Misc. Case No. 174 of 2004 · The High Court
Case Details
IN THE HIGH COURT OF ORISSA AT CUTTACK W.P.(C) No.11103 of 2017 Director, M/s. Nilachala Refractories Ltd., IPITATA Nagar, Gundichapada, Dhenkanal, Dist.Dhenkanal Petitioner M/s. B.P. Tripathy, Advocate & Associates …. -Versus- The Certificate Officer, Dhenkanal, At/PO/Dist: Dhenkanal & Others …. Opposite Parties Mr. Sasanka Sekhar Sahoo, Advocate, M/s. Satyabrata Mohanty, Advocate & Associates (for Opposite Party Nos.4 and 5); Mr. H.K. Panigrahi, ASC And W.P.(C) No.11104 of 2017 Director, M/s. Nilachala Refractories Ltd., IPITATA Nagar, Gundichapada, Dhenkanal, Dist.Dhenkanal Petitioner M/s. B.P. Tripathy, Advocate & Associates …. -Versus- The Certificate Officer, Dhenkanal, At/PO/Dist: Dhenkanal & Others …. Opposite Parties Mr. Sasanka Sekhar Sahoo, Advocate, M/s. Satyabrata Mohanty. Advocate & Associates (for the Interveners); Mr. H.K. Panigrahi, ASC CORAM: JUSTICE R.K. PATTANAIK DATE OF JUDGMENT:02.09.2024 1. In the case has hand, the dispute happens to be nearly two decades old and is between the petitioner, hence called as the Management and opposite party Nos.4 and 5 being the workmen Page 1 of 16 and presently, it is confined to a proceeding commenced in terms of Section 33C(2) of the Industrial Disputes Act, 1947 (hereinafter referred to as ‘the ID Act’) and culminated followed by an action under the Orissa Public Demands Recovery Act, 1962 (shortly as, ‘the OPDR Act’) initiated vide Certificate Case Nos.345 and 346 of 2014-15 by opposite party No.1 on the requisitions received from the State Labour Commissioner, Odisha, namely, opposite party No.2 towards realization and recovery of the amounts from the former as the Certificate Debtor and payable to the latter challenged with an objection and on the premise that the proceedings are without jurisdiction denying the liability in absence of any employer and employee relationship between them. 2. The impugned orders as at Annexure-1 are at the behest of opposite party No.1 and towards realization of the sum payable to the workmen rejecting the objection received from the Management, according to which, such liability is not to be borne by it in view of the order of the Board for Industrial and Financial Reconstruction (BIFR) and the Sanctioned Scheme (SS) formulated in connection with Case No.8 of 2002 with a plea that the work force of the earlier establishment of M/s. Nilachala Refractories Limited (NRL) was reduced to three employees only, after introduction of the Voluntary Retirement Scheme (VRS) except the workmen, who were terminated along with three others and in so far as, the cash and Bank balance as on 31st March, 2005 is concerned, it was to be utilized to clear the dues of earlier employees, who opted for the VRS and have not claimed their dues till such date. As per the Management, after an auction sale was held later to the earlier NRL declared to be a sick industrial company as defined under Section 3(1)(o) of the Sick Industrial Page 2 of 16 Companies (Special Provisions) Act, 1985 (SICA), hence, was to utilize the cash and Bank balance available only to pay back the dues of such employees of erstwhile company, who had not claimed it till 31st March, 2005 after having opted for the VRS. Hence, the Management contends that it is not required to discharge any such liability vis-(cid:224)-vis the workmen and the same shall have to be limited to the BIFR order and not beyond. 3. The record reveals that earlier NRL after being declared a sick unit as per the SICA, a proceeding was initiated vide Case No.8 of 2002 and with the participation of all the stakeholders and after inviting suggestions and/or objections to the Draft Rehabilitation Scheme (DRS), the SS was prepared with the result that the Management was taken over laying down the terms and conditions in respect thereof, referring to which, it is claimed that the Management is not liable to pay and disburse the dues determined by the learned Labour Court, Bhubaneswar in Misc. Case No.174 of 2004 in absence of any such understanding and agreement excepting the SS and disbursement of the dues payable to only such employees having opted for the VRS and had not been paid with such dues as on 31st March, 2005. On the contrary, the workmen demand such payments from the Management on the ground that the latter is not absolved from any such liability after having stepped into the shoes of the erstwhile NRL and in view of Section 18(3)(c) of the ID Act being the successor or the assignee. Furthermore, the claim of the workmen is that due to the demand for such entitlements and the proceedings under Section 33(C)(2) of the ID Act, the earlier establishment of NRL terminated their services with three others, with whom, the Management had a settlement later taking a plea that one cannot escape from such liability and in view of the Page 3 of 16 orders of the learned Labour Court, Bhubaneswar, opposite party No.1 was duty bound to ensure its realization and recovery from the Management as per the provisions of the OPDR Act.
