Notice to government on Air India-Indian merger

New Delhi: The Delhi High Court Thursday asked the central government and two erstwhile national air carriers, Air India and Indian, to file their replies to the allegation in a petition that their recent merger was illegal and against the interest of the employees.
After hearing the arguments of the Cabin Crew Association of Air India, which challenged the merger, a division bench headed by Chief Justice M.K. Sarma asked the government, Air India and Indian to file their replies by Oct 30, the next date of hearing.
'The merger of Indian (Indian Airlines) and Air India stands on different footing from other mergers. These companies have been incorporated by statute and they can't be merged without amending the law,' said senior counsel Arun Jaitely appearing for the association.
'How can a joint secretary be empowered to take decision on the merger of two separate companies incorporated under law,' he argued while challenging the notification issued by the government.
Referring to the Supreme Court judgment in the case related to the merger of two state-run oil firms, HPCL and BPCL, he said companies incorporated by a statute of parliament cannot be merged without approval of the legislative body.
The legal formalities related to the merger of the two carriers were completed Aug 27 and the new entity is called National Aviation Company of India Ltd.
20/09/07 Indo-Asian News Service /Monsters and Critics.com, UK

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Categories: NACL Sep 2007