PRESIDENT/SECRETARY, J.K. SYNTHETICS MAZDOOR UNION (CITU), INDIRA GANDHI NAGAR, KOTA & ORS. Vs. ARFAT PETROCHEMICALS PVT. LTD. & ORS.

JUDGEMENT

(1.) Civil Appeal Nos. 8597 and 8598 of 2010 are filed by President, J.K. Synthetics Mazdoor Union, Kota & Ors. and General Secretary, Rajasthan Trade Union Kendra & Anr. respectively against the judgment dated 28.07.2009 of the Rajasthan High Court at Jaipur in Civil Writ Petition No. 2006 of 2009. Civil Appeal No. 8599 of 2010 is filed by M/s J.K. Synthetics Ltd. against the same judgment to a limited extent that the findings in its favour given by the Appellate Authority for Industrial and Financial (AAIFR) vide order dated 11.12.2008 were reversed without any challenge to the same.

(2.) The parties will hereinafter be referred to as arrayed in Civil Appeal No. 8597 of 2010. The facts relevant for adjudication of the dispute in these Appeals are as follows: J.K. Synthetics Limited (now Jay Kay Enterprises Ltd.), who is the Second Respondent was declared a sick industrial company on 02.04.1998. The Industrial Development Board of India (IDBI), who is the Fourth Respondent was appointed as the Operating Agency. A Draft Rehabilitation Scheme was submitted on 06.06.2000. As per the said Scheme, a revival of the cement units by de-merging them into a separate unit was proposed. This was not accepted by the creditors and the Operating Agency. The Board for Industrial and Financial Reconstruction (BIFR) directed an advertisement to be issued for a change of management of the company for the purpose of rehabilitation. The Second Respondent challenged the order dated 06.06.2000 by filing an Appeal before the AAIFR. The AAIFR circulated a Draft Rehabilitation Scheme for approval on 31.01.2001. The AAIFR allowed the said Appeal by its order dated 23.01.2003 by setting aside the order of the BIFR dated 06.06.2000. By the said order, the AAIFR sanctioned the Draft Rehabilitation Scheme dated 31.01.2001 by which the proposal of the de-merger of cement units was accepted.

(3.) In the meanwhile, the Second Respondent entered into a Memorandum of Understanding (MoU) with M/s Arafat Petrochemicals Pvt. Ltd. (APPL), the First Respondent herein. According to the said MoU the assets of the Kota Units of Respondent No. 2 were to be sold to Respondent No.1 for a total consideration of Rs. 15 crores. The liability towards payment to the workmen was to be borne by APPL. It is also relevant to mention here that a Tri-Partite Labour Settlement Agreement (TLSA) was executed between the First Respondent, Second Respondent and the Labour Unions on 09.10.2002. Another TLSA on the same terms was entered into between the First Respondent, Second Respondent and Staff Association on 22.10.2002. The total liability under the TLSAs worked out to approximately Rs.43.69 crores. There is no unanimity between the parties on the scope of the above mentioned TLSAs. The First Respondent claims that there is no compulsion on its part to provide future employment to all the existing workmen whereas the workmen contend to the contrary. There is also a dispute about the obligation of First Respondent to revive the Kota units.