Legal Reasoning
4. Heard Mr. Tripathy, learned counsel for the Management and Mr. Mohanty, learned counsel for the workmen besides Mr. Panigrahi, learned ASC for the State. 5. Mr. Tripathy, learned counsel for the Management, in course of hearing, reiterated the facts described hereinbefore and contends that the alleged demand by the workmen cannot be enforced against the Management which has no any responsibility to discharge the liability save and except to utilize the cash and Bank balance available for clearing the dues of earlier employees, who had availed the VRS. The contention of Mr. Tripathy, learned counsel is that opposite party No.1 lost sight of the BIFR order and the SS and rejecting such a plea denying the liability by the Management and proceeded to pass the impugned orders under Annexure-1. While claiming so, Mr. Tripathy, learned counsel refers to a copy of the BIFR order vis-(cid:224)-vis a proceeding in Case No.8 of 2002 and the terms and conditions arrived at when the earlier NRL was taken over by a transfer as per the provisions of the SICA. The further contention is that the workmen do not have any entitlements to claim in view of the award of the learned Industrial Tribunal, Bhubaneswar in I.D. Case No.4 of 2010 while dealing with a reference under Section 10 of the ID Act received for a decision, whether, the termination of their services and others with effect from 31st March, 2005 by the Management to be legal and/or justified with a definite finding that the workmen are not entitled to any relief in absence of clear indication in the SS regarding such liability to be borne by the Management. It is further stated that the reference was Page 4 of 16 disposed of on 6th January, 2012 with the above conclusion and observation that in absence of the erstwhile Management, it is not desirable to thrash out, whether, the termination of services of all such workmen is otherwise lawful. Mr. Tripathy, learned counsel further submits that the decision in I.D. Misc. Case No.174 of 2004 under Section 33C(2) of the ID Act as at Annexure-B/4 to the counter affidavit is under challenge at the instance of the Management in W.P.(C) No.21179 of 2016 and unless and until, any such liability under question is finally determined and decided, the proceedings under the OPDR Act with the requisitions received from the Government by and at the behest of opposite party No.1 would not be proper and justified. 6. Mr. Panigrahi, learned ASC for the State justifies the action initiated under the OPDR Act against the Management in view of the orders in I.D. Misc. Case No. 174 of 2004 in order to ensure payment of the outstanding dues in favour of the workmen. As per Mr. Mohanty, learned counsel for the workmen, the Management took over the erstwhile establishment and currently running the unit successfully and in so far as, three other employees besides the workmen are concerned, they have been paid the entitlements, which, rather, revealed the discriminatory attitude of the Management. It is further submitted by Mr. Mohanty, learned counsel that the BIFR order clearly stipulates that all the statutory dues are to be disclosed and the new promoters need to undertake due diligence and to ensure that there are no cases pending before the taking over of the company into their fold and in so far as, the cash balance of Rs.55.79 lac available for clearing the dues of the earlier employees, who opted for the VRS, out of the same, surplus is still lying in the hands of the Management and when such dues determined vis-(cid:224)- Page 5 of 16 vis the workmen under Section 33C(2) of the ID Act having not been paid, it has conspicuously revealed the unequal treatment meted out to such employees once engaged and worked for the establishment. The contention of Mr. Mohanty, learned counsel is that with the hearing held in I.D. Misc. Case No.174 of 2004 under Section 33C(2) of the ID Act, learned Labour Court, Bhubaneswar passed the order dated 16th August, 2012 to pay the computed amount to the workmen within a period of three months, failing which, it shall carry interest at the rate of 10% per annum till actual payment and since, the Management did not take any step to pay the same, the certificate proceedings were initiated on receiving requisitions from opposite party No.2 and after hearing both the sides, opposite party No.1 directed it to deposit the certificate amount with interest, otherwise, to face action under Section 37 of the OPDR Act. It is stated that due to such non-payment, notice under Section 6 of the OPDR Act as at Annexure-2 was issued for recovery of the same with interest within a stipulated period. It is alleged that the Management did not disburse the amount or deposit it before opposite party No.1, rather, obtained a stay order in force since 2017. It is informed to the Court that one of the workmen is suffering from spinal cord injury and confined to bed being paralyzed and presently, aged about 65 years and in so far as the proceedings under the OPDR Act are concerned, as the show cause notices issued were challenged, this Court by orders in W.P.