S.C.R. beyond what has already been granted by the com- r959 pany. In the particular circumstances of this case, The Tata Oil Mills we order the parties to bear their own costs. Co., Ltd.
v. Appeal allowed. GREAT INDIAN MOTOR WORKS LTD., AND ANOTHER v. THEIR EMPLOYEES AND OTHERS (B. P. SINHA, P. B. GAJENDRAGADKAR and K. N. WANCHOO, JJ.) Industrial Dispute-Award against company in liquidation-
Appeal by managing director and auction-pu.rchaser not aggrieved by the award-Summary dismissal by Appellate Tribunal-Validity- Right of appeal-Industrial Disputes (Appellate Tribunal) Act, z950 (48 of z950), s. z20-Companies Act z956 (I of z956), s. 457. The discharged employees of the Company in liquidation
raised an industrial dispute wherein the auction-purchaser of the Company was also impleaded as a party. The Tribunal, inter alia, held that no relationship of employer and employee existed between the auction-purchaser and the t:ild staff who had been discharged prior to the purchase of the business, and the reference so far as the auction-purchaser was concerned was incompetent. The Tribunal directed the liquidators to pay compensation to the discharged employees.
The liquidators were refused sanction to appeal from the said award by the High Court whereupon the auction-purchaser who was also the managing director of the Company, prior to its liquidation, preferred an appeal in the name of the Company represented by himself as the managing director and also in his capacity as the auction-purchaser of the Company. The Appel- late Tribunal dismissed the appeal in limine as incompetent in view of the provisions of s. 457 of the Companies Act 1956, on the ground that the appeal was not maintainable as it was not authorised by the High Court.
JI eld, that where a party to the Reference in an industrial dispute was exonerated from its terms, and no Award was made against him, he could not be sairl to be an aggrievc-d party, thereby attracting the provisions of s. 12 of the Industrial Disputes (Appellate Tribunal) Act HJSO, and any appeal by him from the said Award will be incompetent.
Its Workmen and Others Wanchooj. I959 May6. r959 No person other than the Official Liquidator, who is placed in charge of the affairs of the Company in the process of winding Great Indian
up, is authorised with the sanction of the Court to institute any Motor Works Ltd., suit, prefer an appeal or other legal proceedings in the name and and Another on behalf of the Company.
v. Held, further, that there is no inconsistency betweens. 457 Their Employees of the Companies Act r956 and s. r2 of the Industrial Disputes and Others (Appellate Tribunal) Act r950. But in construing the provisions of s. r2 of the Industrial Disputes (Appellate Tribunal) Act r950, if there was anything in the Companies Act, r956, with particular reference to s. 457 which was inconsistent with the provisions of Industrial Disputes (Appellate Tribunal) Act r950, the latter Act shall prevail.
Section 457 of the Companies Act r956, concerns a very special case, it only lays down a condition precedent to the filing of a case if it has to be by the liquidator of a company in the process of winding up.
Section 12 of the Industrial Disputes (Appellate Tribunal) Act r950 is the usual statutory provision which permits an appeal to be presented to the Appellate Tribunal, which otherwise would not lie, by any party who is aggrieved. by an award; it docs not either in express terms or by necessary iinplication override, abrogate or modify the provisions of s. 457 of the Com~·anies Act 1956, nor does it do away with the necessity for the requisite sanction of the court which is a condition precedent so far as the liquidator is concerned to institute any suit or proceedings in the name or on behalf of the company in liquidation.
In the instant case the appeal purported to be filed on behalf of the Company in liquidation through its managing director was wholly incompetent ; an.d the second appellant, the auction- purchascr, could not be said to the aggrieved party enabling him to invoke s. 12 of the Act.
