was held that a writ will lie only againstthe State or instrumentality of the State vide Chander MohanKhanna v. National Counsel of Educational Research andTraining [1992 (1) LL.N. 16], Tekraj Vasandhi (alias) K.L.Basandhi v. Union of India [1988 (1) L.L.N. 892], GeneralManager, Kisan Sahkari Chini Mills, Ltd. v. Satrughan Nishad[2003 (4) L.L.N. 1238], Pradeep Kumar Biswas v. IndianInstitute of Chemical Biology and others [(2002(5) S.C.C.111] etc. In General Manager, Kisan Sahkar Chini Mills, Ltd.v. Satrughan Nishad [2003 (4) L.L.N. 1238] (vide supra), theSupreme Court observed that a writ will lie against aprivate body only when it performed a public function ordischarged a public duty. In our opinion the appellants isnot performing a public function nor discharging a publicduty. It is only doing commercial activity. Hence, no writlies against it. The correct interpretation of the aforesaid words inArt.226 is that a writ can ordinarily be issued to a personto whom writs were traditionally issued by British Courts onwell-established principles. Similarly, the words, "for anyother purpose" have to be interpreted in the narrower senseto mean that a writ can be issued for the purpose for whichwrits were traditionally issued by British Courts on well-established principles. The British Courts did notordinarily issue writs to private persons except a writ ofhabeas corpus."In the said decision it has been held that when there is anallegation of violation of some provision of the Industrial DisputesAct, the only remedy for the workmen is to raise an industrialdispute under the Industrial Disputes Act, and get the matterreferred to the Labour Court or Industrial Tribunal. No writpetition will directly be entertained without first approaching theforums under the Industrial Disputes Act. 31(7) In (2006)9 SCC page 488 - Mettur Beardsell Ltd. vs. Workmenand another, the purpose of Section 25-FF of the Industrial DisputesAct has been restated and the Hon'ble Supreme Court of India hastaken into consideration Jawaharlal Nehru University v.Dr.K.S.Jawatkar (1989 supp (1) SCC 679) , Anakapalle Co-operativeAgricultural and Industrial Society vs. Workmen and others - (AIR1963 SC 1489) (Constitution Bench), and also the judgment reported in https://hcservices.ecourts.gov.in/hcservices/ AIR 1964 SC page 645 - R.S.Madho Ram & Sons (Agencies) v. ITS Workmenand approved the decision reported in AIR 1964 SC 645 - R.S.Madho Ram& Sons (Agencies) v. ITS Workmen, wherein it has been held asfollows:- "Again in R.S. Madhoram and Sons Agencies (P) Ltd. v.Workmen4 the position was highlighted as follows: (SCRpp.383-87)“Section 25-FF of the Act provides, inter alia, that wherethe ownership or management of an undertaking istransferred, whether by agreement or by operation of law,from the employer in relation to that undertaking to a newemployer, every workman who satisfies the test prescribedin that section shall be entitled to notice andcompensation in accordance with the provisions of Section25-FF as if the workman had been retrenched. This provisionshows that workmen falling under the category contemplatedby it, are entitled to claim retrenchment compensation incase the undertaking which they were serving and by whichthey were employed is transferred. Such a transfer, in law,is regarded as amounting to retrenchment of the saidworkmen and on that basis Section 25-FF gives the workmenthe right to claim compensation.There is, however, a proviso to this section which excludesits operation in respect of cases falling under theproviso. In substance, the proviso lays down that theprovision as to the payment of compensation on transferwill not be applicable where in spite of the transfer, theservice of the workmen has not been interrupted. The termsand conditions of service are not less favourable aftertransfer than they were before such transfer, and thetransferee is bound under the terms of the transfer to payto the workmen in the event of their retrenchment,compensation on the basis that their service had beencontinuous and had not been interrupted by the transfer.The proviso, therefore, shows that where the transfer doesnot affect the terms and conditions of the employees, doesnot interrupt the length of their service and guarantees tothem payment of compensation, if retrenchment were made, onthe basis of their continuous employment, then Section 25-FF of the Act would not apply and the workmen concernedwould not be entitled to claim compensation merely byreason of the transfer. It is common ground that the threeconditions prescribed by clauses (a), (b) and (c) of theproviso are satisfied in this case and so, if Section 25-FFwere to apply, there can be little doubt that the https://hcservices.ecourts.gov.in/hcservices/ appellants would be