(C) Nos.3734 and 3735 of 2016 directed opposite party No.1 to dispose it of after a hearing of the parties providing the Management an opportunity to defend and thereafter, to take a decision and action according to law. It is reiterated by Mr. Mohanty, learned counsel that the orders in I.D. Misc. Case No.174 of 2004 and subsequent order later to a modified requisition received from opposite party No.2 Page 6 of 16 is enforceable against the Management in view of Section 18(3)(c) of the Act being the successor with respect to the erstwhile establishment to which the dispute relates and hence, it is bound to discharge the obligation. 7. A preliminary objection is raised with regard to maintainability
Decision
of the writ petition at the behest of the Management with a plea that the impugned orders under Annexure-1 to be appealable in nature. According to Mr. Panigrahi, learned ASC for the State, such a decision in the proceedings under the OPDR Act may be challenged in appeal by the Management, which instead approached this Court, hence, the writ petition is not to be entertained. It is submitted by Mr. Panigrahi, learned ASC that the Management should avail the statutory remedy. In reply and response to the above, Mr. Tripathy, learned counsel for the Management submits that writ jurisdiction could be exercised in spite of availability of an alternate remedy and as such, there is no bar, especially when, opposite party No.1 did not have the jurisdiction in view of the BIFR order and a restricted liability emerged therefrom. In support of such contention, Mr. Tripathy, learned counsel relies on the following decisions, such as, Harbanslal Sahnia and Another Vrs. Indian Oil Corporation Ltd. and Others (2003) 2 SCC 107 and Godrej Sara Lee Ltd. Vrs. Excise and Taxation Officer-cum-Assessing Authority and Others 2023 SCC OnLine SC 95. The contention of Mr. Tripathy, learned counsel for the Management is that any such exclusion of writ jurisdiction is a rule of discretion and may well be exercised notwithstanding existence of alternate statutory remedy. 8. Referring to an earlier decision in Whirlpool Corporation Vrs. Registrar of Trade Marks (1998) 8 SCC 1, the Apex Court in Harbanslal Sahnia (supra) reaffirmed that the writ jurisdiction may Page 7 of 16 have to be exercised in the following contingencies, such as, for enforcement of any of the fundamental rights; on failure of principles of natural justice; where the orders or proceedings are wholly without jurisdiction or the vires of an Act is challenged. In fact, the conclusion reached at in the case of Whirlpool Corporation has been restated by the Apex Court in Harbanslal Sahnia (supra), wherein, it was of the view that the termination of dealership to be illegal as it infringed upon the fundamental rights and breached the principles of natural justice for being a decision based on irrelevant and a non-existent cause. In Godrej Sara Lee Ltd. (supra), the Apex Court elaborated further and observed that the power to issue prerogative writs under Article 226 is plenary in nature; any limitation on the exercise of such power must be traceable in the Constitution itself; Article 226 does not, in terms, impose any limitation or restraint on the exercise of power to issue writs; it is axiomatic that there lies a discretion, whether, to entertain a writ petition or otherwise is to depend on the facts of each particular case; one of the self-imposed restrictions on the exercise of powers under Article 226 that has evolved through judicial precedents is to the effect that it should normally not be entertained, where an effective alternative remedy is available; at the same time, it must be remembered that mere availability of an alternative remedy of appeal or revision, which the party invoking the jurisdiction under Article 226 has not pursued, would not oust the jurisdiction and render a writ petition not maintainable; in a long line of decisions, it has been made clear that availability of an alternative remedy does not operate as an absolute bar to the maintainability of a writ petition and that, the rule, which requires a party to pursue the alternative remedy provided by a statute, is a rule of policy, convenience and discretion, rather than, a rule of law. Page 8 of 16 9. The maintainability of a matter and its entertainability, as according to the decision in Godrej Sara Lee Ltd. (supra), are distinct concepts as the former goes to the root of the jurisdiction, whereas, in the latter case, an element of discretion is involved to consider, whether, any such writ jurisdiction is to be exercised due to existence of an alternate remedy. In fact, the decision in State of Uttar Pradesh Vrs. Mohd. Nooh 1958 SCR 595 referred to in the case of Godrej Sara Lee Ltd. outlined the considerations while dealing with the writ jurisdiction. 