Govt to try heading off legal delays in deal

Govt to try heading off legal delays in deal
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First Published: Fri, Aug 24 2007. 01 06 AM IST
Updated: Fri, Aug 24 2007. 01 06 AM IST
New Delhi: Anticipating a last-minute legal challenge from worker unions to its decision to merge two state-owned airlines, Air India Ltd and Indian Airlines Ltd, the ministry of civil aviation is preparing to file a caveat in four high courts that no decision be taken by courts without first hearing the government’s views on the matter.
The civil aviation ministry is awaiting a formal approval to the merger of the two airlines into the newly registered National Aviation Co. of India Ltd from the ministry of corporate affairs, which has decided to clear the amalgamation after weeks of hearings involving airline representatives and union officials.
The caveat plan was precautionary, said a senior government official familiar with the process but who did not wish to be named.
“If somebody appeals against it (the order from ministry of corporate affairs), they (courts) should not pass an (stay) order on the basis of their complaint, but also give a hearing to the other party (government),” the official added. The caveat will be filed in the high courts at New Delhi, Mumbai, Chennai and Kolkata.
On Wednesday, Air India’s chairman and managing director V. Thulasidas, coming out of an hour-long merger review meeting with civil aviation minister Praful Patel, said the announcement of the merger has been postponed as the ministry of corporate affairs’ orders are yet to reach the civil aviation ministry.
“We understand that the legal process is nearly complete,” he said without going into details.
Air India and Indian Airlines have started route rationalization, switched to new branding at major airports and taking other steps to synergize operations under advice from consultant Accenture Ltd.
Together, the two airlines have a little less than 34,000 employees,?most?of?whom bear their allegiance to one airline union/association or another. Many of these workers have objected to the merger.
The Air Corporations Employees Union (ACEU), one of the largest Indian Airlines’ worker group, had gone on a flash strike in June this year resulting in over Rs3 crore loss for the airline. The two-day strike was called off after the management reached an understanding with the union over decade-long pending arrears and streamline promotions with the merging airline Air India.
On Thursday, J.B. Kadian, ACEU’s general secretary, said his worker group will wait for the legal order from the ministry of corporate affairs to see how have their objections been addressed.
The merger process is likely to take about two years in bringing two of the country’s oldest carriers together. They will function under six different business units under the mother brand of Air India, while the Indian Airlines name will be discarded.
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First Published: Fri, Aug 24 2007. 01 06 AM IST