CIVIL APPELLATE Ju&rsmc·rrnN: Civil Appeal No. 447 of 1957. Appeal by special leave from the judgment and order dated the 1st August 1956 of the Labour Appel- late Tribunal of India, Culcutta in Appeal No. Cal.-107
of 1956. D. N. Mukherjee, for the appellants. Y. J{ uma.r, for the respondent. 1959. May 6. The Judgment of the Court was delivered by Sinha]. SINIIA J.-This appeal by special leave, is directed
against the order of the Labour Appellate Tribunal, dated August I, 1!)56, dismissing in limine the appeal S.C.R. SUPl~EME COURT REPOR,TS against the Award of the Third Industrial Tribunal,
r959 dated March 8, 1956. The Great Indian Motor Works nd. Ltd., now in liquidation (hereinafter referred to as Mot::~:,k;~~d. 'the Company'), represented by one of the Managing and Another '
Directors, K. D. Nundy, is the first appellant. The v. said K. D. N nndy, in his capacity as the credit.or of Their Employees the Company and/or as the auction-purchaser of the and Others
Company, is the second appellant. One hundred and forty two employees of the Company, represented by the Bus Workers' Union, are collectively the first respondent. The second and third respondents,
C. D. N undy and D. L. Dutt, are the Official Liquida. tors of the Company, appointed by the High Court as such. The relevant facts are these: The Company was incorporated and registered under the Indian Com-
panies Act, 1913, in 1926, as a private limited company with its registered office at Calcutta. Its business was mainly that of carrying on public transport on Route No. 14 in the City of Calcutta, as also of dealers in
and repairers of motor vehicles. It had an authorized capital of six lacs of rupees divided into 600 shares of Rs. 1,000 each, out of 'which, shares worth Rs. 4,00,000 only had been subscribed and paid up. The registered
share-holders of the Company, were Kristo Das Nundy, the second appellant, having 246 shares; Chandy Das Nundy, respondent No. 2, having 142 shares, and Kumar Kartick Charan Mullick, holding 12 shares,
each of the face value of Rs. 1,000. On account of financial difficulties and disputes between its share- holders, an application for compulsory winding up of the Company was made by the said respondent No. 2,
on the Original Side in the High Court at Calcutta.. On July 23, 1951, an order for winding up the Company was made, and the Official Receiver was appointed the Official Liquidator of the Company.
An appeal against the order aforesaid, was dismissed on December 5, 1951, and the order for winding up the Company, stood confirmed. By an order dated December 11, 1951, the Official Receiver was dis-
charged and the respondents 2 and 3 aforesaid, were appointed Joint official liquidators in his place, with Sinha ]. '959 power to sell the business of the Company as a going 1 d'
concern. In April, 1953, the list of the creditors of rea n tan Motor works Ltd .• the Company was settled by the Court, and the second and Another appellant aforesaid, was included in the list as a
v. creditor for the largest amount, namely, Rs. 2,35,818. Their Employees It may be added that the discharged employees of the andOtliers · 1 d d' h 1 ompany were not me u e 111 t e ist of creditors thus
Sinha .r. sottled by the Court. After several infructuous attempts for selling the property by auction, on May 4, 1954, the Court ordered the sale of the Company's business free from all encumbrances, out-goings and
liabilities, to the highest bidder, subject to confirmation by the Court. The second appellant bid for the purchase of the business with the leave of the Court, and he was declared the highest bidder and purchaser
of the business for Rs. 1,42,500 at the sale held on June 12, 1954. The said sale was confirmed by the Calcutta High Court on July 5, 1954. On July 23, 1954, the Official Liquidators issued a notice terminat-
ing the services of all the employees of the Company with effect from July 24, 1954, except one Assistant and one clerk, whose services were retained until the winding up proceedings were completed. On July 24,
the Official Liquidators put the appellant No. 2, the auction-purchaser, in possession of the busi!'1e~s of the Company, which is now being carried on by the second appellant as the sole proprietor.
