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Judgment
Vinod K. Sharma, J.—The Petitioners prays for issuance of writ in the nature of certiorari to quash the order dated 21.05.2009 passed by
the General Manager (PandA) Neyveli Lignite Corporation limited, seeking nomination of employees representatives to the NLC-EPF Trust
Board.
The impugned order reads as under:
Lr.No.CORP/P and A/712/2046/2009 Date:21/05/2009
To
The General Secretary
NLC Workers Progressive Union,
Neyveli.
Sir,
Sub: Nomination of employees representatives � Reg.
Ref: 1. CORP/P&A/715/1953/2002, dt.15/10/2002
CORP/P&A/715/2008, dt.04/01/2008
CORP/P&A/712/2008, dt.08/10/2008
In the reference first cited, orders were issued for reconstitution of the NLC Employees EPF Trust Board with six employee representatives
nominated by you union in your letter dated 05/10/2002 for a period of five years upto14/20/2007.
Based on your letter dated 05/01/2008, the same representatives were permitted to continue until further orders as employee representatives of
NLC EPF Trust vide orders reference third cited.
As you are aware that after the conduct of secret ballot elections on 28/02/2008, your union and NLC PattaliThozir Sangam emerged as
recognized unions. Hence it is proposed to reconstitute the NLC EPF Trust Board with 3employees representatives from your union and other
3employees representatives from NLC Pattali Thozhir Sangam.
In view of the above, it is requested to kindly inform the names of three employees representatives to be nominated from your union to the NLC
EPF Trust Board immediately
The Petitioners are the members of NLC-EPF Trust Board and are working in the various capacity with Neyveli Lignite Corporation Limited.
The Petitioners belong to NLC Wokers'' Progressive Union which was the only recognized union in the year 2002. The Petitioners were
nominated as members of Employees Provident Fund Trust.
It is the case of the Petitioners that by virtue of provisions of Section 17(1)(a) of the Employee''s provident fund scheme, 1952, Naively Lignite
Corporation Limited is under statutory obligation to form a trust, being exempted establishment under the Employees Provident Fund
(Miscellaneous Provisions) Act,1952.
The constitution of the Trust is regulated by statutory scheme called as Employees'' Provident Fund Scheme 1952. The composition of the
Board is to be as per paragraph 79-C of the scheme which reads as under:
79C. Composition of the Board of Trustees of the exempted establishments and the terms and conditions of service of the Trustees
(1) The Board of Trustees of the establishment granted exemption under clause (a) of Sub-section (2) of Section 17 of the Act shall consist of not
less than two and not more than six representatives each of the employers and employees. The number of Trustees shall be so fixed, as to afford,
as far as possible, representation to employees of each branch of department of the establishment. In the case of common provident fund for a
group of two or more establishments, there will be at least one representative each from the participating establishments:
PROVIDED that any factory or establishment seeking fresh exemption shall not be permitted to participate in any common provident fund having
more than six participating factories or establishments.
(2) The employer shall nominate his representatives on the Board of Trustees from amongst the officers employed in managerial or administrative
capacity in the establishment.
(3) The representatives of the employees, on the Board of Trustees shall be nominated or elected in the following manner, namely,
(a) wherever there is a union recognised by the employer under the Code of Discipline in industry or under any Act, such union shall nominate the
representatives of the employees;
(b) where there are more than one trade unions recognized by the employer, the representatives of employees shall be elected by the members of
the union in an election to be held for the purpose on any working day;
(c) where there is no union recognized by the employer under the Code of Discipline in industry or under any Act but there are more than one
registered unions functioning in the establishment, the union having the largest number of members, subject to a minimum of 15%membership, shall
have the right to nominate employees'' representatives; and in case there is only one registered union, it shall have the right to nominate the
employees'' representative, provided it has a minimum of 15% membership.
(4) The employer shall nominate one of his representatives on the Board to be the Chairman thereof. In the event of equality of votes, the
Chairman may exercise a casting vote.
(5) The term of office of a Trustee shall be five years from the date of election or nomination. A person representing employer or employees shall
be eligible for appointment as a member of the Board of Trustees for a maximum of not more than two terms:
PROVIDED that a member who has already completed two or more terms on the Board may continue his present term subject to the provisions
of the Scheme:
PROVIDED FURTHER that a Trustee elected or nominated to fill the casual vacancy shall hold office for the remaining period of the term of the
Trustees in whose place he is elected or nominated.
(6) A person shall be disqualified for being a Trustee if he
(a) is declared to be of unsound mind by a competent court; or
(b) has been convicted of an offence involving moral turpitude; or
(c) is an undischarged insolvent; or
(d) is an employer of an exempted or un-exempted establishment which has defaulted in payment of any dues under the Act.
(7) A person shall cease to be a Trustee of the Board if
(a) he ceases to be an employee of the establishment; or
(b) he ceases to be a member of the provident fund of the establishment; or
(c) the union on whose behalf he was elected or nominated, ceases to be recognized by the employer; or
(d) he fails to attend three consecutive meetings of the Board without obtaining leave of absence from the Chairman of the Board of Trustees. The
chairman may, however, condone the absence of a Trustee if he is satisfied that there were reasonable grounds for such absence.
(8) The procedure of election or nomination of Trustees, the quorum at the meeting of the Board, records to be kept of the transaction of business
and all other matter not specifically provided for in the Scheme shall be regulated as per the provisions of the approved Provident Fund rules of the
establishment and the guidelines for the functioning of the Board of Trustees of the exempted establishments which the Commissioner may specify,
from time to time.
(9) In case of any dispute or doubt, the matter shall be referred to the Regional Provident Fund Commissioner in whose jurisdiction the Head
Office of the establishment is located. The decision of the Commissioner in the matter shall be final and binding.
The reading of the paragraph 79(c) leaves no manner of doubt that the terms of the Office of the Trustee is for a period of five years from the date
of election or nomination. The nominated person is also eligible for reappointment subject to maximum of two terms.
The Petitioners claim that as per the terms of appointment u/s 79(c), their terms expires on 14.10.2012. It is not open to the Respondent to
change the board of trustees before expiry of statutory period of five years.
The impugned order is supported on the ground that there is bifurcation of the union. One set of the union claims to be in majority. The election
was conducted to find out the member ship strength of both the unions, in which NLC Pattali Thozhil sangam, Neyveli emerged as victorious. It is
in view of the election, that the impugned order is passed directing the majority union to nominate three persons on the Board of Trustees. The
impugned order is challenged on the ground, that the order is without jurisdiction, as under the scheme, there is no power with the General
Manager to reconstitute the Board, merely on the ground of election.
It is not the case of the Respondents that the Trustees have been ceased to are disqualified to hold the post of Trustees. The bifurcation of
union, or other union having majority is not a ground to remove trustees duly appointed under the scheme, having statutory force of law. The
impugned order therefore is without jurisdiction. Petitioners have a statutory legal right to continue as trustees of Board till 14.10.2012.
The impugned order accordingly is set aside, and the Petitioners are allowed to continue till the expiry of tenure ie 14.10.2012. However, it will
be for the Management to reconstitute the Board, in accordance with the scheme thereafter. No costs. Connected Miscellaneous petition is closed.