In 20-year industrial dispute, HC spares word for ‘iconic soaps’ with unique place in history

“Moti and Hamam are the iconic heritage soap brands, each holding a unique place in the country’s cultural and nostalgic history. These soap brands have left an indelible mark on almost every Indian,” he wrote

MUMBAI: Seldom in an industrial dispute does a court pause to appreciate the products made by a company at the centre of a legal battle. But when those products are as deeply embedded in the Indian way of life as Hamam and Moti, described by the Bombay High Court as “legendary and pioneering soap brands”, even a two-decade-old industrial dispute can make room for memory and nostalgia.

In 20-year industrial dispute, HC spares word for ‘iconic soaps’ with unique place in history

Delivering his verdict on petitions filed by the TOMCO Kamgar Union, representing workers earlier employed by the soap manufacturer Tata Oil Mills Company (TOMCO), against Hindustan Unilever Limited (HUL), a single-judge bench of justice Sandeep Marne opened his 40-page judgement, delivered on Tuesday, by reflecting on what the two soaps have meant to Indian households.

“Moti and Hamam are the iconic heritage soap brands, each holding a unique place in the country’s cultural and nostalgic history. These soap brands have left an indelible mark on almost every Indian,” he wrote.

With Diwali just weeks away, the court also recalled how integral Moti, the luxury soap traditionally associated with sandalwood fragrance, has been to the festival and its rituals. “Moti soap is deeply tied to Diwali, specifically the ritual of Abhyanga Snan (the holy dawn bath). For millions of Indian families, the festival does not truly begin without the distinct aroma of this soap,” Justice Marne wrote.

Launched in 1931, Hamam, a ₹300 crore herbal soap brand, had built its reputation, the court said, as “an honest, no-nonsense family soap”. “Long before the modern ‘herbal’ trend, Hamam championed the power of traditional blends of Indian ingredients,” justice Marne wrote.

The observations, however, came as the judge brought to a close a legal dispute spanning more than two decades — one that began with the closure in 2004 of the TOMCO factory in Sewree, where both Hamam and Moti were once manufactured.

TOMCO, incorporated in 1917, was merged with FMCG giant HUL in 1993-94. In 2004, the new management decided to close operations at the TOMCO factory. The dispute before the court was between HUL and the workers and their unions over an industrial tribunal’s 2008 order.

The workers had contended that the closure of the company itself was faulty in law and that the industrial tribunal had failed to take this into consideration while ordering payment of compensation to the workers in three references before it.

Their lawyers argued that HUL, which registered a profit of ₹14,300 crore before tax in the financial year ending March 2025, continued to make TOMCO products, including Hamam and Moti, but had outsourced their manufacturing.

A factory that fell silent

Justice Marne, however, said, “The workers and their unions thoroughly failed to establish that any manufacturing activities were going on at the factory at Sewree. On the other hand, there is voluminous evidence on record to suggest that there was absolutely no manufacturing activity in the factory at Sewree and the factory premises were being used essentially to store imported oil.”

The closure notice, the court noted, stated that there had been no activity at the Sewree factory for about a decade and that the building had become dilapidated and unsafe. It also stated that the company had paid ₹40 crore as idle wages for nearly 11 years and could not bleed any further. The factory, therefore, had to be shut down.

The court said the peculiar facts of the case had to be considered. By 1999, 90% of the workers at the factory had left after accepting a voluntary retirement scheme (VRS). For those who did not avail the VRS, the company continued to pay idle wages for another five years, the single-judge bench noted.

The dispute over compensation was further layered by the fact that some employees had accepted the VRS, while 85 continued to litigate.

Justice Marne, however, arrived at a figure of ₹5.67 lakh per worker as the compensation amount after taking all the claims into account. “This arrangement would ensure that there are no disputes between the parties about the exact amount payable and shall bring to an end the long dispute pending over the closure of the erstwhile TOMCO factory,” the judge said.