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1994 DIGILAW 427 (BOM)

MAHARASHTRA GENERAL KAMGAR UNION v. STATE OF MAHARASHTRA

1994-08-09

M.L.PENDSE, N.D.VYAS

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JUDGMENT : Appeal admitted. Shri Dixit on behalf of the State Government and Shri Bhatt on behalf of Respondent No. 2 waive service. By consent, appeal taken on board and called out for hearing. Heard counsel. 1. The question which falls for determination in this appeal is about the exercise of powers of review under Sub-section (5) of Section 25-O of the Industrial Disputes Act, 1947. The facts which gave rise to the dispute are not controverted and are required to be briefly set out to appreciate the grievance of the appellants. M/s. Vazir Glass Works Ltd. - respondent No. 2 is an undertaking which has a factory at Andheri, Bombay and which employed about 750 workmen. On August 14, 1992 the Company filed an application before the State Government seeking permission to close the undertaking with effect from November 16, 1992 in accordance with provisions of Section 25-O of the Act read with Rule 82-B of the Industrial Disputes (Bombay) Rules 1957. Section 25-O of the Act sets out the procedure for closing down undertaking and Sub-section (1) requires employer who intends to close down an undertaking to apply for prior permission at least 90 days before the date on which the intended closure is to become effective. The employer is required to set out the reasons for the intended closure and the copy of the application is required to be served on the representatives of the workmen. 2. Sub-section (2) of Section 25-O inter alia provides that where an application is made by the employer, the appropriate Government, after making such enquiry as it deems fit and after giving reasonable opportunity of being heard to the employer, the workmen and the persons interested in such closure may grant or refuse to grant such permission. While exercising powers, the Government has to take into consideration the genuineness and adequacy of the reasons furnished by the employer, the interests of the general public and all other relevant factors. Sub-section (3) of Section 25-O then prescribes that in case the Government fails to communicate the order granting or refusing permission sought by the employer within a period of 60 days from the date on which the application is received, then the permission shall be deemed to have been granted on the expiration of period of 60 days. Sub-section (3) of Section 25-O then prescribes that in case the Government fails to communicate the order granting or refusing permission sought by the employer within a period of 60 days from the date on which the application is received, then the permission shall be deemed to have been granted on the expiration of period of 60 days. Sub-section (4) and Sub-section (5) are required to be quoted as the dispute in appeal is centered round the effect of the provisions of these two Sub-sections :- " (4) An order of the appropriate Government granting or refusing to grant permission shall, subject to the provisions of Sub-section (5) be final and binding on all the parties and shall remain in force for one year from the date of such order. (5) The appropriate Government may, either on its own motion or on the application made by the employer or any workman, review its order granting or refusing to grant permission under Sub-section (2) or refer the matter to a Tribunal for adjudication." 3. The application seeking permission to close the undertaking filed by respondent No. 2 on August 14, 1992 was examined by the State Government in accordance with the provisions of Sub-section (2) of Section 25-O and was rejected by order dated October 12, 1992. The employer then preferred review application in accordance with provisions of Sub-section (5) of Section 25-O. The State Government, after hearing the employer and the workmen, passed order on April 7, 1994 in exercise of powers conferred by Sub-section (5) of Section 25-O read with clause (d) of Sub-section (1) of Section 10 of the Act, referring the matter for adjudication to the Industrial Tribunal. The order further recites that the Tribunal shall pass an award as provided in proviso to sub-section (5) of Section 25-O of the Act within a period of 30 days from the date of receipt of the reference. The appellants preferred writ petition No. 1446 of 1994 under Article 226 of the Constitution before the learned single Judge sitting on the Original Side of this Court to challenge the validity of the order of reference. It was claimed on behalf of the appellants that the order of reference made after lapse of one year from the earlier order dated October 12, 1992 declining permission for closure was without jurisdiction. It was claimed on behalf of the appellants that the order of reference made after lapse of one year from the earlier order dated October 12, 1992 declining permission for closure was without jurisdiction. The grave man of the complaint was that the power to review the order prescribed under Sub-section (5) can be exercised only till the expiry of one year period from the date of the original order passed under Sub-section (2) of Section 25-O. The learned single Judge summarily dismissed the petition by impugned order dated June 22, 1994 holding that the provisions of Sub-section (5) of Section 25-O are required to be read and construed liberally particularly in view of the fact that the matter is kept open before the Tribunal for examination. The order of the learned single Judge is under challenge in this appeal. 4. Shri Sawant, learned counsel appearing on behalf of the appellants, submitted that the plain reading of Sub-section (4) of Section 25-O of the Act makes it clear that the order either granting or refusing to grant permission can remain in force for one year from there date of such order. It was contended that the power of review conferred on the Government under Sub-section (5) of Section 25-O can be exercised so long as the original order passed under Sub-section (2) remains in force and once the period of one year expires from the date of the order, then the power of review under Sub-section (5) comes to end. Shri Bhatt, learned counsel appearing on behalf of respondent No. 2 on the other had urged that the power to review under Sub-section (5) can be exercised at any time provided the application for review is filed within a duration of one year from the date of the original order. It is not possible to accede to the submission urged on behalf of the employer. The plain reading of Section 25-O makes it