TaxTMI 
TaxTMI 
1996 (11) TMI 488
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....9 West Bengal Government, in exercise of its powers under Section 4(1) of the Indian Electricity Act, 1910 (hereinafter described as 'the Act'), revoked the licence of the Company and directed the Company to sell the undertaking to the West Bengal State Electricity Board (hereinafter described as 'the Board') on 16th April, 1979. Pursuant to the said order, the Deputy Chief Engineer (Commercial) took over the said undertaking on behalf of the Board on 16th April, 1979. The employees of the Company were allowed to continue in the service of the Board. 2. After an interval of about twenty days, on 5th May, 1979 the Board asked the employees to execute a form containing fresh terms and conditions of service which, according ....
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.... well as under the Board. (c) Certified Standing Order of the erstwhile Company shall remain in force so far as the petitioners are concerned. (d) Amount of gratuity shall be calculated for the petitioners who have already retired or would be retiring taking into account their entire period of service i.e. from the date of initial appointment under the Company. (e) If any of the petitioners was entitled to bonus for the period 1978-79 such bonus shall be awarded to the petitioners. (f) Retrenchment benefit shall be given to the petitioners as admissible if the petitioners are treated as retrenched. (g) The respondents shall pay the petitioners the arrears of pay and allowances after fixation of p....
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.... taking over of the undertaking and, thereafter, has been regularly paying salaries and other benefits to the employees from the date of their appointment under the Board. Neither in fact nor in law, the employees could be treated as in continuous service in spite of the change in management. 7. In our view, the contention of the Board must be upheld in the facts of this case. 8. Under Section 3 of the Indian Electricity Act, 1910, the State Government may grant licence to any person to supply energy in a specified area. Such licence can be revoked under Section 4 in publish interest in certain specified cases. Clause (c) of Sub-section (1) of Section 5 enables the State Government, after revocation of licence under Section 4, to requ....
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....ntribution to provident fund or on similar or other amount from the licensee to the employee in the affairs of the undertaking on the date of completion of the sale or on the date on which the undertaking is delivered to the intending purchaser under Sub-section (3) of Section 5 or Sub-section (6) of Section 6, as the case may be, whichever is earlier, shall be deemed to be a debt due to the employee. (2) The debt referred to in Sub-section (1) shall, on adjustment of the amount, if any, due from the employee to the licensee on the date referred to in Sub-section (1), have preference to all other debts and obligations except mortgage, and shall be payable out of the purchase price after deduction therefrom of the amount that may be....
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....y the Board is sufficiently large to pay the claims of the workmen, then the dues of the workmen should be paid out of the purchase money. It is not the case of the workmen here that money paid by the Board was not sufficient to pay the erstwhile employees of the Company. Therefore, in the facts of this case, it cannot be said that the Board has any liability to pay the workmen any amount on account of retrenchment compensation. 10. On behalf of the employees, our attention was drawn to Section 25FF of the Industrial Disputes Act, which provides: 25FF. Compensation to workmen in case of transfer of undertakings, - Where the ownership or management of an undertaking is transferred, whether by agreement or by operation of law, fro....
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....lays down that nothing in Section 25FF will apply to a workman where there has been a change of employer by reason of the transfer of the undertaking if three conditions laid down in the proviso are fulfilled. The three conditions are: (a) the service of the workman has not been interrupted by such transfer; (b) the terms and conditions of service applicable to the workman after such transfer are not in any way less favourable to the workman than those applicable to him immediately before the transfer; and (c) the new employer is, under the terms of such transfer or otherwise legally liable to pay to the workman, in the event of his retrenchment, compensation on the basis that his service has been continuous and h....