Sanctioned demerger schemes must be read by their express terms; tribunals cannot rewrite them after prolonged acquiescence.

The tribunal held that the union had notice of the sanctioned demerger scheme because public notices, annual-report disclosure, and long-standing negotiations showed awareness and acquiescence. It further construed the scheme as transferring only the staff, workmen, and employees specifically identified for the ATM and Cash Management Division, not all employees of the transferor company, because the express language confined transfer to the specified division and an expanded reading would impermissibly alter the sanctioned arrangement. A belated miscellaneous application challenging implementation was therefore barred by limitation, and the tribunal could not rewrite the clear terms of the sanctioned scheme under the guise of interpretation.

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Issues: (i) Whether the union was unaware of the sanctioned demerger scheme and had no notice of its implementation; (ii) whether the scheme required transfer of all employees of the transferor company to the transferee company or only those identified under the scheme; (iii) whether the miscellaneous application challenging the implementation of the scheme was barred by limitation and whether the tribunal could, in effect, modify the sanctioned scheme.

Issue (i): Whether the union was unaware of the sanctioned demerger scheme and had no notice of its implementation.

Analysis: Public notices and advertisements were issued when the scheme petition was heard, the scheme was disclosed in the annual report, and there were repeated meetings, correspondence, and settlements between the union and the concerned companies over several years. The record also showed that the union participated in negotiations and accepted benefits under various settlements after the scheme had been implemented.

Conclusion: The union was aware of the scheme and its implementation and could not contend otherwise.

Issue (ii): Whether the scheme required transfer of all employees of the transferor company to the transferee company or only those identified under the scheme.

Analysis: Clause 7.1 provided for transfer of only such staff, workmen, and employees of the ATM and Cash Management Division as were identified by the Board of Directors and were in service on the effective date, with continuity of service. The scheme transferred only the specified business division, while the remaining business and employees continued with the transferor company. Reading the clause to mean that all employees stood transferred would go beyond the express terms of the scheme and amount to an impermissible alteration of the sanctioned arrangement.

Conclusion: Only the identified employees covered by the scheme stood transferred, and not all employees of the transferor company.

Issue (iii): Whether the miscellaneous application challenging the implementation of the scheme was barred by limitation and whether the tribunal could, in effect, modify the sanctioned scheme.

Analysis: The miscellaneous application was filed after several years of implementation of the scheme, after the parties had acted upon it and entered into multiple settlements. The challenge was therefore belated. In addition, the tribunal could not substantially modify the terms of a sanctioned scheme under the guise of interpretation, particularly where the scheme language was clear.

Conclusion: The miscellaneous application was barred by limitation and the tribunal could not modify the sanctioned scheme.

Final Conclusion: The impugned order was set aside and the challenge to the implementation of the scheme failed, leaving the sanctioned scheme to operate according to its express terms.

Ratio Decidendi: A sanctioned scheme of arrangement must be construed according to its clear terms, and a tribunal cannot substantially rewrite it under the guise of interpretation, especially when the challenge is raised after prolonged acquiescence and implementation.

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