, As a result of the termination of the services of the one hundred and forty two employees of the Company, as aforesaid, an industrial dispute was raised at the instance of the said employePs whose list is attached
to the order of Reference, dated August 26, 1954, which is in these terms:- "Whereas an Industrial dispute exists between (1) Messrs. Great Inciian l\Iotor Works Ltd., 33, Rowland
Road, Calcutta, represented by their Managing Directors Sri C. D. Nundy and Sri K. D. Nundy, (2) Official Liquidators of the Company, Sri D. L. Dutta and Sri C. D. Nundy, 33, Rowland Road, Calcutta
and (3) Sri K. D. Nundy, Auction Purchaser of the Company, 33, Rowland Road, Calcutta, and their 142, employees, given in the enclosed list, represented by S.C.R. the Bus Workers' Union, 249, Bowbazar Street,
r959 Calcutta, regarding t,he matters specified in the h d 1 reat Indian SC e U e; Motor Works Lid., And whereas it is expedient that the said dispute and Another should he referred to an Industrial Tribunal constitut-
v. ed under section 7 of the Industrial Disputes Act, Their Employees 1947(XIVofl947); andOthers Now, therefore, in exercise of the powers conferred s;,.1iaf. by section 10 of the said Act, the Governor is pleased
hereby to refer the said dispute to the Third Industrial Tribunal constituted under Notification No. 592 Dis./D/12L-5/12 dated the 23rd :February, 1953 for adjudication. The said Third Industrial Tribunal shall meet at
such places and on such dates as it may direct. SCHEDULE 1. Whether the notice dated 23rd July, 1954, of termination of services of 142 employees with effect from 24-7-54 issued by the Joint Official Liquidators,
was justified ? 2. Whether the refusal of the auction-purchaser to continue the employment of the 142 employees was justified? 3. What reliefs are the employees entitled to ? By order of the Governor."
The employees of the Company had moved the High Court for directions to the Liguidators for the payment of their dues from the Company. The Court, by its order dated September 8, 1954, directed the
Liquidators to pay within a week the arrears of salary of all the workmen, and also within a week from receiving sale proceeds of the auction-sale aforesaid, to pay the workers, in lieu of notice, one week's wages to
weekly paid workmen, two weeks' wages to fortnightly paid workmen, and one month's wages to monthly paid workmen. The Directors were to hold the balance of the sale proceeds till further orders of the Court.
It will be noticed from the order of reference, quoted above, that besides the Official Liquidators, the second appellant was also impleaded as a party to the Refe- rence, in his capacity as the auction-purchaser of the
Company. In his written statement before the Third (1960(1)] r959 Industrial Tribunal of West Bengal, which was in Great Indian seizin of the case, the auction-purchaser, now the Jiotor Wmk« Ud., second appellant, aft.er reciting the facts and circum- ond Anoth"
Stances leading up to his auction-purchase, as afore. v. said, contended that as an auction-purchaser, he was Thefr Emptnyccs not in any event liable for any compensation or does, and Others
1 · d b h h b as c anne y t e wor rn1en; t,hat e was not ound to Si11haj. reinstate the old employees of the Company; that having purchased the business free from any encum- brances, he was not Ii a hie for the dues of the workmen,
as claimed ; that he " had unnecessarily been made a party and dragged here before the Tribunal." He added that he admitted that ho was one of the Manag- ing Directors of the Company before its liquidation,
but with the order for liquidation, he ceased to func- tion as such. After hearing the parties, the Tribunal made its Award dated l\Iarch 8, 1955. The Tribunal awarded, inter alia, compensation under section 25(F)(b) of the
Industrial Disputes Act, 1947, and directed the Com- pany to pay compensation, within two months from the date the award became enforceable, to such of the workmen as had been found entitled to the same. It
may be noted here that the proceedings before the Industrial Tribunal had commenced without the necessary sanction of the High Court in the liquida- tion proceedings, but during the pendency of the
proceedings, the High Court, by its order dated Decem- ber 20, 1955, granted leave to the workmen to proceed with and continue the proceedings against the Official Liquidators of the Company. The Industrial Tribunal,
therefore. further direetcd that so far as the Liquida- tors were concPrnt>d, t,he compensation awarded to the workmen '' shall be recoverable only out of the assets in their hands according to law ;'. So far as the
auction-purchaser was concerned, the award proceed- ed to make further directions in these terms : "The auction-purchaser, it has already been noted, purchased the different sections of the business
with the name " The Great Indian Motor Works " free from encumbrances and all outgoings and liabili- ties (Vide Exts. D and E), and the said purchase was S.C.R. confirmed on 5th July, 1954.
