Berger Paints India Limited v. Presiding Officer Labour Court, Ernakulam and Ernakulam Shops and Commercial Employees' Union (CITU)

**IN THE HIGH COURT OF KERALA AT ERNAKULAM** **PRESENT:** **THE HONOURABLE SMT. JUSTICE P.V.ASHA** **MONDAY, THE 30TH DAY OF JULY 2018 / 8TH SRAVANA, 1940 WP(C).No. 4462 of 2017** **PETITIONER:** **BERGER PAINTS INDIA LIMITED REGIONAL OFFICE, DOOR NO. III/835C, FIRST FLOOR, VALIYARA CHAMBERS, K.K. ROAD, CHEMBUMUKKU, KOCHI-682021, REPRESENTED BY ITS REGIONAL MANAGER, N.I. JOSEPH, AGED 43 YEARS, S/O.N.P. IVANIOUS. BY ADVS.SRI.B.ASHOK SHENOY SRI.K.V.GEORGE SRI.P.N.RAJAGOPALAN NAIR SRI.P.S.GIREESH SRI.RIYAL DEVASSY KUM.POOJA DILIP** **RESPONDENT(S):** **1. THE PRESIDING OFFICER LABOUR COURT, ERNAKULAM, KOCHI-682031.** **2. ERNAKULAM SHOPS AND COMMERCIAL EMPLOYEES UNION (CITU), MARUTHI VILAS, CANON SHED ROAD, ERNAKULAM , KOCHI-682011, REPRSENTED BY ITS GENERAL SECRETARY.** **R1 BY GOVERNMENT PLEADER SRI.SUNIL KURIAKOSE R2 BY ADV. SRI.S.KRISHNA MOORTHY(ERNAKULAM),SC** **THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 3-07-2018, THE COURT ON 30-07-2018 DELIVERED THE FOLLOWING:** **PBS** **WP(C).No. 4462 of 2017 (G)** ## **APPENDIX** ## **PETITIONER(S)' EXHIBITS** - **P1 TRUE COPY OF THE G.O(RT) 48/2015/LBR DATED 12/01/2015 ISSUED BY GOVERNMENT OF KERALA P2 TRUE COPY OF THE CLAIM STATEMENT DATED 18/05/2015 FILED BY THE 2ND RESPONDENT BEFORE IST RESPONDENT, IN I.D NO. 4 OF 2015** - **P3 TRUE COPY OF THE WRITTEN STATEMENT DATED 26/08/2015 FILED BY THE PETITIONER BEFORE THE IST RESPONDENT, IN I.D 4/2015** - **P4 TRUE COPY OF THE REJOINDER DATED 28/09/2015 FILED BY THE 2ND RESPONDENT BEFORE THE IST RESPONDENT, I.D 4/2015** - **P5 TRUE COPY OF THE AWARD DATED 26/09/2016 IN I.D 4/2015, PASSED BY IST RESPONDENT** ## **RESPONDENT'S EXHIBITS** ## **I.A. NO. 5239/2017** - **R2(A) TRUE COPY OF LETTER DATED 19/01/2017 SUBMITTED BY AGGRIEVED WORKMAN RAMESH KAMATH.** - **R2(B) TRUE COPY OF LETTER DATED 19/01/2017 ISSUED BY MANAGEMENT TO AGGRIEVED WORKMAN RAMESH KAMATH.** - **R2(C) TRUE COPY OF LETTER DATED 19/01/2017 SUBMITTED BY AGGRIEVED WORKMAN S. LAKSHMI.** - **R2(D) TRUE COPY OF LETTER DATED 19/01/2017 ISSUED BY MANAGEMENT TO AGGRIEVED WORKMAN S. LAKSHMI.** - **R2(E) TRUE COPY OF LETTER DATED 19/01/2017 SUBMITTED BY AGGRIEVED WORKMAN M.N. RANJITH.** - **R2(F) TRUE COPY OF LETTER DATED 19/01/2017 ISSUED BY MANAGEMENT TO AGGRIEVED WORKMAN M.N. RANJITH.** - **R2(G) TRUE COPY OF LETTER DATED 19/01/2017 SUBMITTED BY AGGRIEVED WORKMAN C.J. BEJOY.** - **R2(H) TRUE COPY OF LETTER DATED 19/01/2017 ISSUED BY MANAGEMENT TO AGGRIEVED WORKMAN C.J. BEJOY.** ## **WP(C).No. 4462 of 2017 (G)** |**EXHIBIT R2A**|**TRUE COPY OF THE COMMON ORDER OF THE HON'BLE LABOUR**| |---|---| ||**COURT IN MP. MOS. 02/2015, 03/2015, 04/2015 AND 05/2015.**| |**EXHIBIT R2B**|**TRUE COPY OF THE COMPLAINT FILED BY THE DISTRICT LABOUR**| ||**OFFICER BEFORE THE HON'BLE JUDICIAL FIRST CLASS**| ||**MAGISTRATE COURT AT KAKKANAD.**| **/TRUE COPY/ PS TO JUDGE** **PBS 1/08/2018** ## _**P.V.ASHA, J.**_ -------------------------W.P(C) No.4462 of 2017-G ------------------------------------------- _Dated this the 30[th] day of July, 2018_ ## _**JUDGMENT**_ Ext.P5 award of the Labour Court, Ernakulam is under challenge in this writ petition filed by the Management of the Berger Paints India Ltd., which is a Public Limited Company. 2. The issue referred for adjudication in Ext.P1 to the Labour Court, Ernakulam was justifiability of transfer of 4 employees of the petitioner. It was numbered as I.D.4 of 2015. The petitioner transferred 4 of its employees from their Cochin Depot to Chennai, Hyderabad, Goa and Bangalore saying that their depot at Cochin was closed down and therefore it was necessary to transfer the employees, who were working in their Cochin depot to other depots/offices under them. The 2[nd] respondent Union filed Ext.P2 claim statement and the petitioner filed Ext.P3 written statement to which the 2[nd] respondent filed Ext.P4 rejoinder. The allegation of the 2[nd] respondent was that the transfer amounted to unfair labour practice and victimisation. The contention of the petitioner was that the godown at Cochin had become inoperative. It was stated that on account of the W.P(C) No.4462 of 2017-G 2 obstructions against its functioning from 30.8.2013 onwards it had to be closed down and there was no victimisation or unfair labour practice. 