justified in contending that thetransfer was valid and the 57 employees can make nogrievance of the said transfer. The question, however, is:Does Section 25-FF apply at all?It would be noticed that the first and foremost conditionfor the application of Section 25-FF is that the ownershipor management of an undertaking is transferred from theemployer in relation to that undertaking to a new employer.What the section contemplates is that either the ownershipor the management of an undertaking should be transferred;normally this would mean that the ownership or themanagement of the entire undertaking should be transferredbefore Section 25-FF comes into operation. If anundertaking conducts one business, it would normally bedifficult to imagine that its ownership or management canbe partially transferred to invoke the application ofSection 25-FF. A business conducted by an industrialundertaking would ordinarily be an integrated business andthough it may consist of different branches or departmentsthey would generally be interrelated with each other so asto constitute one whole business. In such a case, Section25-FF would not apply if a transfer is made in regard to adepartment or branch of the business run by the undertakingand the workmen would be entitled to contend that such apartial transfer is outside the scope of Section 25-FF ofthe Act.It may be that one undertaking may run several industriesor businesses which are distinct and separate. In such acase, the transfer of one distinct and separate businessmay involve the application of Section 25-FF. The fact thatone undertaking runs these businesses would not necessarilyexclude the application of Section 25-FF solely on theground that all the businesses or industries run by thesaid undertaking have not been transferred. It would beclear that in all cases of this character the distinct andseparate businesses would normally be run on the basis thatthey are distinct and separate; employees would beseparately employed in respect of all the said businessesand their terms and conditions of service may varyaccording to the character of the business in question. In such a case it would not be usual to have one musterroll for all the employees and the organisation ofemployment would indicate clearly the distinctive andseparate character of the different businesses. If that beso, then the transfer by the undertaking of one of itsbusinesses may attract the application of Section 25-FF ofthe Act. https://hcservices.ecourts.gov.in/hcservices/ But where the undertaking runs several allied businesses inthe same place or places, different considerations wouldcome into play. In the present case, the muster rollshowing the list of employees was common in regard to allthe departments of business run by the transferor firm. Itis not disputed that the terms and conditions of servicewere the same for all the employees and what is mostsignificant is the fact that the employees could betransferred from one department run by the transferor firmto another department, though the transferor conductedseveral branches of business which are more or less allied,the services of the employees were not confined to any onebusiness, but were liable to be transferred from one branchto another. In the payment of bonus all the employees weretreated as constituting one unit and there was thus boththe unity of employment and the identity of the terms andconditions of service. In fact, it is purely a matter ofaccident that the 57 workmen with whose transfer we areconcerned in the present appeal happened to be engaged inretail business which was the subject-matter of thetransfer between the firm and the company. These 57employees had not been appointed solely for the purpose ofthe retail business but were in charge of the retailbusiness as a mere matter of accident. Under thesecircumstances, it appears to us to be very difficult toaccept Mr Setalvad’s argument that because the retailbusiness has an identity of its own it should be treated asan independent and distinct business run by the firm and assuch, the transfer should be deemed to have constituted thecompany into a successor-in-interest of the transferor firmfor the purpose of Section 25-FF. As in other industrialmatters, so on this question too, it would be difficult tolay down any categorical or general proposition. Whether ornot the transfer in question attracts the provisions ofSections 25-FF must be determined in the light of thecircumstances of each case. It is hardly necessary toemphasise that in dealing with the problem, what industrialadjudication should consider is the matter of substance andnot of form. As has been observed by this Court inAnakapalla Coop. Agricultural and Industrial Society v.Workmen5 the question as to whether a transfer