Case Note & Summary
The appeal was filed by workmen against the judgment of a learned Single Judge of the Bombay High Court, who had set aside the order of the Industrial Court, Aurangabad, in Complaint ULP No. 375/1999. The workmen had filed the complaint under sections 28 and 30 read with Item No. 9 of Schedule IV of the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971, against two companies: M/s. Everkeen Blade Company Limited (company No. 1) and M/s. Centron Industrial Alliance Limited (company No. 2). The workmen alleged that they were employed by company No. 1, which was a subsidiary of company No. 2, and that there was functional integrality between the two companies as they manufactured the same product (safety razor blades) and workers were transferable between them. The Industrial Court allowed the complaint and directed both companies to jointly pay compensation of Rs.1,00,000/- to each workman. The learned Single Judge set aside this order. The Division Bench, after hearing both sides, allowed the appeal and restored the Industrial Court's order, holding that the Single Judge had erred in interfering with the finding of functional integrality and the award of compensation.
Headnote
A) Industrial Law - Unfair Labour Practice - Functional Integrality - Sections 28, 30 r/w Item 9 of Schedule IV of Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 - The Industrial Court found functional integrality between two companies manufacturing same product, with transferable workers, and held them jointly liable for unfair labour practices - The Division Bench restored the compensation award of Rs.1,00,000/- each to the workmen, holding that the Single Judge erred in setting aside the order (Paras 1-3).
Issue of Consideration
Whether the learned Single Judge was justified in setting aside the Industrial Court's order directing two companies to pay compensation for unfair labour practices, and whether the companies are jointly liable due to functional integrality.
Final Decision
The appeal is allowed. The judgment and order of the learned Single Judge in Writ Petition No. 3970/2005 is set aside. The order of the Industrial Court, Aurangabad in Complaint ULP No. 375/1999 is restored.
Law Points
- Functional integrality
- Joint liability of subsidiary and holding company
- Unfair labour practice
- Compensation for unfair labour practice
Case Details
2018 LawText (BOM) (03) 24
Letters Patent Appeal No. 13 of 2007 in Writ Petition No. 3970 of 2005 with Civil Application No. 1404 of 2006
T.V. Nalawade, Sunil K. Kotwal
Mr. R.V. Gore for appellant, Mr. A.G. Godhamgaonkar for respondent No. 1
M/s. Everkeen Blade Company Limited, M/s. Centron Industrial Alliance Ltd.
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Nature of Litigation
Appeal against judgment of Single Judge setting aside Industrial Court's order awarding compensation for unfair labour practices.
Remedy Sought
Appellants sought restoration of Industrial Court's order directing respondents to pay compensation.
Filing Reason
Appellants alleged unfair labour practices by respondents, including functional integrality between two companies and transfer of workers.
Previous Decisions
Industrial Court allowed Complaint ULP No. 375/1999 and directed respondents to pay compensation of Rs.1,00,000/- to each appellant. Learned Single Judge set aside that order.
Issues
Whether the learned Single Judge was justified in setting aside the Industrial Court's order?
Whether there was functional integrality between the two companies making them jointly liable?
Submissions/Arguments
Appellants argued that there was functional integrality between the two companies as they manufactured same product and workers were transferable.
Respondents argued against the finding of functional integrality and joint liability.
Ratio Decidendi
The Division Bench held that the learned Single Judge erred in setting aside the Industrial Court's order, as there was sufficient evidence of functional integrality between the two companies, making them jointly liable for unfair labour practices. The compensation awarded by the Industrial Court was justified.
Judgment Excerpts
The appeal is filed against judgment and order of Writ Petition No. 3970/2005 decided by the learned Single Judge of this Court.
The learned Single Judge has set aside the judgment and order of Member, Industrial Court, Aurangabad delivered in Complaint ULP No. 375/1999.
Procedural History
Complaint ULP No. 375/1999 was filed before Industrial Court, Aurangabad, which allowed it and directed compensation. The respondents challenged this in Writ Petition No. 3970/2005, which was allowed by the Single Judge, setting aside the Industrial Court's order. The appellants then filed the present Letters Patent Appeal.
Acts & Sections
- Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971: 28, 30, Schedule IV Item 9