10. In view of the above decisions and ratio laid down by the Apex Court discussed herein above, law is well settled that exclusion of writ jurisdiction due to existence of alternate remedy is not readily to be inferred. Such exercise of jurisdiction is extraordinary in nature and whether to invoke powers under Article 226 of the Constitution of India or otherwise is to be left to the discretion of the Court. In Harbanslal Sahnia and Whirlpool Corporation (supra), at least four of the contingencies have been highlighted upon to be taken judicial notice of at the time of exercising writ jurisdiction. It depends on the facts and circumstances of a particular case to determine, whether, the jurisdiction is to be invoked even when alternate statutory remedy is in place. As pointed out by the Apex Court, in the aforementioned decisions, there is no bar or restriction in exercise of writ jurisdiction. The writ powers may not be exercised in a given set of facts but shall have to consider an objection as to maintainability of an action, which hits to the root of the matter as lucidly stated by the Apex Court in Godrej Sara Lee Ltd. (supra). An objection to the exercise of jurisdiction on maintainability excludes the authority, it shall be a reason to intervene and interfere, notwithstanding, a statutory remedy Page 9 of 16 available challenging the same. If a matter, which is decided and can very well be taken cognizance of by the statutory authority being an alternate remedy, under such circumstances, the writ jurisdiction is not to be exercised. However, in case, where there is no other equally efficacious remedy and it relates to one of the contingencies (understood to be not exhaustive) enumerated in Harbanslal Sahnia and earlier discussed in Whirlpool Corporation (supra) by the Apex Court and having due regard to the Constitution Bench decision in Mohd. Nooh, wherein, it reminded that there is no rule with regard to certiorari, as is with mandamus that it would lie when there is no other effective remedy, the writ powers shall have to be invoked in order to do ex debito justitiae. In other words, to ensure complete justice, even where alternate statutory remedy is available, unless it hits to the authority or jurisdiction, writ powers shall have to be exercised instead of driving the parties to such remedy, which in most cases found to be a futile exercise. 11. Turning to the arguments advanced by both the sides, the Court is required to take a call as to if alternate remedy under the OPDR Act could well be a reason not to exercise the writ jurisdiction vis-(cid:224)-vis the action initiated by opposite party No.1 upon receiving the requisitions from the Government. Referring to the plea that the Management is not liable to discharge the obligation in view of BIFR order, Mr. Tripathy, learned counsel submits that the proceedings initiated under the OPDR Act and action by opposite party No.1 to realize the outstanding dues payable to the workmen is without authority and jurisdiction and hence, in view of the decision in Harbanslal Sahnia and Whirlpool Corporation (supra), as one of the contingencies has been fulfilled, with regard to absence of jurisdiction, the impugned Page 10 of 16 orders under Annexure-1 and legality thereof shall have to be examined exercising the writ jurisdiction even though the same are held to be appealable in nature. The Court is not in agreement with the contention of Mr. Tripathy, learned counsel for the Management, since due process has been followed all along to ensure realization of the outstanding dues of the workmen and the certificate proceedings and initiation of it are the means to achieve and ensure the recovery. It is not a case where infringement of fundamental right is alleged or for that matter, there is failure of principles of natural justice. It is not that the Management did not have opportunity to defend and that opposite party No.1 failed to observe fairness before passing the impugned orders under Annexure-1. The