has beeneffected so as to attract Section 25-FF must ultimatelydepend upon the evaluation of all the relevant factors andit cannot be answered by treating any one of them as ofoverriding or conclusive significance. Having regard to thefacts which are relevant in the present case, we aresatisfied that the appellants cannot claim to be asuccessor-in-interest of the firm so as to attract the https://hcservices.ecourts.gov.in/hcservices/ provisions of Section 25-FF of the Act. The transfer whichhas been effected by the firm in favour of the appellantsdoes not, in our opinion, amount to the transfer of theownership or management of an undertaking and so, theTribunal was right in holding that Section 25-FF and theproviso to it did not apply to the present case.”31(8) In (2006)10 SCC page 66 - All India ITDC Workers' Union andothers vs. ITDC and others, the scope of Judicial review in respectof its disinvestment policy pertaining to ITDC hotels came up forconsideration. The Hon'ble Supreme Court of India while deciding thesaid case has considered the Jawaharlal Nehru University v.Dr.K.S.Jawatkar (1989 supp (1) SCC 679) and distinguished the saidcase as there was a purported transfer of the employee from theJawaharlal Nehru University to the Manipur University without hisconsent and admittedly and the JNU did not exercise any control overthe Manipur University and in the case on hand transfer was made fromITDC Ltd. to third respondent company, the shareholding pattern ofthe two companies was exactly the same and therefore it did not makeany difference to the employees, especially, when the scheme ofdemerger itself provides that the employee will continue in serviceof the third respondent with full benefits including continuity inservice. The Hon'ble Supreme Court of India also considered theBALCO Employees' Union case reported in [(2002) 2 SCC 333] andSouthern Structurals Staff Union v. Southern Structurals Ltd reportedin (1994)81 Comp. Cases 389 (Mad) and approved the decision of thisCourt in Southern Structurals Staff Union v. Southern StructuralsLtd reported in (1994)81 Comp. Cases 389 (Mad) (cited supra) andheld as follows:- "The employees have no vested right in the employer companycontinuing to be a government company or 'other authority'for the purpose of Article 12 of the Constitution of India.... The status so conferred on the employees does notprevent the Government from disinvesting; nor does it makethe consent of the employees a necessary precondition fordisinvestment."31(9) In 2007 (1) L.L.N. page 689 - Ram Pravesh Singh and othersvs. State of Bihar and others, the appellants were employees of a co-operative society and whose services have been utilised for betterdistribution of electricity to Rural areas surrounding Patna. Due tothe bad financial position and management of the said society, theState Government took a decision that the assets and liabilities ofthe society should be transferred to the State Electricity Board butnot the services of the employees of the society and despite therequest from the Administrator of the society the Board did notabsorb them in service. The employees filed writ petitions seeking https://hcservices.ecourts.gov.in/hcservices/ direction to the State Electricity Board to absorb them in itsservice ended in dismissal and the appeal was also dismissed and thematter was taken up before the Hon'ble Supreme Court of India and ithas been held that since the State Electricity Board neither enteredinto any contract with the society, nor gave any assurance to thesociety or its employees to absorb the employees of the society intoits service, there is no contractual obligation on the part of theBoard to absorb their services. Therefore, the employees had noright to claim any retrenchment compensation under Section 25FF ofthe Industrial Disputes Act and the did not have any right to claimto be in continuous employment on the same terms and conditions afterthe purchase of the undertaking by the State Electricity Board. 32. Mr.A.L.Somayaji, learned senior counsel appearing for the 2ndrespondent based on the ratio laid down in the above decision, hascontended that the submissions made on behalf of the appellants, lackmerit and prayed for dismissal of the writ appeal. 33. Mr.Karthik, learned counsel appearing for the thirdrespondent has adopted the arguments of learned senior counselappearing for the second respondent and prayed for dismissal of thewrit appeal. 