After the sale was z959 confirmed and before possession was taken by the t' h th L' 'd t t t d th Great Indian auc 10n-purc aser e 1qm a ors ermd1na e e Motor Works Ltd., employment of a the emp oyees {save an except the
and Another Accountant and one Clerk) by a notice dated 23rd v. July, 1954, with effect from 24th July, 1954. After Their Employees such termination of employment, the auction purchaser
and Others obtained possession on 24th July,11954. At that time Sinha]. no relationship of employer and employees subsisted. In the circumstances the dispute with the auction- purchaser cannot be considered to be ' industrial dis-
pute' as no relationship of employer and employee existed between the auction purchaser and the old staff who had been discharged earlier. Hence I agree with the learned Advocate of the auction-purchaser
that the rMerence so far as the auction-purchaser is concerned is incompetent. Apart from that, when the auction-purchaser purchased the business free from encumbrances and all outgoings and liabilities and
when there is nothing to show that the auction-pur- chaser undertook at any time to maintain the old staff in his service, it cannot be said that his refusal to continue the employment of 142 employees was un-
justified. Only when one purchases with all assets and liabilities as a going concern, he is bound to continue the old employees in service and not otherwise. I award accordingly."
Against the said Award which, in terms, was made only against the Liquidators and not against the auction-purchaser aforesaid, only one of the two Liqui- dators, namely, Debendra Lall Dutt, made an applica-
tion to the High Court for necessary directions regard- ing preferring an appeal. The other Liquidator, Chandy Das :Nundy, opposed the said application for leave to appeal. The High Court, thereupon, made an order
on April 30, 1956, refusing leave to the Liquidators to prefer an appeal from the said Award, It was in those circumstances that the appellants, namely, Messrs. Great Indian Motor Works Ltd., represented
by the Managing Director, K.D. Nundy, as the first appellant, and K.D .. N undy, in his capacity as creditor a.nd/or contributory of the said Great Indian Motor I959 Great Indian Jl,/otor Works Ltd.,
an.d A nothm· v. Their E1nployces and Otltcrs Sinha]. SUPRE1\1E COUR1' REPORTS [1960(1)) Works Ltd. (under liquidation) and/or as auction- purchaser of the Company, as appellant No. 2, filed an
appeal before the Labour Appellate Tribunal of India, on May 3, 11156, impleading the one hundred and forty two employees through the Bus Workers' Union, as the principal respondents, C.D. N undy and D. L. Dutt,
the Official Liquidators of the Company, as pro Jonna respondents. As a counter-blast, the aforesaid work- men of the Company' filed their appeal on May 17, 1956, impleading the Company represented by their
Managing Directors, C. D. Nundy and K. D- Nundy, as the first respondent, the Official Liquidators of the Company, D.L. Dutt and C.D. Nundy, as respondents- second party, K.D. Nundy, the auction-purchaser, as
respondent-third party and the workmen not repre- sented by the Bus Workers' Union, as rn~pondents fourth party. It is not necessary to set out the grounds of appeal in either of the two appeals, in view
of our decision on the preliminary question of the maintainability of the appeal in this Court, as will presently appear. The Labour Appellate Tribunal disposed of the two appeals by its order dated August 1, 1956. The appel-
lants' appeal was dismissed as incompetent in view of the provisions of s. 179 of Indian Companies Act, 1913, re-enacted as s. 457 of the Companies Act, 1956. The dismissal of the appeal on the ground of
the appeal not being competent; was based on the order of the Calcutta High Court, dated April 30, 1956, aforesaid, refusing leave to the Liquidators to prefer an appeal. It is noteworthy that the appeal before
the Appellate Tribunal, was not by the Liquidators but by K.D. N undy as Managing Director of the Com- pany, as also by him in his capacity as the creditor or contributory or as the auction-purchaser of the Com-
pany. This aspect of the case has not been dealt with by the Tribunal which held that the appeal was not maintainable as it was not authorised by the High Court. The employees' appeal also was dismissed as
it was not pressed in view of the fact that the appeal by the Company stood dismissed t.s unauthorized. lt was against the aforesaid order of the Appellate S.C.R. Tribunal, dismissing the appeal in liminc, tlHtt the
I959 appellants aforesaid moved this Couet and obtained 11 d. d . l l f" k rca n ian special leave to appeal, an tie mam gronn< o attac , Motor Works Ltd., naturally, was that the .Labour Appellate Tribunal was
and Another in error in di1m1is:;ing the appeal as unanthorisecl or as v. not maintainable. Thczr .c:mployees ·c ll d · th fi und Otlz11rs t IS nu1ru1e;;t t· rnt we are C<L c upon, 111
