MARUTI UDYOG LTD Vs. RAM LAL

JUDGEMENT

(1.) WHAT is challenged in this petition under Article 226 of the Constitution is the award of the Labour Court dated July 28. 1993 holding that respondents 1 to 3 are entitled to be reemployed by M/s. Maruti Udyog Limited, the petitioner herein.

(2.) THE circumstances under which the reference was made by the State of Haryana may be stated. Ram Lal, Jhinak Prasad and Sampat Parshad (hereinafter called the workmen) were employed as Electrician. Helper and Assistant Fitter respectively by M/s. Maruti Limited (for short the company), incorporated under the provisions of the Companies Act. 1956 and which was carrying on its business activities at Gurgaon. The service of these workmen were retrenched by the company with effect from August 26, 1977 and August 25, 1977 though there is a dispute between the parties as to whether any retrenchment compensation was paid or not. However, we are not concerned with this dispute in the present case. The workmen never challenged their retrenchment and, therefore, the master servant relationship between them and the company came to an end. Due to certain unanticipated adverse factors the company could not achieve the expected level of its production and meet its financial obligations. There was a run on the company by its creditors as a result whereof liquidation proceedings were, initialed in this Court and an order for winding up the company was passed on March 6, 1978 and the Official Liquidator attached to this Court was appointed its Liquidator. While liquidation proceedings were continuing the Parliament enacted the Maruti Limited (Acquisition and Transfer of Undertakings) Act, 1980 (hereinafter called the Acquisition Act ). This Act was enacted to provide for the acquisition and transfer of the undertakings of the company in order to secure the utilisation of the available infrastructure, to modernise the automobile industry, to effect a more economical utilisation of scarce fuel and to ensure higher production of motor vehicles which were considered essential for the needs of the economy of the country. According to Section 3 of this Act, the undertakings of the company and its right, title and interest in relation to its undertakings stood transferred to and vested in the Central Government. It was further provided that all properties which vested in the Central Government shall be freed and discharged from any trust, obligation, mortgage, charge, lien and all other encumbrances affecting them, and any attachment, injunction, decree or order of any court restricting the use of such properties in any manner shall be deemed to have been withdrawn. By virtue of Section 5 of the Acquisition Act, every liability of the company in respect of any period prior to the appointed day, shall be the liability of the company and shall be enforceable against it and not against the Central Government, or where the undertakings of the company are directed under Section 6 to vest in a Government company, against the Government company. Section 6 then provides that the Central Government may. subject to such terms and conditions as it may think fit to impose direct by notification, that the undertakings of the company, and the right, title and interest of the company in relation to its undertakings which have vested in the Central Government under Section 3 shall, instead of continuing to vest in the Central Government, vest ill a Government company either on the date of the notification or on such earlier or later date, as may be specified in the notification. Sub-section (2) then provides that where the right, title and interest of the company, in relation to its undertakings, vest in a Government company under Sub-section (1 ). the Government company shall, on and from the date of such vesting, be deemed to have become the owner in relation to such undertakings and all the rights and liabilities of the Central Government in relation to such undertakings shall on and from the dale of such vesting, be deemed to have become the rights and liabilities of the Government company. Chapter IV of the Acquisition Act makes some provisions relating to the employees of the company. Sub-Section (1) of Section 13 which is relevant for our purpose is reproduced hcreunder for facility of reference

(3.) IT will be seen that by virtue of the provisions of Section 3 the undertakings of the company came to vest in the Central Government. This Government then in exercise of its powers under Section 6 of the Acquisition Act directed by a notification dated April 24, 1981 that the undertakings of the company and the right, title and interest of the company in relation to its undertakings which had vested in it shall now vest in Maruti Udyog Limited the petitioner - a Government company. It is agreed between the parlies that the petitioner company was constituted some time prior to April 24, 1981.