clear that the legislature was anxious that the application for closure of undertaking should be disposed of expeditiously. The anxiety of the Legislature that the issue of closure should be decided within the stipulated period if exhibited in sub-section (2) and proviso of Sub-section (5). The plain reading of Section 25-O makes it clear that the legislature was anxious that the application for closure of undertaking should be disposed of expeditiously. The anxiety of the Legislature that the issue of closure should be decided within the stipulated period if exhibited in sub-section (2) and proviso of Sub-section (5). There is a compulsion on the State Government to decide the application within a period of 60 days from the date of the receipt and Sub-section (3) provides that the failure of the Government to take a decision either to grant or refuse would result in the grant of deemed permission in favour of the employer. The proviso under sub-section (5) prescribes that in case the Government decides to make a reference to the Tribunal, then the Tribunal shall declare the award within a period of 30 days of such reference. The combined reading of the provisions of Sub-section (2), (3), (4) and (5) makes it clear that the decision on application for closure is to be taken as early as possible closure is to be taken as early as possible because the decision rests upon the adequacy of the reasons stated by the employer and the interest of general public at the relevant time. The reasons and the interest are likely to change from time to time and therefore the anxiety that the application should be disposed of expeditiously. Once this aspect is borne in mind, then it is obvious that though sub-section (5) does not specifically provide that the review application should be disposed of within a stipulated period, the power of review cannot be exercised once the efficacy of the original order ceases in accordance with provisions of Sub-section (4) of Section 25-O of the Act. Sub-section (4) makes it crystal clear that the order of the appropriate Government granting or refusing the permission shall remain in force for one year from the date of such order and once that period is over, than power to review the order automatically comes to an end. Once the life of the order stands extinguished, then the life cannot be revived by exercising the power of review. It is not possible for the Government to inject new life in dead order, the efficacy of which has come to an end at the end of one year. Once the life of the order stands extinguished, then the life cannot be revived by exercising the power of review. It is not possible for the Government to inject new life in dead order, the efficacy of which has come to an end at the end of one year. The submission of Shri Bhatt that the order can be passed by the State Government under Sub-section (5) at any time provided the application for review is filed within one year, cannot be accepted. It is not the date of the presentation of the application but the date of the order which must be taken into consideration to examine whether the authority passing the order has jurisdiction to pass such an order. In our judgement, the Government has no authority whatsoever to review the order after expiry of one year from the date of the original order passed under Sub-section (2) of Section (2) of Section 25-O of the Act. 5. Shri Bhatt refereed to decision of a single Judge of Kerala High Court reported in 1992 LIC 1337 Laxmi Starch Ltd. & Anr. v. The Kundara Factory Workers Union and others to urge that the power of review can be exercised even after expiry of the efficacy of the order under sub-section (2) of section 25-O of the Act. The learned counsel referred to the observations in paragraph 16 of the judgment. The facts set out in the judgment are not sufficient to support the contention urged by the learned counsel. Indeed, the observations in paragraph 16 of the judgment do not support the contention of the learned counsel. Though it is undoubtedly true that the contention was raised that the order passed under sub-section (2) of section 25-O of the Act remains in force only for a duration of one year, in our judgment, the decision of the Kerala High court does not support the contention of Shri Bhatt that the Government can pass order on review application after expiry of one year from the date of the order under sub-section (2) of section 25-O of the Act. 6. Shri Bhatt and Shri Dixit then submitted that the order of reference is not only u/s 25-O(5) of the Act but is one read with Section 10(1)(d) of the Act. 6. Shri Bhatt and Shri Dixit then submitted that the order of reference is not only u/s 25-O(5) of the Act but is one read with Section 10(1)(d) of the Act. Section 10 confers power upon the State Government to refer the dispute of any matter appearing to be connected with or relevant to the dispute, whether it relates to any matter specified in the Second Schedule or the Third Schedule to a Tribunal for adjudication. Shri Bhatt submitted that the dispute in respect of closure of establishment falls within Item 10 of the Third Schedule and consequently the State Government has ample power u/s 10(1)(d) to refer the dispute to the Tribunal for adjudication. The submission cannot be faulted with but in the present case the Government has not exercised power u/s 10(1)(d) but u/s 25-O(5) and that is clear from the mere perusal of the order of reference. As mentioned hereinabove, the order sets out that the reference is made in exercise of power conferred u/s 25-O(5) and in accordance with the proviso of Sub-section (5), the Industrial Tribunal is directed to pass award within a period of 30 days from the date of receipt of the reference. In view of the specific exercise of power under Sub-section (5) of Section 25-O of the Act, it is not permissible for Respondent No. 2 to sustain the order of the State Government by reference to powers u/s 10(1)(d) of the Act. It is always open for the State Government to refer the dispute u/s 10(1)(d) of the Act for adjudication to the Tribunal but exercise of such power should have no reference to the power conferred under Sub-section (5) of Section 25-O of the Act. In our judgement, the order of reference, in these circumstances, cannot be sustained and is required to be quashed. 7. Accordingly, appeal is allowed and impugned order dated June 22, 1994 passed by learned single Judge on Writ Petition No. 1446 of 1994 passed by Industries, Energy and Labour Department, Government of Maharashtra, Bombay is quashed. In the circumstances of the case, there will be no order as to costs.