• e rst instance, to decide ,\·hother the Labour .Appellate Tribunal had rightly dismissed the appeal in limine ·ou the ground that t.110 Liqui<lators had failed to obtain the necessary sanctioH of th1:1 Calcutta High Court to
prefer an a.ppeal fl'Olll the Awtted of the Industrial Tribunci.J. If that ur<lcr of Lhe Appellate ~rribunal is correct, and if we Jiud that the appellants could not have any locn8 .stawli to prefer a.u appeal of their own
as distinct from that on behalf of the Company, no other 4uesi,ion would <trise for determination in this case. If~ on the other hand, we come to the conclusion that that order w11s erroneon::;, at least in respect of
the ap:1ellant<.;' arpeal, then the appeal will have to be remanded to be re-heard L.v the Appellate Tribunal. It ha.s been urged on hchalf of the a.ppellants that. in view of the provisions of s. 12, read with s. 3, of the Industrial Di<iputes
(Appellate~ T1·ibnnal) Act. (48 t1f 1950) (which was repealed by Act 36 of 1956), which governed t.he making of a.ppe"'ls before the Appellate Tribunal, the appea,l to that Tribunal was competent,
and should have been heard and determined on merit.s. The provisions of ss. 3 11.ml 12, which we have to construe in this case, are in these tcrnis :- " 3. The provi;;ions of this Act and of the rnlei:i
and ordcn; made thereunder shall have effect notwith- standing anythillg iuconsidt.ent therewith eouta.ined in '1.ny other law for the time being ia force or in any instrument having effect by virtue of any such law."
" 12. An appeal under this Act against any award or decision of an industrial tribunal may be presented to the Appellate Tribunal hy- (i) any party which is aggrieved by the award or
decision ; or Sinha J. [1960(1)] r959 (ii) the appropriate Government or the Central Government, where it is not the appropriate Govern- M Greawt Inkd•aLn d ment, whether or not such Government is a party to otor
OY S t ., th d• t ,, and Another e ISpU e . . v. \Ve h>t ve first to determine whether there is anything Their Employees in the Indian Companies Aet, with particular reference and Others
to s. 179 of the Indian Companies Act, 1913, (re- Sinha J. enacted as s. 457 of the Companies Act, 1956), that is inconsistent with the provisions of the Industrial Disputes (Appellate Tribunal) Act, 1950 (which herein-
after will be referred to as "the Act"). If there is anything in those provisions of the Companies Act, inconsistent with th" provisious of the Act, the latter shall prevail. Hence, we have to construe the provi-
sions of s. 12 which specifically deals with appeals. That section permits an appeal to be presented to the Appellate Tribunal by r,ny party which is aggrieved by the a ward (omitting the words not necessary for our
present purpose). It is the usual statutory provision for an appeal, which otherwise would not lie. It does not say either in ex press terms or by necessary impli- cation, that those specific provisions of the Companies
Act, are abrogated or modified. It does not do away with the necessity of the requisite sanction of the Court so far as a Liquidator is concerned. Under the provi- sions of the lndiau Companies Act, the affairs of the
company under liquidation, are placed in charge of the Official Liquidator, and under s. 457, it is only the Liquidator who is authorized with the sanction of the Court, to institute any suit or other legal proceedings
in the name and on behalf of the company. Thus, there is no inconsistency between the aforesaid provi- sions of the Act and the Companies Act, which only laid down a condition precedent to the filing of an
appeal, if it has to be, by a Liquidator of a company in the process of winding up. It concerns a very special case and has no bearing on the general right of appeal. As, in the instant case, the Court refused the
necessary sanction to the Liquidators to prefer the appeal, no appeal could have been filed on behalf of the Company. Hence, in so far as the appeal purported to be on behalf of the Compa11y, through the Managing
S.C.R. Director aforesaid, it was wholly incompetent. But r959 the appeal was not only by the Company as such, but 11 d" K D N d h d. rea n ian also by the said un y as t e ere itor or contri- Motor Works Ltd.,
butory or auction-purchaser of the Company. So far and Another as this part of the appeal is concerned, it is clear that v. only a pa.rty to the Reference aggrieved by the Award Their Employees 1rnd Others
could be a party to the appca. K .. D. Nundy was not a Party in his c.bpacity as creditor or as contributorv. . s· h 1 . "' a . He was impleaded, as already ir-iicated as a party to
the Reference in his capacity as ;,fie auction-purchaser of the business of the Company. So far as that capacity is concerned, it is clear from the order of the Tribunal, that no award was made against him as such.