3. The workmen claimed that they had submitted a charter of demands for wage revision. As the petitioner was engaging workers through an outsourcing agency for several years, the trade union took up their case for regularisation and had submitted a charter of demands. When the conciliation meetings did not have any positive results, the workers under the 1[st] respondent went on strike from 30.08.2013 after giving notice, demanding regularisation and wage structure for the workers engaged through the outsourcing agency. The management opened a new depot at Aroor and recruited fresh hands to carry out the operations in the godown. They transferred 4 workmen who were office bearers and active workers of the trade union. 4. But the management in their written statement stated that the godown at Kochi became redundant due to obstructions from 30.08.2013, resulting in its closure on 31.03.2014 and that was also a reason for transfer of the workmen, apart from administrative exigencies. It was stated that the godown at Aroor was opened by one of their C&F agencies and they did not recruit additional workmen. 3 W.P(C) No.4462 of 2017-G 5. The workmen filed rejoinder asserting that the petitioner was adamant in not opening the godown even after the strike was withdrawn and stating that new godown was opened by the petitioner to defeat the strike and closure was a lock out to defeat the workmen and that the business operations of the petitioner continued even after the closure; the closure was in retaliation of the strike launched by the workmen which amounts to victimisation. It is pointed out that the workmen did not join duty pursuant to the orders of transfer and their services were terminated after conducting a domestic enquiry. 6. Before the Labour Court, MW1 was examined and Exts.M1 to M19 were marked on behalf of the management. WW1 to WW3 were examined and Exts.W1 to W33 documents were marked, on behalf of workmen. The Labour Court found that the transfer amounted to victimisation and held that it was unjustifiable. 7. The contention of the petitioner is that the finding of the Labour Court is perverse and rendered in the absence of any pleadings or evidence relating to victimisation. It was alleged that the Labour Court ought not have entered into the question regarding the closure of the depot or the reasons thereto. According to them, transfers were resorted to in order to avoid 4 W.P(C) No.4462 of 2017-G retrenchment. But the Labour Court failed to assess the evidence correctly and arrived at a finding that the transfer was unfair and unjust. 8. The learned counsel for the petitioner relied on the judgments of this Court in _**Indian Hume Pipe Co. Ltd. v. Their Workmen**_ [1968 KHC 234 : AIR 1968 SC 1002], _**Savani Transport Pvt. Ltd. v. Savani Transport Employees' Assn.**_ [1994 KHC 164] and _**Kalinga Tubes Ltd. v. Workmen**_ [1969 KHC 657 = AIR 1969 SC 90], _**Peirce Leslie India Ltd. v. Secretary, C.I.T.U**_ [2006 KHC 269], _**Pottery Mazdoor Panchayat vs. Perfect Pottery co.Ltd and another**_ : (1979) 3 SCC 762 _**, Savani Transport Pvt. Ltd. Vs. Savani Transport Employees' Assn. : 1994 KHC 164**_ : 1994 (1) KLT 764 _**Hondaram Ramchandra (M/s.) v. Yeshwant Mahadev Kadam**_ [2007 KHC 7868 : 2007 (14) SCC 277], _**District Red Cross Society v. Babita Arora & Ors.**_ [(2007) 7 SCC 366], _**Kerala State Cashew Development Corporation, Kollam vs. Labour Court, Kollam and others**_ : 2016 KHC 616 etc. 9. The learned counsel for the workmen relied on the judgment of the Apex Court in _**Bhuvnesh Kumar Dwivedi v. M/s. Hindalco Industries Ltd.**_ [(2014) 11 SCC 85], _**Harjinder Singh v. Punjab State Warehousing Corporation**_ [(2010) 3 SCC 192], _**Jaipur Zila Sahakari Bhoomi Vikas v. Ram Gopal Sharma & Ors.**_ [(1994) 6 SCC 522], the judgment in _**Syed**_ W.P(C) No.4462 of 2017-G 5 _**Yakoob vs. K.S.Radhakrishnan and ors.**_ : AIR 1964 SC 477 and _**General Manager, Oil and natural Gas Commission, Silchar vs. Oil and natural Gas Commission Contractual Workers Union**_ : (2008) 12 SCC 275, etc. and argued that the judicial review of the award of Industrial Tribunal or Labour Court is limited to cases where the award is perverse or is passed on misplaced sympathy, High court is not expected to reappraise the evidence in order to arrive at a different conclusion. Therefore, according to the learned counsel for the petitioner, the award passed by the Tribunal is not liable to be interfered with. 10. I have considered the contentions on both sides with reference to the pleadings as well as the records. In the present case, the Tribunal has, after taking note of the well