34. Mr.N.G.R. Prasad, learned counsel appearing for theappellants by way of reply, submitted that now the second appellantsis aged about 65 years and at this distant point of time, he cannotbe directed to avail the alternative remedy. The learned counselappearing for the appellants also drawn the attention of this Courtto the judgment reported in 1995-1 L.L.N. 258 (Mad) – MetturChemicals and Industrial Anna Workers Union vs. Chemicals andPlastics India, Ltd. and submitted that the present writ petition ismaintainable as the writ of mandamus is a very wide remedy which mustbe easily available to reach injustice wherever it is found andtechnicalities should not come in the way of granting relief underArticle 226 of the Constitution of India. 35. It is further submitted by the learned counsel appearing forthe appellants that since the respondents 2 and 3 were violated thestatutory duty cast upon them, the writ petition is maintainable andtherefore, prayed for the setting aside of the impugned order passedin the writ petition. 36. We have carefully considered the submissions made by thelearned counsel appearing for the appellants and learned counselappearing for the respondents 2 and 3 and also perused the materialsavailable on record in the form of typed set of documents. 37. The second respondent was appointed on 8.11.1965 as Clerk-cum-Typist in the pay scale of Rs.85-265 in the services of Indian https://hcservices.ecourts.gov.in/hcservices/ Oxygen Limited. As per the appointment order, the second appellantswas liable to be transferred to any of the company branches withinIndia and that the other conditions of service under which thesecond appellants was appointed are laid down in the Standing Orderhave also been explained to him as well as the future amendmentsthereon. The second appellants had subscribed his signature to thestaff form. 38. The second appellants joined the Tiruchirappalli branch ofIndian Oxygen Limited and thereafter he was confirmed on 1.5.1996.In the year 1995, Indian Oxygen Limited became BOC India Limited –second respondent and the second appellants worked in various officesof the second respondent. On 07.01.1988 the second appellants waspromoted as Stenographer Grade I and posted to Health Care Productsand he worked in that division and in the year 1995, Health Caredivision was renamed as Ohmeda Division and the second appellantsdesignation came to be classified as Assistant. On 24.9.1998, thethird respondent had purchased the Ohmeda Division from the secondrespondent and on 30.9.1998, the services of the second appellantshad been transferred to the third respondent. 39. The second respondent vide notice dated 30.9.1998 hadinformed the employees including the second appellants whose serviceswere transferred to the third respondent and the third respondent hadagreed to take into its services, the employees without any break orinterruption in their services and on the same terms and conditions,including retirement benefits, not in any way less favourable thanthose applicable to all of them immediately before the transfer date.The concerned employees were advised to continue to report for dutyas usual on and with effect from 1.10.1998 as there is nointerruption of their services as their services are transferred tothe third respondent. The second appellants in his letter dated7.10.1998 addressed to the second respondent, had drawn the attentionof the earlier letters dated 14.3.1998, 6.7.1998 and 20.7.1998 andreiterated that he want to continue his services with the secondrespondent only for the rest of his services and he do not want tohave change over in his employment. It is further stated by him thathe has put in more than 30 years of service in the second respondentand therefore, requested them to retain him there. 40. IOL Employees’ Union in their letter dated 9.10.1998addressed to the second respondent has cited the order passed by thisCourt in O.A.No.483 of 1991 in C.S.No.741 of 1991 dated 25.10.1991and stated that the management had taken unilateral decision totransfer the second appellants without consulting the Union and thesecond appellants was not permitted to sign in the attendanceregister from 8.10.1998 and he was informed that his name has beenstruck off in the attendance register which is patently illegal.Therefore, the Union requested the second respondent to reconsider https://hcservices.ecourts.gov.in/hcservices/ their decision. The second appellants submitted one morerepresentation dated 16.10.1998 to the second respondent submittingamong other things that there was a vacancy for cashier in cashsection and he opted to work in that section, but his request was notconsidered. The second appellants further submitted in that letterthat the medical equipment division manufacturing medical productswas long back transferred to ESAB India Limited and to the best ofhis knowledge, no such undertaking by name Ohmeda was established bythe second respondent for manufacturing various kinds of medicalequipments accessories etc., after second respondent’s medicalequipments division was sold to ESAB India Limited. Hence, thesecond appellants prayed to the second respondent for reconsiderationof the said decision. 