Remanded

Shri. Santosh Kanta Assoldekar v. the Official Liquidator of M/S. National Auto Accessories Ltd. (in Liquidation)

Bombay HC17 Sept 2010COA/8/2009

Case brief

AI extract

What is this about?

In Company Appeal No. 8 of 2009, the High Court of Bombay allowed the appellant's appeal against the Official Liquidator's partial rejection of his claim. The Court held that the Liquidator failed to address the appellant's specific plea that the settlement barring his claim was void due to non-compliance with Section 25-O of the Industrial Disputes Act. The matter was remanded to the Liquidator t

What did the court decide?

The appeal was allowed, and the matter was remanded to the Official Liquidator to decide the issue of the settlement's validity under Section 25-O and determine the claim afresh.

Shri. Santosh Kanta Assoldekar Vs the Official… — Company and Corporate | Bombay HC (2010)

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IN THE HIGH COURT OF BOMBAY AT GOA

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COMPANY APPEAL NO. 8 OF 2009

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SHRI. SANTOSH KANTA ASSOLDEKAR ... Appellant Versus THE OFFICIAL LIQUIDATOR OF M/S. NATIONAL AUTO ACCESSORIES LTD (IN LIQUIDATION) ... Respondent

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Mr. D. J. Pangam, Advocate for the Appellant.

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Mr. P. Sridharan, Jr. Technical Assistant in person for respondent.

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Coram:D. G. KARNIK, J. Date:17th September, 2010

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P.C.

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Heard learned Counsel for the petitioner. Counsel for Official Liquidator is absent.

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Representative of the Official Liquidator Mr. P. Sridharan, Jr. Technical Assistant who is present in the court prayed for adjournment on the ground that the Counsel for Official Liquidator has not come. Request is rejected as it is made after the arguments of the appellant are over. Opportunity was then offered to the representative of the Official Liquidator to address the Court but he declined.

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The appellant challenges the order dated 20.2.2009 passed by the Official Liquidator partly rejecting the claim of the appellant.

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By a letter of appointment dated 30.4.1990 the appellant was appointed as workman by the National Auto Accessories Ltd. (hereinafter referred to as the company).

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The Company went in liquidation and order for winding up the Company was passed in the year 2001. The Official Liquidator took charge of the Company and issued notice in the newspapers inviting claims. The appellant who was a workman employed by the company made a claim for the past wages and also for retrenchment compensation, gratuity, leave encashment and bonus. The claim was rejected by the Official Liquidator by order dated 22.11.2006. That order was set aside by this Court in Company Appeal No. 2/2006 on the ground that the Official Liquidator had failed to follow the provisions of Rule 163 of the Companies (Court) Rules, 1959. This Court remanded the claim back to the Official Liquidator to reconsider the claim of the appellant.

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Thereafter the appellant, by another communication dated 10.4.2007, justified his claim. By an order dated 20.2.2009 the Official Liquidator allowed the claim of the appellant only to the extent of Rs. 9617.22 but rejected rest of the claim of Rs. 6,40,454.00. Aggrieved by the said decision, the appellant has filed this appeal.

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Perusal of the order of the Official Liquidator shows that Official Liquidator has rejected the claim on the ground that prior to the closure of the company there was settlement arrived at between the company and the Trade Union of the workmen on 9.4.2001 and under the terms of settlement the company had paid to the appellant sum of Rs. 16933.55. In view of the settlement, the appellant was not entitled to the wages and other benefits which had been settled under the agreement dated 9.4.2001.

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Learned Counsel for the petitioner submits that the settlement arrived by the company with the Registered Union was not valid. The company closure was not done with prior permission of the

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appropriate Government under Section 25 N and Section 25-O of the Industrial Disputes Act, 1947 and therefore, the settlement was void and not binding on the appellant. In support of his contention the learned Counsel relied on the decision of the Supreme Court in the case of Oswal Agro Furane Ltd. Vs. Oswal Agro Furane Workers Union & Ors., 2005 (1) CLR 816. In that case the Supreme Court has held that if its closure is effected without obtaining prior requisite permission, the settlement would be void and the workmen would be entitled to all the benefits in terms of Section 25 O of the Industrial Disputes Act.

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The appellant has specifically claimed before the Liquidator that the settlement was void and illegal. In his letter dated 10.4.2007 he had stated "In this regard I submit that the settlement dated 9.4.2001 is illegal, null and void as the closure which have been ordered under the said settlement as procedure under Section 25 (0) of Industrial Disputes Act has not been complied with before closure". The contention of the appellant that the settlement was void and the closure was illegal as it was contrary to the procedure under Section 25-O of the Industrial Disputes Act was specifically pleaded before the Liquidator. Copy of the judgment in the case of Oswal Agro Furane (supra) was also filed before the Liquidator. The Liquidator has not dealt with this contention while rejecting the claim of the appellant. Consequently the order of the liquidator is required to be set aside.

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The Liquidator ought to have answered the issue which was raised before him that the settlement was illegal and consequently the appellant was entitled to the benefits without reference to the settlement. Since the issue has not been considered by the Liquidator, it is necessary to remand back the appeal to the Liquidator for his

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consideration.

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For these reasons the appeal is allowed. The matter is remanded back to the Official Liquidator to decide the issue raised by the appellant that the settlement is not binding on him as it is contrary to Section 25-O of the Industrial Disputes Act and decide the claim of the appellant afresh.

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D. G. KARNIK, J.

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MF/-

Shri. Santosh Kanta Assoldekar v. the Official Liquidator of M/S. National Auto Accessories Ltd. (in Liquidation)

Case brief

What is this about?

What did the court decide?

Shri. Santosh Kanta Assoldekar v. the Official Liquidator of M/S. National Auto Accessories Ltd. (in Liquidation)

Case brief

What is this about?

What did the court decide?

What the court decided

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