settled legal position that it is not expected to go into the question of motive behind closure, considered the evidence on record and found from all the correspondence between the management and the trade union starting from April, 2012 onwards regarding the demand for revision of wages and the strike thereafter from 30.8.2013 for which notice was issued in December 2012, leading to transfer of the petitioners. The Labour Court also found from the correspondence by the union with the management and the District Labour Officer before and after the indefinite W.P(C) No.4462 of 2017-G 6 strike and the transfer, and found that the management did not bring on record any reason for transferring the workmen. It did not accept the contention that transfer was to avoid the termination of their services, consequent to closure of godown. It was also found that the godown alone was closed while the office of the management continued to function in Chembumukku and therefore the establishment continued its operation in Kochi also and the transfer of the workmen was found to be as a measure of victimization. The Labour Court arrived at the conclusion on the basis of evidence adduced before it. The demands made by the trade union, the notice to go on with strike, the commencement of strike on 30.08.2013; the disruption to the functioning of the godown at Cochin by those on strike; the consequent proposal of the management to close down the godown at Cochin; simultaneous opening of another unit in the adjacent district recruiting additional force in it, are all found from materials on record before the Labour Court. It was also found that two of the workmen, who were transferred, were office bearers of the union and other two were active members of the trade union which submitted the charter of demands; they were active participants of the strike which disrupted the functioning of the depot at Kochi and the transfer ordered in the midst of these only amounted 7 W.P(C) No.4462 of 2017-G to victimisation. In this back ground, the Labour Court also found that as long as there is no finding as to legality of the strike or as to the closure, the transfer of the workmen who were in the forefront of the strike can only be found as a measure of victimisation. Though the case of the management was that the transfer was ordered in order to avoid termination, the Tribunal repelled the same considering the circumstances under which the transfer happened to be ordered. The contention of the learned Counsel for the petitioner is that the Tribunal erred and exceeded its jurisdiction in going into the legality of closure and that of strike. 11. From the records it is seen that MW1 himself has admitted W13 letter dated 18.10.2013, by which the management informed that they were forced to open new depots around Kochi and engaged additional manpower under compelling circumstances since the company was not allowed to operate. It was stated that the company does not want any godown and at the same time the office will continue to operate for administrative work. It was also informed that excess manpower would be redeployed or compensated. The proposal for re-deployment was also placed before the conciliation officer in which the transfer of the workmen was proposed. On the basis of all these documentary evidence, the Labour Court found that the transfer 8 W.P(C) No.4462 of 2017-G was a measure of victimisation on account of the strike launched by them, which was not illegal. 12. From the records it is seen that MW1 deposed that on closure of the godown at Kochi, the dealers from Kochi are dealt with by the depot at Alleppey and the Depot at Trissur. It is based on this oral testimony coupled with the documentary evidence that the Labour Court came to the conclusion that though the employees were holding transferable posts and the management raised the contention that the transfer was ordered to avert termination, the transfer was ordered as a measure of victimisation. Though the management attempted to show that the office at Chembumukku was the regional office and no business operation takes place in Kochi, W13 disproved the same. 13. In this context it is necessary to examine whether the Labour Court exceeded its jurisdiction, as argued by the learned Counsel for the petitioner, in the light of the judgments relied on. In the judgment in _**Indian Hume Pipe Co. Ltd. v. Their Workmen**_ [1968 KHC 234 : AIR 1968 SC 1002], the Apex Court was considering a case where a factory was closed