41. The second respondent in its reply dated 26.10.1998 addressedto the General Secretary of IOL Employees' Union stated that there isno unilateral decision of transfer of services of the secondappellants but on the contrary, by virtue of transfer of undertaking,the second appellants had automatically became employee of the thirdrespondent and hence the order dated 25.10.1991 passed by this Courtin O.A.No.483 of 1991 in C.S.No.1991 has been made out of contest andnot relevant. Since the second appellants had ceased to be theemployee of the second respondent, the question of permitting him tosign the attendance register from 8.10.1998 does not arise. Thesecond respondent citing the said reasons, has objected the requestmade by the IOL Employees' Union. 42. The second appellants after filing the writ petition inW.P.No.17633 of 1998, has submitted a representation dated 29.4.1999to the third respondent stating among other things that from1.10.1998, i.e. the date of transfer, he is without any salary due tothe said illegal transfer and he has no means to live due to thecompulsion of economic necessity, he was forced to join the servicesof the third respondent and reporting for duty and the same iswithout prejudice to his rights in the above said writ petition. Thesaid representation was followed by a lawyer's notice dated 19.5.1999sent on behalf of the second appellants. The second respondent inresponse to the representation dated 29.4.1999 submitted by thesecond appellants and the lawyer's notice sent on his behalf, hasstated that since the second appellants did not convey hisacceptance, all the posts have been filled up and therefore he hasforfeited the right of employment with them. It is further stated inthe said letter that the representation of the second appellants cameafter more than six months and it make it evident that he want topursue the litigation against the second respondent and also keep hisoptions open for employment with them which is certainly notpermissible in law and that the second appellants have to stand orfall by the stand taken by him in the writ petition against the https://hcservices.ecourts.gov.in/hcservices/ second respondent. Hence, the second respondent. Hence the thirdrespondent has rejected the request of the second appellants. 43. It is to be pointed out at this juncture, the term"Undertaking" is not defined in the Industrial Disputes Act, 1947.The relevant provisions used the term "Industry". "Undertaking" is aconcept narrower than Industry. An "Undertaking" may be a part ofthe whole, that is , the "Industry" and it carries restrictedmeaning. The activity systematically or habitually undertaken forthe production or distribution of goods or for rendering materialservice to the community at large or a part of such community withthe help of employees, is an "Undertaking". In this way, theconnection between trade and business on the one hand and the"Undertaking" on the other, is established. 44. The word "Undertaking" as used in Section 25FFF of theIndustrial Disputes Act, 1947 seems to have been used its ordinarysense connoting thereby any work, enterprise, project or business"undertaking". It is not intended to cover the entire industry orbusiness of the employer. Even closure or stoppage of a part of thebusiness or activities of the employer would seem in law to becovered by this sub-section. The question has to be decided on thefacts of each case. In Associated Cement Companies case reported in[AIR 1960 SC 56] : [1960 - I L.L.J page 703] (cited supra) , ithas been held that to find whether the establishment is anundertaking, it was not possible to lay down any one test as anabsolute and invariable test for all cases. A decision was placed inproper ground that functions regarding of financial integrity,general unity and geographical proximity are to be taken intoconsideration in determining the ultimate question as to whether thefactory, plant or unit or their industry is a separate unit withinthe meaning of employment no trade test can be adopted as an absolutetest in all cases of this type and the word 'establishment' is not tobe given the sweeping definition of one organisation of which it iscapable, but rather is to be construed in the ordinary business orcommercial sense. 45. In Spencer Group Aerated Water Factory Employees' Union andothers v. Industrial Tribunal and others reported in [1996(89)Factories Journal Reports 728], it has been held that no consent ofworkers is necessary for validating the transfer of ownership ormanagement of an undertaking within the meaning of Section 25FF ofthe Industrial Disputes Act and in the said case, the company as wellas the purchaser given notice to the workmen individually making itclear that all the three conditions of the proviso to Section 25FF ofthe Industrial Disputes Act were being complied with and the workmenwere assured that the same conditions of service would prevail andthat even the settlement dated 18.9.1989 would be adhered to. https://hcservices.ecourts.gov.in/hcservices/

