The Bombay High Court has dismissed the plea moved by the employees union of Air India against the rejection of their demand to refer the dispute to industrial tribunal.

Employees of Air India are facing eviction from their allotted accommodations and through their unions, they had raised a demand for making a reference for industrial adjudication. That demand was met with rejection by the Central Government.

The bench of Acting Chief Justice SV Gangapurwala and Justice Sandeep Marne noted that “In the present case, right to retain accommodation is governed by stipulations of leave and license agreement. There is specific remedy under the PP Act. No right is created in favour of employee to seek allotment of accommodation. in these peculiar facts and circumstances of the present case as well as for other reasons which are discussed in paragraphs to fallow, we are unable to hold that the dispute relating to housing is capable of being termed as the one connected with employment.”

The Court observed that monetization of lands and properties of Air India Limited is one of the essential terms of disinvestment process. It said that if small number of employees continue to hold on to the accommodations, the newly formed Air India Assets Holding Company Limited will not be able to monetize the land to reduce the burden of debt of AIL put on it.

The Court noted that the employees who are in occupation of accommodations would not be entirely remediless even upon rejection of their demand for a reference.

“The Estate Officer in under the PP Act would conduct eviction proceedings, before whom employees would be entitled to demonstrate their alleged right to occupy the accommodations, by placing their interpretation on Housing Rules and terms and conditions of leave and license agreements. They have further remedy before the District Judge/Principal Judge of Bombay City Civil Court to challenge the order of Estate Officer.”, the Court observed.

Senior Advocates Sanjay Singhvi and Mihir Desai appeared for petitioners whereas ASG Anil Singh appeared for Centre and Senior Advocate Kevic Setalvad appeared for Air India.

The Central Government had approved the plan for privatization of Air India. With a view to monetise the assets, all the lands and properties of AIL were vested in newly formed company Air India Assets Holding Company Limited. Thus, the lands and buildings in which the residential accommodations are situated became the property in ownership of AIAHCL. A decision was taken to permit all employees of Respondent-companies to occupy residential accommodations for a period of six months post disinvestment or till property was monetized, whichever was earlier.

Accordingly, a letter was issued by the Ministry of Civil Aviation to the AIL conveying decision taken by AISAM for vacation of accommodations allotted to the servings and retired employees.

The Court had permitted the members of the Petitioner Unions to occupy their respective allotted accommodations till September 24 2022. The Government of India was granted liberty to take a decision whether to make a reference to Industrial Tribunal. The Central Government refused to make a reference to the Industrial Tribunal. The High Court set aside the order declining reference on account of failure on the part of the Central Government to record reasons in support of its decision. The Central Government thereafter passed order once again declining to make a reference to the Central Government Industrial Tribunal inter alia holding that housing is not a term of employment and that therefore the demand cannot be considered as an industrial dispute.

Cause Title- All India Service Engineers Association v. Union of India & Ors

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Bombay High CourtActing Chief Justice S.V. GangapurwalaJustice Sandeep V Marne

Ashish Shaji