A.V. Krishnan Moosad v. District Collector, Kollam and Archdiocese of Verapoly

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT: THE HONOURABLE MR.JUSTICE A.M.SHAFFIQUE MONDAY, THE 5TH DAY OF MARCH 2012/15TH PHALGUNA 1933 WP(C).No. 4084 of 2008 (J) -------------------------CP.21/2004 of LABOUR COURT, KOLLAM PETITIONER: ------------- A.V. KRISHNAN MOOSAD, ACHUTHATH ILLOM, S.F.305, NANDINI GARDEN WEST FORT, THIRUVANANTHAPURAM-23. BY ADVS.SRI.P.B.SAHASRANAMAN SRI.K.JAGADEESH SRI.T.S.HARIKUMAR RESPONDENTS: -------------- 1. THE DISTRICT COLLECTOR, COLLECTORATE, KAKKANAD, ERNAKULAM KOCHI-682038. 2. ARCHDIOCEASE OF VERAPOLY, LATIN ARCHBISHOP'S HOUSE, POST BOX NO.2581 KOCHI-682031. R, BY SRI.M.M.MATHEW R,R.2 BY SRI.M.D.SASIKUMARAN R1 BY GOVERNMENT PLEADER MR.JAMES MATHEW KADAVAN THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 6.1.2012, THE COURT ON 05-03-2012 DELIVERED THE FOLLOWING: ## WP(C).No. 4084 of 2008 (J) ## APPENDIX PETITIONER'S EXHIBITS: |EXT.P1|-|TRUE PHOTOSTAT COPY OOF THE AWARD PASSED BY| |---|---|---| |||THE LABOUR COURT, KOLLAM IN C.P.NO.21/2004| |||DATED 8TH JUNE, 2006.| |EXT.P2|-|TRUE PHOTOCOPY OF THE LETTER NO.E-7-4/07-08/| |||LABOUR DUES, DT. 20.8.2007 SENT BY THE| |||TAHSILDAR (RR) , KANAYANNUR TALUK TO THE| |||DISTRICT LABOUR OFFICER, ERNAKULAM.| |EXT.P3|-|TRUE PHOTOSTAT COPY OF THE LETTER SENT BY| |||FR.GEORGE VELIPARAMBIL, MANAGING EDITOR,| |||KERALA TIMES, DATED 8TH SEPTEMBER, 1979.| |EXT.P4|-|TRUE PHOTOSTAT COPY OF THE POWER OF ATTORNEY| |||ISSUED BY ARCHBISHOP DR.JOSEPH, KELLANATHARA,| |||DATED 30TH APRIL, 1986.| |EXT.P5|-|TRUE PHOTOSTAT COPY OF THE APPOINTMENT ORDER| |||ISSUED TO FR.PETER KUNNALAKAT, DT. 12.1.1987.| |EXT.P6|-|TRUE PHOTOSTAT COPY OF THE “CENSUS AND| |||STATISTICAL DATA” OF THE KERALA TIMES,| |||DATED 12.1.1998.| |EXT.P7|-|TRUE PHOTOSTAT COPY OF THE DIRECTORY OF| |||ARCHDIOCESE OF VERAPOLY - 1999 DATED 25TH| |||APRIL, 1999 PUBLISHED BY THE 2ND RESPONDENT.| |EXT.P8|-|TRUE PHOTOSTAT COPY OF THE REPLY SENT BY THE| |||2ND RESPONDENT, DATED 21.1.2008.| |EXT.P9|-|TRUE PHOTOSTAT COPY OF THE MEMORANDUM OF SETTLEMENT| |||ARRIVED BETWEEN KERALA CULTURAL SOCIETY AND THE| |||TRADE UNIONS OF THE WORKERS, DT. 19.2.2000.| /TRUE COPY/ rka P.S.to Judge. A.M.SHAFFIQUE, J. ---------------------------------------------------- W.P.(C) No. 4084 of 2008 - J --------------------------------------------------Dated this the 5[th] March, 2012 **J U D G M E N T** This writ petition is filed by a person who had obtained Ext.P1 award from the Labour Court, Kollam against the Manager, Kerala Times Malayalam Daily, Dr.Sebastian Paul and Mrs. Winnie Abraham. The award directed payment of Rs.2,93,170/- to the petitioner as arrears of wages along with interest from “the assets of Kerala Cultural Society and Kerala Times Daily in the hands of the opposite parties”. It is the contention of the petitioner that though attempts were made, the amounts could not be recovered. Petitioner, further contends that the Kerala Cultural Society which owned Kerala Times Daily is being managed by the 2[nd] respondent i.e. the Archdiocese of Verapoly and therefore recovery proceedings should be taken against the 2[nd] respondent for the amount covered by Ext.P1 award. It is further contended that the 2[nd] respondent Society has not been dissolved and since the entire shares of the Society vests with the 2[nd] respondent, 2[nd] respondent alone has the obligation to pay the amount. -2- W.P.(C) NO.4084 of 2008 - J Petitioner also relies upon Exts.P3, P4, P5, P6 and P7 to support his contention. 2. The 1[st] respondent has filed a counter affidavit stating that though demand notice had been issued to the persons named in Ext.P1, it was contended by them that the recovery should be permitted only against the assets of Kerala Cultural Society and therefore the Village Officer was directed to furnish the property details of Kerala Times and that the solvency of the defaulted firm is awaited. 3. The 2[nd] respondent has filed a counter affidavit denying the liability to pay any amount. According to them, the 2[nd] respondent was not a party and the 2[nd] respondent has nothing to do with Kerala Times. 