down after the Mines Department had declared that its premises were unsafe and there was subsidence of earth. Though enquiries to find out another 9 W.P(C) No.4462 of 2017-G place was made, it was not found feasible. Notice of closure was thereafter issued followed by notice of termination to the workmen. The factory was closed down in December 1964. But the Tribunal, found that the closure was mala fide in order to dispense with the services of the workmen. In those circumstances, it was held that once the closure was found real and bonafide, the Industrial Tribunal need not go into the motive and to find out mala fides based on the past history of the disputes between employer and employee. In this case, the Labour Court has only analysed the evidence before it and found that the transfer was ordered at the time when conciliation proceedings were going on, at the demands of trade union and strike of the workmen and immediately after they called off the strike. The Labour Court only observed that there is no finding on the legality of closure or illegality of strike. The management itself stated that they opened new depots and recruited additional workforce. 14. In the judgment in _**Kalinga Tubes Ltd. v. Workmen**_ [1969 KHC 657] the Apex Court held that if there has been a closure, the Tribunal or the court has to take into account the entire set of circumstances, as the management may decide to close down an undertaking because of financial or business reasons or when it was felt either dangerous from the point of 10 W.P(C) No.4462 of 2017-G view of the safety of the staff and members of the management or employees to carry on the business. In that case, it was observed that a large number of workers staged a gherao during several hours keeping 40 of the members of the administrative staff confined inside the building without allowing them to take food and stopping ingress and egress till the Police came to rescue. It was found that closure in the aforesaid background cannot be said to be not genuine, but it was the management's prerogative to close down the undertaking. Management served the notice of closure as well as compensation to workmen. It was found that only compensation was liable to be paid to the workmen on closure of the establishment. 15. In the judgment in _**Pottery Mazdoor Panchayat vs. Perfect Pottery co.Ltd and another** : (1979) 3 SCC 762_ also the Apex Court held that the question of propriety or justification for closure of a business cannot be raised in an industrial dispute. In _**Savani Transport Pvt. Ltd. Vs. Savani Transport Employees' Assn.**_ : 1994 KHC 164 : 1994 (1) KLT 764, the closure itself was the issue for adjudication. The contention of the management was that each of the branches sought to be closed were independent units; whereas the workers claimed that there was only a single unit. Following the judgments of the Apex Court it was held that the 11 W.P(C) No.4462 of 2017-G Tribunal cannot go into the motives behind closure and it had only to look into the bonafides behind closure. The re-instatement ordered by the Tribunal was interfered with. 16. In the judgment in _**Peirce Leslie India Ltd. vs. Secretary, C.I.T.U**_ : 2006 KHC 269 : 2006 (1) KLT 869, a Division Bench of this Court was considering the question regarding the liability of the management to provide reemployment under section 25H of the ID Act even in the event of a valid retrenchment and whether it would cease on expiry of one year period. The question whether the workmen could claim re-employment in a case of closure of an undertaking was also considered on reference. A learned single Judge of this Court held that the Industrial Tribunal cannot go into the question of the motive behind the closure. In the judgment in _**Isha Steel Treatment, Bombay v. Association of Engineering Workers, Bombay & Ors.**_ [1987 (1) LLJ 427] the Supreme Court held that it was not necessary that the management should close down all the branches of its business. The closure can also be a part of the business or activities. 