- (1.) ON 25th December, 1999, an agreement was entered into between the petitioner and the respondent under section 44 (1) of the Bombay Industrial Relations Act, 1946 ( the B. I. R. Act ). The respondent is a representative Union of employees engaged in the Cotton Textile Industry for the local area of Greater Bombay under the provisions of the Act. The agreement between the parties commenced with a recital to the effect that the petitioner had been facing serious financial difficulties since 1998 due to a recession in demand coupled with the unavailability of finance. On 20th December, 1999, the petitioner had issued a notice of change under section 42 (1) of the B. I. R. Act by which it had intended to discontinue the working of several department situated in the Textile Mill of the petitioner situated at Lower Parel, Mumbai. Clause 1 of the agreement provides that the petitioner shall rationalise the employment strength at the unit at Lower Parel by offering a scheme of Voluntary Retirement to the employees referred to therein. Clause 2 provides for the compensation that would be paid to employees accepting voluntary retirement and in Clause 3 it has been provided that an additional lump sum ex gratia payment of Rs. 50,000/- would be paid to each employee to tide over the initial period of unemployment. Under Clause 2 employees availing of the Voluntary Retirement Scheme (VRS ) were to be entitled to receive ex gratia payment equivalent to 38 days wages/salaries for every completed year of service in excess of six months apart from the payment of gratuity. The wages and salaries for the month of September 1999 were agreed to be paid by the sale of goods lying in the premises of the Mills, while the workmen would be paid half the normal wages for the months of October and November 1999 in full and final satisfaction of their claim (Clauses 4 and 5 ). Under Clause 8, the Voluntary Retirement Scheme was to be announced on a date to be determined by the company and was to be kept open for a period of 7 days. The petitioner reserved the right to accept or reject a request for voluntary retirement and was to determine within a period of 7 days from the closing date for the receipt of applications whether the response was adequate enough to implement the scheme. The petitioner was facing a financial crunch and accordingly a provision was made in Clause 9 to the effect that the payment of benefits to the workmen who had accepted voluntary retirement was to be made within a period of 15 months subject to the sale of the assets of the Textile Mills at Lower Parel. Provision was made for the payment of interest at the rate of 12% p. a. in the event that payment is not made of benefits payable under the scheme to the employees within the aforesaid period of 15 months. Clause 9 of the agreement provided as follows : 9. The payment of VRS benefits, gratuity, balance ex gratia payment etc. shall be made within a period of 15 months from the date of acceptance of resignation by post dated cheques drawn in favour of each workmen, subject to sale of Assets of the Lower Parel Mills. The post dated cheques as stated herein above shall be deposited in Escrow account and dealt with by the Escrow Agent in accordance with an Escrow agreement which is being executed simultaneously with this agreement by the same parties, and the terms of which shall be deemed to be a part of this agreement. If the payment of VRS as agreed above is not completed till the expiry of 15 months from the date of acceptance of resignation, the management shall pay interest @ 12% p. a. on the balance amount payable till final payment is made under the scheme. By and as a result of Clause 10 of the agreement, it was provided that upon the implementation of the scheme for Voluntary Retirement, the petitioner will operate only certain specified sections of the Textile Mill. Clause 14 provided for the abolition of posts on the employees opting for VRS.
(2.) THE dispute in the present case arises out of a complaint of unfair labour practices instituted by the respondent before the Industrial Court at Mumbai in which the respondent alleged that the petitioner had committed a breach of the agreement dated 25th December, 1999. In the complaint it was set out that pursuant to the agreement a majority of the employees accepted VRS and tendered their resignation. The petitioner paid an amount of Rs. 30,000/- to those who opted for VRS besides the payment of unpaid bonus, unpaid leave and earned wages of September, 1999. A reference was then made to a communication addressed by the petitioner stating that it was making all due efforts to sell the assets of the Textile Mills at Lower Parel and recording that in the meantime that the petitioner had been declared as a sick unit by the B. I. F. R. In a notice put up by the petitioner on 30th March, 2001, a reference was also made to the fact that the B. I. F. R. had appointed I. C. I. C. I. as an operating agency and had directed it to appoint a Sale Committee. The Sale Committee had called for tenders for the sale of the land and the process for completing the sale was expected to take 2 or 3 months. The grievance of the respondent in the complaint was that about 1600 workmen had opted for voluntary retirement on the basis of the agreement dated 25th December, 1999 but, apart from the payment of an amount of Rs. 30,000/- which was made almost 90% of the amount due under the agreement had not still been paid. Declaratory and consequential reliefs have been sought in the complaint which is pending before the Industrial Court.
(3.) THESE proceedings arise out of the prayer for interim relief which has been allowed by order dated 6th June, 2001 passed by the Industrial Court. In the prayer for interim which was made on behalf of the respondent, a direction was sought to the petitioner to pay the workmen interest computed at the rate of 12% per annum on the amounts due and payable under the scheme for voluntary retirement since the payments due and outstanding were not made within a period of 15 months as provided in Clause 9 of the agreement. By the impugned order dated 6th June, 2001, the Industrial Court has directed the petitioner to pay an amount of Rs. 10,000/- out of the unpaid amount to each of the employees.;