4. Heard the counsel appearing on either side. 5. The issue is regarding the non-implementation of an award. The respondents in Ext.P1 are not made parties in the above writ petition. An application is filed as I.A.No.7827/2008 to implead the respondents in Ext.P1 as additional respondents 3 to 5. Though the said application was filed, no attempt has been made for taking out notice to the -3- W.P.(C) NO.4084 of 2008 - J additional respondents. Hence the said application is dismissed. 6. The question to be considered in the case is whether the corporate veil of Kerala Cultural Society and Kerala Times daily is required to be lifted in order to impose an obligation on the 2[nd] respondent to pay the amount. It is stated in Ext.P1 order that the liability is that of Kerala Cultural Society. Under normal circumstances the award can be enforced only against the said Society. However, it is contended that several attempts made to find out the assets of the said Society did not give any result and even the existence of the said Society is doubted. It is at this stage that the petitioner had approached this Court for issuing necessary directions to the 1[st] respondent to recover the amount from the 2[nd] respondent, who according to the petitioner, manages and owns the said Society. 7. The counsel for the petitioner also relied upon the judgment in **Kapila Hingorani** v. **State of Bihar** [(2003)6 SCC 1] in order to contend that the corporate veil can be lifted in several situations. It is held that the corporate veil can be pierced when the corporate personality is found to be opposed -4- ## W.P.(C) NO.4084 of 2008 - J to justice, convenience and interest of the revenue or workman or against public interest. Therefore, it is open for the authorities who had been vested with the power to recover the amount under Ext.P1 award to find out the actual persons behind the said Society, if the intention of maintaining the status of the Society is to avoid payment of amount covered by Ext.P1 award. It is needless to state that the award passed by a competent court, or tribunal requires to be implemented with full force and if the persons liable to pay the amount, whether having status of a Society or Company does not discharge their obligation in effecting payment, the statutory authorities should not feel themselves helpless. If it is seen that the Society does not have any asset and there are no persons responsible to settle the liability of the Society, definitely it is open for the statutory authorities to pierce the corporate veil of the Society and to find out the actual persons who are in management of the Society and then take steps according to law. 8. The 2[nd, ] respondent however, contends that it has nothing to do with the Society and therefore it is not possible for -5- W.P.(C) NO.4084 of 2008 - J this Court to consider and pass any order against the 2[nd] respondent without an enquiry in this regard. Hence the relief sought for as against the 2[nd] respondent is hereby rejected. 9. It is still a worrying factor that an award passed on 8.6.2006 is still remaining unexecuted. It is for the 1[st] respondent to take immediate steps to recover the amount covered by Ext.P1 award against the Kerala Cultural Society or Kerala Times as the case may be and if necessary, by lifting or piercing the corporate veil, keeping in mind the principle that no award or order of a Court should be left unexecuted. 10. This is a case where the judgment of the Supreme Court in Kapila Hingorani's case (supra) can be made applicable and therefore this writ petition is disposed of as follows: a. The claim made against the 2[nd] respondent is rejected. b. The 1[st] respondent shall make immediate arrangements to find out the assets of the Kerala Cultural Society, the 1[st] respondent in Ext.P1 and proceed to recover the amount as early as possible and in the event of finding that the Society has no -6- W.P.(C) NO.4084 of 2008 - J assets for effecting recovery, find out the persons behind the corporate veil of the Society and after issuing notice to them, make arrangements to recover the amount in accordance with law. ## **A.M.SHAFFIQUE, JUDGE.** rka