17. In the judgment in _**Hondaram Ramchandra (M/s.) v. Yeshwant Mahadev Kadam**_ [2007 KHC 7868 : 2007 (14) SCC 277], the Apex Court was considering a case where the industrial dispute was raised by the 12 W.P(C) No.4462 of 2017-G workmen demanding re-instatement. There the sales office of the employer was closed down. The workmen were transferred to another legal entity. When they did not join duty, their services were terminated after conducting a domestic enquiry. Later the shop itself was sold. Though it was observed that the workmen were not entitled to re-instatement when there was closure, it was also found that transfer was not a legal one. There the question which came up for determination was whether the closure was effected in 1983 or 1991. The Apex Court found that it was not possible to determine when the closure was effected or to determine the effect of termination and therefore directed payment of compensation. 18. In the judgment in _**Kerala State Cashew Development Corporation, Kollam vs. Labour Court, Kollam and others**_ : 2016 KHC 616, the issue raised before the Labour Court was regarding denial of employment consequent to closure of the unit. In that case the workshop in which the workmen were employed was closed, since it was not viable. It was observed that if the entire establishment of the employer is not closed down but only a unit or undertaking, which has no functional integrity with other unit or undertaking is closed down, provisions of Section 25 FFF of the Act would get attracted and workmen would only be entitled to 13 W.P(C) No.4462 of 2017-G compensation. This Court found that there was no question of denial of employment and the workmen were only entitled for compensation. 19. In the present case, the Labour Court found that the decision for closure was taken after the strike and the management started a new unit. Going by the definition of closure though it is sufficient to close even a branch or a unit of an establishment, it is also settled law that if there is no functional integrality between each units, even a branch can be closed down and that the Tribunal shall not go into the reasons behind the closure. In this case the Labour Court has passed the award on a proper assessment of the evidence, both the documentary and oral evidence on record. 20. As rightly pointed out by the learned counsel for the respondents, interference to the award of the Labour Court is very limited. The following observations of the Apex Court in _**Bhuvnesh Kumar Dwivedi**_ _**v. Hindalco Industries Ltd.**_ : (2014) 11 SCC 85 _,_ reiterating the view in _**Harjinder Singh**_ 's case ( _supra_ ) are relevant in this context: _“21. The judgments mentioned above can be read with the judgment of this Court in Harjinder Singh case, the relevant paragraph of which reads as under: (SCC p. 205, para 21)_ _“21. Before concluding, we consider it necessary to observe that while exercising jurisdiction under Articles 226 and/or 227 of the Constitution in matters like the present one, the High Courts are duty-bound to keep in mind that the Industrial Disputes Act and other similar legislative instruments are social welfare legislations and the same are required to be interpreted keeping in view the goals set out in the Preamble of the Constitution and the provisions contained in Part IV thereof in general and Articles 38, 39(a) to (e), 43 and 43-A in_ 14 W.P(C) No.4462 of 2017-G _particular, which mandate that the State should secure a social order for the promotion of welfare of the people, ensure equality between men and women and equitable distribution of material resources of the community to subserve the common good and also ensure that the workers get their dues. More than 41 years ago, Gajendragadkar, J. opined that:_ _‘10. … The concept of social and economic justice is a living concept of revolutionary import; it gives sustenance to the rule of law and meaning and significance to the ideal of welfare State.’_ _(State of Mysore v. Workers of Gold Mines, AIR p. 928, para 10.)”_ _22. A careful reading of the judgments reveals that the High Court can interfere with an order of the Tribunal only on the procedural level and in cases, where the decision of the lower courts has been arrived at in gross violation of the legal principles. The High Court shall interfere with factual aspect placed before the Labour Courts only when it is convinced that the Labour Court has made patent mistakes in admitting evidence illegally or have made grave errors in law in coming to the conclusion on facts. The High Court granting contrary relief under Articles 226 and 227 of the Constitution amounts to exceeding its jurisdiction conferred upon it.”_ In these circumstances, I am of the view that Ext.P5 award cannot be said to be perverse or based on no evidence or based on evidence which is not legally acceptable. Therefore, the writ petition is dismissed. Sd/- _**(P.V.ASHA, JUDGE)**_ _rtr/_