Management has had opportunity to participate. So therefore, it cannot be said that the principles of audi alteram partem have not been observed and hence, the Management is in a way prejudiced. As regards, the absence of jurisdiction, according to Mr. Tripathy, learned counsel for the Management, opposite party No.1 lacked any such authority and hence, without powers for the BIFR order and the SS. The Court is of the considered view that such a plea must have to fail. It cannot be assumed or held that opposite party No.1 did not possess the jurisdiction to deal with the certificate proceedings with such a plea. In fact, the earlier requisition and a modified one received later from opposite party No.2 is the foundation to realize and recover the outstanding dues with interest payable to the workmen. The learned Labour Court while entertaining request and an application under Section 33C(2) of the ID Act held the Management to pay back the entitlements to the workmen, subsequent to which, the requisitions were received by opposite party No.1. It can, therefore, be said that with the order of the learned Labour Court in place, for having received the Page 11 of 16 requisitions and thereafter, all such defences since available to be raised by the Management as per Section 8 of the OPDR Act, it is to be held that due process has been followed. To claim that opposite party No.1 did not have any jurisdiction for the certificate proceedings with a contention that there is no liability against the Management in view of the order of the BIFR does not make it a case to fall in one of the contingencies as endorsed in the decision of Harbanslal Sahnia (supra). To elaborate further, the Court is to hold that it is not a case to claim the proceedings before opposite party No.1 as ‘wholly without jurisdiction’. If an authority has no powers or a statute does not allow it to exercise any such jurisdiction or a law forbids it to do so or where the vires of any such law is a subject matter of challenge, under such circumstances, writ jurisdiction shall have to be invoked despite an alternate remedy. In the instant case, considering the plea denying the liability by the Management with reference to the BIFR order cannot be the basis to claim that opposite party No.1 did not have any jurisdiction at all. Such authority has been exercised by and in course of the certificate proceedings by opposite party No.1 upon receiving the requisitions from the Government and hence, is not a case of absence of jurisdiction. With regard to the liability, whether the same is to be discharged by the Management, it shall have to be challenged independently and now stated to be pending decision in W.P.(C) No.21179 of 2016 and hence, to allege that opposite party No.1 is, therefore, having no powers cannot be a ground and a reason to reach at a conclusion as to lack of jurisdiction under law. It is to be held that any such plea with denial of liability by the Management is beyond the domain and purview of opposite party No.1, who has no other option, as he cannot go behind the orders of the learned Labour Court except to honour the requisitions received Page 12 of 16 from the Government and enforce it ensuring recovery of the outstanding dues payable to the workmen. 12. Mr. Mohanty, learned counsel for the workmen has referred to the following decisions, such as, A.M. Sainalabdeen Musaliar Vrs. The District Collector, Kollam and Others 1994 LAB. I.C. 57; Karnataka Power Transmission Corporation Ltd. and Another Vrs. Amalgamated Electricity Co. Ltd. and Others AIR 2001 SC 291; State of Orissa and Another Vrs. N.N. Swamy & Others 1977 SCC (2) 508 and finally, Shri Dillip Kumar Samal Vrs. State of Orissa and Another 2007 (II) OLR 788 to contend that the Management as a successor or assignee shall have to bear the burden and discharge the liability of the erstwhile establishment. As earlier discussed, a reference has been made to Section 18(3)(c) of the ID Act by Mr. Mohanty, learned counsel for the workmen to claim that the Management cannot shirk its responsibility hiding itself behind the veil of BIFR order but according to the Court, all such aspects and legality of the decision of the learned Labour Court are needed to be examined in W.P.(C) No.21179 of 2016. It is further to be observed that the decision with respect to the reference under Section 10 of the ID Act by the learned Industrial Tribunal, Bhubaneswar is a matter to be gone into for a decision by this Court in W.P.