True Court CopyTM English


Civil Appeal No. 1976 of 1998 and Civil Appeal No. 1976 of 1998 4839 of 2005 (Arising out of SLP (C) No. 6016 of 2002)

Decided On: 08.08.2005

Appellants: Binny Ltd. and Ors. Vs. Respondent: V. Sadasivan and Ors.

Hon'ble Judges/Coram:
K.G. Balakrishnan and P. Venkatarama Reddi


K.G. Balakrishnan, J.

1. Leave granted in SLP(C ) No. 6016/2002 and the appeal is heard along with Civil Appeal No. 1976/1998. In these two appeals, common questions of law arise for consideration.

2. In Civil Appeal No. 1976/1998, narration of brief facts is necessary to understand whether the reliefs as prayed for by respondents 2 to 36 could have been granted by the High Court. Each of the respondents was working as member of the management staff of the appellant company, which was engaged in the manufacture of cloth. The respondents were originally appointed in the appellant-company in various jobs such as Clerks, Machine Over lookers , Supervisors, etc. According to these respondents, from 1981 onwards, the appellant company started insisting on them to be designated as management staff with the object of avoiding payment of overtime wages. The respondents signed an agreement with the Management acceding to the request of the appellant company, but they continued to perform the same duties as before. The appellant company contended that there was incessant rain in the night of 12.6.1996 when the entire company premises was flooded with water and it caused serious damage to the plant and machinery and finished-stock and the appellant company stayed all the operations and informed the Commissioner of Labour that water had entered the mill premises causing serious damage to the plant and machinery and management had no other alternative but to suspend the operations of the mill. Order of termination was issued to the respondents invoking Clause 8 of the agreement dated 12.3.1991 entered into by the respondents with the appellant company. As per Clause 8 of the agreement, the Management had a right to terminate the services without assigning any reason by just giving one month's notice or salary in lieu thereof. Appellant contended that all these respondents were drawing salary of more than Rs. 1,600/- per month and they were not 'workmen' under the Industrial Disputes Act, 1947. The respondents filed Writ petition No. 11862/1996 for a Declaration that Clause 8 of the Agreement read with Order of termination dated 31.7.1996 issued by the appellant company was void and illegal and violative of Section 23 of the Indian Contracts Act. The respondents had also contended that the agreement entered into by the respondents with the appellant company was violative of Article 21 of the Constitution and the closure of the mill was against Section 25F and 25N of the Industrial Disputes Act, 1947, and they sought for a direction to reinstate them in service with continuity of service and all consequential benefits. The appellant-company contended that the Writ Petition was not maintainable as the appellant company was a private body; therefore, the question of granting the declaration sought would not arise. It was also contended that there was alternative efficacious remedy available to them and therefore, the discretionary jurisdiction under Article 226 of the Constitution of India should not be exercised. The appellant company also contended that the respondents were not entitled to seek a