46. The Hon'ble Supreme Court of India, in Mettur Beardsell Ltd.,vs. Workmen and another reported in 2006(9) SCC 488 (cited supra),held that letter of consent of the individual employee cannot be aground to invalidate the action of transfer of industrial"Undertaking" and the employees who have been transferred were giventhe benefit in altered terms and conditions of work covering salary,wages retrenchment etc. At this juncture, it is useful to considerClause 10(1) of the agreement of transfer dated 24.9.1998 which is asfollows:-"The purchaser shall take into service on and from the dayimmediately following the completion Date, all the employeeswho have accepted employment with the Purchaser as listed inSch. 2. Such employees shall be transferred to the purchaserwithout any break or interruption in service and upon termsand conditions of employment (including retirement benefits)not in any way less favourable than the terms and conditionsof employment applicable to them immediately prior to thecompletion date. The Seller confirms and the Purchaseracknowledges that the Seller has provided the Purchaser witha complete list of employee benefit plans that areapplicable to the Employees and which include benefitsrelating to pension, provident fund and gratuity".47. A careful reading of the said clause would reveal that thepurchaser shall taken into services of the employees WHO HAVEACCEPTED EMPLOYMENT that the purchaser as listed in Schedule 2 andsuch employer shall be transferred to the purchaser without any breakor interruption in service and upon terms and conditions ofemployment including the retirement benefits not in any way lessfavourable than the terms and conditions of employment applicable tothem immediately prior to the completion date. 48. In the counter affidavit filed by the second respondent inthe writ petition, it has been stated that by virtue of transfer ofundertaking, the second respondent issued a notice dated 30.9.1999informing the employees about the transfer of entire undertaking ofOhmeda Health Care division to the third respondent with effect from1.10.1998 and the third respondent has agreed to take into theirservices, the employees whose names are mentioned in the list withoutany break or interruption in their service on the same terms andconditions which are less favourable all of them immediately beforesuch transfer. 49. The counter affidavit filed by the third respondent inW.M.P.No.16863 of 1999 in W.P.No.17633 of 1999 states that inpursuant to the agreement dated 24.9.1998, the second respondentagreed to sell the business of Health Care Division as a going https://hcservices.ecourts.gov.in/hcservices/ concern in favour of the third respondent with effect from 1.10.1998and the third respondent, took into its service, the employees whoaccepts the employment in the second respondent as listed in ScheduleII of the agreement. A plain reading of Clause No.10(1) of theagreement dated 24.9.1998 and the averments made in the counteraffidavit filed by the second and third respondents would show thatthe second appellants has not accepted the employment that thepurchaser viz., the third respondent and at the later point of time,submitted a representation dated 29.4.1999 and lawyer's notice dated19.5.1999 expressing his willingness to join the services of thethird respondent without prejudice to his right in W.P.No.17633 of1998. However, the third respondent has rejected the said requestvide its letter dated 8.6.1999 on the ground of failure to accept hisacceptance of employment with them. 50. This Court vide order dated 1.10.1999, in W.M.P.No.26694 of1998 in W.M.P.No.1683 of 1998 and W.P.No.17633 of 1998 had directedthe second respondent to pay a sum of Rs.6400/- every month ascompensation from 1.10.1999 till the disposal of the writ petitionand such payment could be set off or for justified in the event ofthe petitioner failing in the writ petition and as against thecompensation or other terminal benefits that may be payable to thesecond appellants ultimately. It was also represented before thisCourt that the said order was challenged by way of appeal inW.A.No.2314 of 1999 by the second respondent, but it was dismissed on21.1.2000 and the interim order has been complied with afteradmission of this writ appeal, by way of interim measure, this Courtdirected the second respondent to pay a sum of Rs.50,000/- vide orderdated 23.3.2003 and it has also been complied with. 51. The second respondent in his counter affidavit filed in thewrit petition, has specifically averred that the Health Care Divisionis an independent division and there is no functional integrityinvolved. The primary function of the second respondent is tomanufacture medical and industrial gas and whereas the function ofthe Health Care Division was purchase and sale of medical equipmentsand employees like the second appellants have been workingexclusively for the said division. 