THE ANDHRA PRABHA LTD. & ORS versus SECRETARY, MADRAS UNION OF JOURNALISTS & ORS .

Citation: [1967] 3 S.C.R. 901 · Decided: 04-05-1967 · Supreme Court of India · Bench: K.N. WANCHOO

Cited by 3 judgment(s) · cites 1 · see the full citation network in Lexace

Judgment (excerpt)

A 
B 
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G 
H 
THE ANDHRA PRABHA LTD. & ORS .. 
v. 
SECRETARY, MADRAS UNION OF JOURNALISTS & ORS . 
. May 4, 1967 
. 
[K. N. WAN'CHOO, C.J. AND G. K. MITTER, J.J 
Industrial Disputes---Company publishing newspapers-Sale of rights 
of .publishing· nelvspapers to oth!!r companies-When a1nounts to closure. 
' 
On April 13, 1959', it was resolved by the Board of Directoni of the 
Express N_ewspapcrs (P) Ltd, that the company should sell the 
pro-
prietary rig'hts of printing and publishing its daily and weekly newspapers 
to the Indian Ex~r... (Madurai) (P) Ltd., Madurai, and to Andbra 
Prabha (P) Ltd., Vijaxawada. 
In the purchaser-companies, the chair· 
mW! of the Board of Directors ·of the vendor-company nnd members 
of his family held 4-000 out of 4200 shares. 
On April 22, 1959 there 
was an agreement between Andhra Prabha (P) Ltd. and the Express 
Newspapers whereby it was agreed that all the employees employed by 
the vendor-company in connection with the publications purchased 
by 
the pufcbaser-company would be taken into th9 service of _the purchaser-
company without any change in _their conditions of service. The workers 
of the Express Newspapers who were protesting against the sale to the 
company at Vijayawada, on the !lJ'Ound that at an earlier stage assurance 
bad been given that the publication of the papers would not be shifted 
from Madras to Vijayawada, were informed of the sale to and the agree-
ment with the company at Vijayawada. 
The).' were also informed that 
the services of those workC'rs who were not wdling to join the purchaser-
company at Vijayawada would be terminated on the usual terms as ·the 
Exp~ess Newspar.rs had no work to offer to them. 
The workers then 
gave a notice o strike and. struck work from April 27, 1959. On April 
29, 1959 the management of Express Newspapers gave 
a 
notice of 
closure and closed the company, and on the next day, tl10 Government 
of Madras referred to the Indus)rial Tribunal the two questions namely, 
( 1) whetb.-r the transfer of the publication of ·the news11aper and weekly 
to Vijayawada was justified, and (2) whether the strike and lock-out 
were 1ustified. Though the compan¥ closed its -undertaking of publishing 
!he ne)"spapers and weeklies on April 29 as it had very valuable property 
1t retained some persons, one of whom was a reporter, to look after the 
propertY, and the teleprinter service in Madras continued to be used 
till the end of October 1959 by the Madurai and Vijayawada compani~. 
The Tribunal held that there. was no evidence of the alleged assurance 
no~ to shift to Vijayawada and that the strike was unwarranted. 
The 
Trib~nal how~~er held, that the suspension of busiacss at the inception, 
that J.s on Apnl 29 was a lock out, but became a genuine closure only 
by the end of Ociober 1959. 
'" 
The workers as well as .. the Management appeaied to this Cou·rt. 
HELD : 'fhere was a ·genuine closure even on April '29 
and 
the 
~cheme of dispersal of the original undertaking "'as n·ot 11utln fide. Even 
tf there had Been no strike there "'"Otlld have been a closure . to give 
effect to the scheme and the strike only precipitated matters. [9!2C-DJ 
The nCw company which \Vas an independent legal entity could not 
be called a daughter COD]pany or benemidar of the older organisation, 
902 
SUPREME COURT REPORTS 
(1967] J S C.R 
rncrely because, there was in both companies a person or family \\:ho 
A 
could guide the destinies of the two companies. 
Further, the fact that 
there was a reporter among the persons retained to look after the pro-
perty c0uld not l·.!ad to the inference that the company did not close 
down its business but kept it going to take it u1> whenever it wanted. 
Similarly, the failure to inform the competent 
authority 
under 
the· 
Employees' Provident Filild Act of the termination of the employment 
of 700 workers was an omission, but that could not mean that 
the 
workers continued to be in the service of the company. 
With regard 
B 
to the teleprinter ser\tice, it had been paid for opto October and the 
• 
fact that the Madurai and Vijayawada companies used it till the end 
of October, 1959 would not by itself or in conjunction with other circum· 
stances of the case justify the conclusion that the company retained the 
teleprinter service for its own use. [914 B-F.l 
CIVIL APPELLATE JURISDICTION; Civil Appeals Nos. 1078 
arid 1079 of 1965 and 9 of 1966. 
C 
Appeals by special leave from the Award dated Jul

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