ENDEAVOUR ESTATES P LTD Vs. ASST LABOUR COMMR

JUDGEMENT

(1.) THE petitioner seeks to quash the orders passed by the Assistant Labour Commissioner and the Deputy Commissioner under the payment of Gratuity Act, 1972 dated May 29, 1994 and August 17, 1996 respectively.

(2.) IT is the case of the petitioner that it is a company incorporated under the Companies act 1956. The petitioner purchased immovable property constituted of coffee plantation, fruit trees shade trees etc. , in public auction conducted on March 27, 1991 in execution of decree passed in O. S. No. 300/87 on the file of subordinate Judge, Irinjalakuda, Kerala. The sale was confirmed on May 27, 1991, followed by a certificate of sale issued by the Court. The petitioner started with its plantation activities after purchasing the immovable property in public auction. As there were already workmen working in the plantation when the property was purchased by the petitioner, the petitioner on the request of the-workmen agreed to provide them employment in the petitioner company. On retirement of respondents 3 to 9, the petitioner paid them gratuity for the period during which these employees worked for the petitioner. Not satisfied with this, respondents 3 to 9 made an application to the first respondent, seeking payment of gratuity for the period during which they had worked for the previous owner of the estate. The first respondent without considering these facts, in particular, the fact that the petitioner had purchased the property in public auction and not purchased the estate as a going concern, passed an order dated May 28, 1994 directing the petitioner to pay gratuity to these workmen even for the period prior to the petitioner employing them. However, the respondents had been paid with the later gratuity. It is contended that the petitioner was not responsible to pay gratuity for the period prior to providing work to the respondents in the company.

(3.) MR. S. N. Murthy, appearing for the petitioner submitted that the order of the first respondent is against law and the purchase of the estate was not considered. But it was only a purchase in open Court auction and that only the property was purchased. The workmen in question cannot claim continuity of service as there was no transfer of ownership of estate and the workmen in question were appointed only after purchase of property and as such employer and employee relationship between respondents 3 to 9 came into being only after the date of purchase. In the absence employer and employee relationship the Payment of gratuity Act does not contemplate for gratuity payment to any person. It is necessary to place on record that the provident Fund Department approached the civil Court for amount payable by the previous owner whose property was auctioned and out of the sale consideration received by the Court, the Department satisfied its dues. The petitioner is in no way liable or responsible to pay the gratuity amount for the period during which these employees had not worked for the petitioner i. e. , prior to purchase of the property. The first respondent without considering the above facts has passed an order to the effect that the petitioner is responsible to pay gratuity for the entire service. The second respondent has confirmed the order of first respondent taking the view that as the workers who were working in the Belegeri Estate were not terminated from service, It should be construed that they were continued in service under the management of the petitioner which is totally opposed to facts. Merely because the petitioner agreed to provide work to the workmen who were working in the estate till then, it cannot be said, that they should be treated as employees even for the period during which they were not the owners of the estate and consequently, had no occasion to employ the workmen in question. The property was purchased in public auction which is without any liability whatsoever. There is no question of transfer of ownership or transfer of property within the meaning of transfer of Property Act so as to fasten the liability to the property in view of the transfer. It is not voluntary transfer and the transfer effected under the orders of Court by sale under the provisions of law.