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Dissolution of Trade Union in India

Trade unions play a vital role in maintaining industrial harmony and protecting the interests of workers. However, there may be occasions when a trade union has to be dissolved. In India, the dissolution of trade unions is governed by various statutes and legal principles.


Statutory Provisions Governing Dissolution

Trade Unions Act, 1926

Under Section 27 of the Trade Unions Act, 1926, a trade union may be dissolved in accordance with the rules of the union.


Requirements under Section 27:

  • Minimum support of more than half of the total number of members.

  • Compliance with the rules for dissolution, as mentioned in the union's by-laws.

  • A notice of dissolution must be sent to the Registrar within 14 days, accompanied by a report of the final audit.


Processes and Procedures for Dissolution

1. Calling a Special Meeting:

  • Notify all members of the intention to discuss dissolution.

  • Agenda, date, and time must be specified.

2. Passing a Resolution:

  • A resolution must be passed with the support of over half of the total members.

3. Final Audit and Notice to the Registrar:

  • The assets and liabilities must be audited.

  • Submit the audit report along with the notice to the Registrar.


Rights of Members on Dissolution

Members are entitled to various rights upon dissolution, such as:

  • Receiving their proportionate share of the funds, as prescribed in the rules.

  • Participating in the decision-making process.


Case Laws Related to Dissolution of Trade Union

  1. Kamani Employees Union v. Kamani Tubes Ltd.: This case emphasized the importance of complying with the statutory requirements for dissolution.

  2. Workmen of M/s Firestone Tyre & Rubber Co. v. The Management: In this case, the Supreme Court outlined the principles regarding the rights of the members in the event of dissolution.


Consequences of Dissolution

  • Loss of registration and legal entity status.

  • Distribution of assets among members as per rules.

  • Termination of pending legal proceedings.


Conclusion: Navigating the Complexities of Trade Union Dissolution

Dissolution of a trade union in India is not a mere administrative procedure; it involves complex legal obligations. It necessitates compliance with statutory regulations, adherence to the rules of the union, and a proper understanding of the rights and responsibilities of all parties involved. The dissolution process must be approached with caution and legal acumen, as it has significant ramifications on the industrial relations landscape and the individual rights of members. The guidance of legal principles, relevant statutes, and case laws ensures a fair and lawful dissolution process.


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