He could not, therefore, be said to be a party aggrieved by the award, having been exonerated from its terms. The Tribunal put this on three main grounds-(1) that the auction-purchaser had purchased the business of
the Company free from all encumbrances, out-goings and liabilities, (2) that tho employment of the work- men had been terminated hy the Liquidators before possession of the business was delivered to the auction-
purchaser, and (3) that there was no relationship of employer and employees between the auction-purchaser and the workmen whose services were so terminated. The Tribunal, in that view of the matter, declared
the Reference to be incompetent in so far as the auction-purchaser was concerned. Thi;;: order, the Tribunal passed at the instance of the auction- purchaser himself. Th0 auction-purclu1-ser, therefore,
succeeded in obtaining the order which the Tribunal passed, holding that the R<:'forence, so far as he was concerned, was incompetent. In view of these facts, it must be held that so far as the auction-purchaser is
concerned, he was not aggrieved by the Award made by the Industrial Tribunal. That being so, the provi- sions of s. 12 of the Act, are not attracted to the appeal purported to have been filed by the auction-purchaser.
It is a little difficult to appreciate why the auction- purchaser, having succeeded in obtaining the order, set out above, in his favour, changed his mind and prefer- red an appeal which, in the events that had happened,
was not maintainable. Great Indian Motor Works Ltd., and A ·not her v. Their E1nployees and Others Sinha]. Jt,[ay6. ''\. In our opinion, therefore, the Labour Appellate Tribunal was not in error in dismissing the appeal by
-1111 the Company and by the auction-purchaser, as in- competent. It follows, therefore, that we are not con- cerned with the merits of the appeal. In view of the fact that we have not expressed any opinion on the
merits of the controversy raised in the abortive appeal, this dismissal shall be without prejudice to the appel- lants' rights, if any. The appeal is, accordingly, dis- missed, but the parties here are directed to bear their
own costs, in view of the fact that we have not gone into the merits of the controversy. Appeal clismi8ser.l. MESSRS. ISPAHANI LTD. CALCUTTA v. ISP AHANI EMPLOYEES' UNION (B. P. SINHA, P. B. GAJENDRAGADKAR and
K. N. WANCHOO, JJ.) Industrial Dispute-Puja Bonus-Implied agreement-Tes/- Benefits arising out of service with employer's predecessors-Worlmten if entitled to. The workmen were originally employed by M/s. M.M. Ispahani Ltd., which shortly before the partition of India transferred its registered office from CO:Icutta to Chittagong. The appellant company was incorporated on September 15, 1947 and took over the good-will and trading rights of M/s. M. M. Ispahani Ltd. and also purchased its stock-in-trade, properties and assets.
Most of the shares of the appellant were held by M/s. M. M. Ispahani Ltd. and the business of the appellant was of the same nature carried on in the same premises with the san1e workmen on the same remuneration. On the transfer of M/s. M. M. Ispahani Ltd. to Chittagong the question arose of retrenching those workmen who were not willing to go to Chittagong and when the appellant company came into existence it agreed to employ those workmen. The workmen apparently agreed to the termination of their
services with M/s. M. M. Ispahani Ltd., and after receiving their provident funds and arrears of salaries they were appointed by the appellant. M/s. M. M. Ispahani Ltd. used to pay puja bonus to the workmen at the rate of one month's wages and the appellant also paid the same from 1948 up to 1952, even in the years in which the appellant suffered losses. As the appellant did not pay puja bonus for 1953, a dispute arose and was referred for