(C) No.12381 of 2012 stated to be pending disposal. Whether the workmen is entitled for the dues in juxtaposition to the reference under Section 10 of the Act with the decision of the learned Industrial Tribunal and whether it was legally justified for the learned Labour Court to compute the dues receivable by the workmen against the background facts, such as, declaration of the unit as sick company and its auction sale with the BIFR order and the SS in place is to be dealt with and adjudicated upon in W.P.(C) No.12381 of 2012 and W.P.(C) Page 13 of 16 No.21179 of 2016. Though, it is contended by Mr. Mohanty, learned counsel for the workmen that the Management as the successor employer shall have to discharge the liability relying on the case laws cited, at this juncture, this Court while dealing with a matter in relation to the certificate proceedings cannot consider the same in view of a decisions awaited vis-(cid:224)-vis the orders in I.D. Misc. Case No.174 of 2004 and decision on the reference under Section 10 of the ID Act with an award dated 6th January, 2012 having been challenged by the workmen in the meantime. In view of the above, the Court refrains itself from expressing any opinion or view either way on the plea of the respective parties due to pendency of W.P.(C) No.12381 of 2012 and W.P.(C) No.21179 of 2016 as it is concerned with legality of the orders under Annexure-1 and exercise of jurisdiction by opposite party No.1 under the OPDR Act simpliciter. It is also to be held that the Management cannot deny any such realization and recovery though it depends on the decision with respect to orders in I.D. Misc. Case No.174 of 2004 in W.P.(C) No.21179 of 2016 besides W.P.(C) No.12381 of 2012 filed against the award dated 6th January, 2012. Unless, there is any restriction against recovery through the certificate proceedings against the orders in I.D. Misc. Case No.174 of 2004, realization and recovery under the OPDR Act cannot be withheld. 13. One more contention is advanced by Mr. Tripathy, learned counsel for the Management that order dated 16th August, 2012 stands superseded by a fresh order of the learned Labour Court dated 18th April, 2015, hence, the action with notice in the certificate proceedings is without jurisdiction. In fact, it is made to understand that initially a requisition was received and thereafter, a modified one, so revealed from the impugned order under Page 14 of 16 Annexure-1 in Certificate Case No.346 of 2014-15, as it has been claimed that upon disposal of W.P.(C) No.29005 of 2013 challenging the order dated 16th August, 2012 of the learned Labour Court, this Court remitted the matter back by order dated 12th March, 2015 directing a fresh disposal of the proceeding in I.D. Misc. Case No.174 of 2004, which led to the passing of a final order dated 18th April, 2015. Though, the order of the learned Labour Court dated 16th August, 2012 appears to have merged with the final order dated 18th April, 2015 passed in I.D. Misc. Case No.174 of 2004, consequent upon receipt of a modified requisition, the certificate proceeding was initiated with an order dated 17th May, 2017 passed in Certificate Case No.346 of 2014-15 and against such a backdrop, any such objection from the Management with a plea that the order dated 16th August, 2012 no more existed having been superseded cannot be entertained as upholding such objection would lead to a miscarriage of justice. If it is alleged by the Management that after the matter was remitted back with the disposal of W.P.(C) No.29005 of 2013 and followed by an order dated 18th April 2015 without hearing, the Court is not inclined to entertain any such plea at present, in absence of any material revealed and discernable from the record. In any case, the defence of the Management relying on BIFR order is a matter alien to the issue at hand concerning the certificate proceedings. So therefore, the impugned orders under Annexure-1 as opposed by the Management with the above plea on record cannot be sustained as it is not an exercise wholly without jurisdiction. Thus, the final conclusion of the Court is that the plea of the Management vis-(cid:224)- vis exercise of jurisdiction by opposite party No.1 referring to the BIFR order on any such grounds is liable to be rejected leaving it the option to avail such other remedy as permissible under law. Page 15 of 16 14. Hence, it is ordered. 15. In the result, for the reasons stated and observations made herein above, the writ petitions stand dismissed. 16. In the circumstances, however, there is no order as to costs. Balaram (R.K. Pattanaik) Judge Signature Not Verified Digitally Signed Signed by: BALARAM BEHERA Designation: Personal Assistant Reason: Authentication Location: HIGH COURT OF ORISSA, CUTTACK Date: 03-Sep-2024 11:18:01 Page 16 of 16