52. However, till the formation of Health Care Division by thesecond respondent, in the year 1995, the second appellants continuedto work with the second respondent and on 19.12.1996 he has beenposted as Assistant in Health Care Division. On 24.9.1998, the thirdrespondent purchased Health Care Division from the second respondentsubject to the terms of the agreement dated 24.9.1998 and Clause 10(1) of the said agreement has already been referred to above. Thesecond respondent has not taken a clear stand whether the services ofthe second appellants with the Health Care Division was https://hcservices.ecourts.gov.in/hcservices/ interchangeable and whether a common seniority was maintained etc.Though there cannot be any functional integrity between the HealthCare Division and the functions of the second respondent, the factremains the second appellants was originally in the services of thesecond respondent and in the year 1995, he was transferred to HealthCare Division as an Assistant. 53. The Hon'ble Supreme Court of India in the judgment reportedin 2008(1)- L.L.N. - BCPP Mazdoor Sangh and another v. N.T.P.C. andothers, held that the employees recruited by NTPC whose services weretransferred are neither party to tripartite agreement nor they havebeen heard before they have been changed condition and hence theaction of the management in violation of Article 14 of Constitutionof India. In the case on hand, Clause 10(1) of the agreement dated24.9.1998 entered into between the second and third respondentspecifically stipulates that the employees whose services are soughtto be transferred to the third respondent are accepted theemployment. As already stated above, the counter affidavits ofsecond and third respondents have not revealed anything about theacceptance of such employment by the second appellants. Moreover,there is no tripartite agreement entered into between the transferredemployees or their union with the second and third respondent so asto bind them. It is a specific case of the second appellants that inparagraph No.18, of his affidavit filed in support of his writpetition that the management of the second respondent provides forpension, higher rates of bonus and also payment of Rs.160/- per monthtowards health and hygiene and prosperity share amount and also thecanteen facility. The second respondent in paragraph No.21 of thecounter affidavit, has generally denied the said statement. Thethird respondent in its counter affidavit in W.M.P.No.1683 of 1998 inW.P.No.17633 of 1998 has stated that when transfer of undertakingtakes place, such transfer provides for continued employment of theworkmen of the transferor in the services of the transferee on thesame terms and conditions and without disruption. 54. Even though the above said facts are loaded in favour of thesecond appellants, we are not in a position to grant the relief inhis favour, in view of the judgment reported in (2006)9 SCC page 488- Mettur Beardsell Ltd. vs. Workmen and another, wherein it has beenheld that in case of transfer of industrial undertaking, consent ofindividual employee is not a pre-requisite and non-obtaining ofconsent cannot be a ground to invalidate the action. The Hon'bleSupreme Court while deciding the said case has approved the decisionreported in R.S.Madho Ram & Sons (Agencies) v. ITS Workmen - AIR1964 SC page 645 - R.S.Madho Ram = (1964)5 SCR 379 (cited supra).The issue regarding one undertaking running several industries orbusinesses which are distinct and separate also considered and heldthat one undertaking runs these businesses would not necessarily https://hcservices.ecourts.gov.in/hcservices/ exclude the application of Section 25-FF solely on the ground thatall the businesses or industries run by the said undertaking have notbeen transferred. 55. In the case on hand, that one of the businesses run by thesecond respondent has been transferred in favour of the thirdrespondent subject to the fulfilment of clause 10.1 of the agreementdated 24.9.1998. Even though it has not been clearly established bythe second respondent that the consent of the second appellants hasbeen obtained before transferring his services to the thirdrespondent, the fact remains, the non compliance of the said clausewould not enable him to invoke the jurisdiction of this Court underArticle 226 of the Constitution of India. The plea raised by thesecond appellants that he will lose certain benefits enjoyed by himwhile he was in the service of the second respondent requiresadjudication since it is a disputed fact, which cannot be adjudicatedin this proceeding. 56. The judgment reported in 2008(1) L.L.N. page 1 - BCPPMazdoor Sangh and another v. N.T.P.C. and others, in our consideredopinion is not applicable to the facts of the present case as theemployees of the public sector undertaking viz., NTPC have beentransferred to a private company by virtue of disinvestment policy ofthe Central Government and it was challenged by filing a writpetition. The Hon'ble Supreme Court of India, in the said decisionheld that no employee could be transferred without his consent fromone employer to another and the appellants having been selected andappointed by NTPC, their services could be continued with thatcorporation only and their transfer to a private company withouttheir consent is bad in law and it also violates Section 23 of theIndian Contract Act and Article 14 of the Indian Contract Act. Inthe case on hand, it is a transfer of service of an employee fromone private organisation to another private organisation. Eventhough the consent of the second appellants has not been obtainedunder clause 10.1 of the agreement dated 24.9.1998 entered intobetween the second and third respondents, and that it is in violationof Section 23 of the Indian Contract Act, to challenge the vires ofthe said action, writ petition cannot be maintained. It is tritelaw that that a writ is maintainable against a private body, only itperforms a public function or discharging public duty. However, thefacts of the present case would lead to an inevitable conclusion thatneither the second respondent nor the third respondent is performingany public duty and they are doing only commercial activity. Hence,the writ petition against the second respondent herein to continuethe second appellants in its service in the same manner as before1.10.1998 is not maintainable. 57. Section 25FF of the Industrial Disputes Act and proviso tosaid section cannot be held to be unconstitutional as it sufficiently https://hcservices.ecourts.gov.in/hcservices/ protects the interest of the workmen. As per Section 25FF, in theevent of retrenchment of workman who has been in continuous servicefor not less than one year in the undertaking immediately before suchtransfer, shall be entitled to notice and compensation. 58. The proviso would come into operation if the terms andconditions of workman after such transfer are not in any way lessfavourable to workman than those applicable to him immediately beforethe transfer. A reading of clause 10.1 of the agreement dated24.9.1998 would reveal that the third respondent has agreed toprovide the same benefits as provided by the second respondent andthe second appellants has not chosen to exercise his option at theearliest point of time. The option exercised by him at the laterpoint of time was rejected by the third respondent on the ground ofdelay and the pendency of W.P.No.17633 of 1998. 59. We have also considered the decision of a Division Bench ofthis Court reported in Spencer Group Aerated Water Factory Employees'Union and others v. Industrial Tribunal and others reported in [1996(vol.89) Factories Journal Reports page 728] (cited supra), and weare in full agreement with the ratio laid down in the said decision. 60. In view of the above said reasons, we find no infirmity orerror apparent on the face of the record in the impugned orderdismissing the writ petition. 61. In the result, the writ appeal is dismissed, confirming theorders passed in the writ petition. But in the circumstances, therewill be no order as to costs. 62. However, this Court is alive to the fact that the secondappellants is now aged about 65 years old and though he belatedlyexercised his option to join the services of the third respondent, itwas rejected. The second respondent may sympathetically considerthe same and arrive at a reasonable settlement with the secondappellants and grant him some monetary relief.Sd/-Asst. Registrar./true copy/Sub Asst. Registrar. gr. https://hcservices.ecourts.gov.in/hcservices/ To1. The Secretary, Union of India, Ministry of Labour, Shram Shakti Bhavan, New Delhi. 2. The Operations Manager, B.O.C. India Ltd., 75, Vaidyanathan Street, Tondiarpet, Chennai - 600 001.3. The Zonal Manager, Datex Ohmeda India (P) Ltd., 75, Vaidyanathan Street, Tondiarpet, Chennai - 600 001.+ 2 CC To M/s.Row & Reddy, Advocate SR NO.1211 & 2163+ 2 CC To M/s.T.S.Gopalan & Co, Advocate SR NO.1195 &1438+ 1 CC To M/s.Gupta & Ravi, Advocate SR NO.1879 W.A.No.286 OF 2003CK {CO}TP/23.1.2009