BOMBAY GAS PUBLIC LTD. v. BOMBAY GAS COMPANY EMPLOYEES UNION
2000-04-07
N.J.PANDYA, RANJANA DESAI
body2000
DigiLaw.ai
JUDGMENT : Ranjana Desai, J. - By this petition, the petitioners have challenged the constitutional validity of Sections 25-O and 25-R of the Maharashtra Act No. 3 of 1982. The petitioners also seek setting aside of the impugned order dated March 13, 1987 passed by the Industrial Tribunal Maharashtra and restoration of the order dated November 23, 1983, passed by Shri N.G. Kimmatkar, the then Minister of State for Labour, Government of Maharashtra. Alternatively it is prayed that it be declared that the permission for closure of the Coal Glass plant at Lalbaug, applied for by petitioner No. 1 the Bombay Gas Public Limited Company shall be deemed to have been granted with effect from November 16, 1983. Other consequential reliefs are also sought. The challenge to the constitutional validity of Sections 25-O & 25-R was not pressed and hence we need not address ourselves to it. 2. We may begin with the facts - Petitioner No. 1 is a public limited company which used to carry on the business of production and distribution of coal gas at its Lalbaug factory prior to July 1981. The 1st petitioner is also referred to as the company at some places for the sake of convenience and clarity. Petitioner No. 2 is the shareholder and the Vice President and General Manager of petitioner No. 1. Respondent Nos. 1 and 9 are two independent unions which claim to represent some of the former workers of petitioner No. 1. The second respondent is the General Secretary of Bombay Gas Co. Staff Association. The Staff Association has entered into a settlement with petitioner No. 1 dated April 29, 1985, on behalf of the workmen employed by petitioner No. 1, who have accepted the terms of the said settlement. The third respondent is a workman of the 1st petitioner who is one of the five elected representatives of the workmen who have entered into a settlement with petitioner No. 1 on May 23, 1985 on behalf of himself and Meter Readers and Assistant Meter Readers of the 1st petitioner. The fourth respondent is a workman of the 1st petitioner who was a member of the negotiating committee which brought about the settlement dated June 11, 1985 between the company and its workmen. Respondent Nos. 3 and 4 are also members of the staff association.
The fourth respondent is a workman of the 1st petitioner who was a member of the negotiating committee which brought about the settlement dated June 11, 1985 between the company and its workmen. Respondent Nos. 3 and 4 are also members of the staff association. Respondents No. 7 and 8 are former workmen of petitioner No. 1 who are impleaded in the petition on behalf of themselves and all other workmen who have not accepted the settlements. 3. On September 17, 1983, petitioner No. 1 served 60 days' notice on the Government of Maharashtra intimating its intention to close down its undertaking at Lalbaug in terms of Section 25-FFA of the Industrial Disputes Act, 1976 (for short 'the said Act'). On the same day i.e. on September 17, 1983, petitioner No. 1 also made an application to the Government of Maharashtra for permission to close down its undertaking in the prescribed form by way of abundant caution and without prejudice to its contention that Section 25-O of the said Act was void and petitioner No. 1 was not obliged to seek permission before closing down its undertaking. The requisite notices were served on all the workmen. Petitioner No. 1 notified to the Government of Maharashtra that it intended to close down its Gas manufacturing works and its department at Lalbaug with effect from December 26, 1983. 4. In the said application it was stated that 915 workmen were likely to be affected by the said closure and the petitioner No. 1 shall pay the compensation to the workmen as provided u/s 25-N of the said Act. The figures of losses already suffered by it were set out. It was stated that paid up capital of Rs. 40 lakhs was wiped out by the losses suffered by it. The said undertaking was not functioning and was factually closed since July 29, 1981. The decision to close down was bona fide. The reasons for closure were set out in the annexure to the said application. The said application ought to have been decided by the Minister of State for Labour within 60 days from its receipt i.e. by November 16, 1983. The Government of Maharashtra however, represented to petitioner No. 1 that the Minister had no time to pass order by November 16, 1983 but it would be passed very shortly. Petitioner No. 1 was asked to give a letter extending time.
The Government of Maharashtra however, represented to petitioner No. 1 that the Minister had no time to pass order by November 16, 1983 but it would be passed very shortly. Petitioner No. 1 was asked to give a letter extending time. Petitioner No. 2, therefore, addressed a letter to the Minister of State for Labour on November 16, 1983, to that effect. 5. The Minister of State for Labour by his order dated November 23, 1983, granted the application for closure. Petitioner No. 1 was permitted to close down the said undertaking, subject to the condition that if it is entrusted with the work of distribution of off-shore gas (Bombay High Gas) through its network and needs workmen both skilled and unskilled, the workmen who will be affected by the permission to close down the coal gas plant at Lalbaug will be given priority and preference by the management in the matter of recruitment in that work. 6. Being aggrieved by the said order, Respondent Nos. 1 and 9 filed appeals No. 6 and 7 of 1983 respectively before the Appellate Industrial Tribunal. By judgment and order dated April 6, 1984, the appellate authority set aside the order dated November 23, 1983 passed by the Minister on the ground that the Government had become functus officio after the expiry of the stipulated period of 60 days and the said order could not be passed on November 23, 1983, as the last date on which the said order could be passed was November 16, 1983. It was held that the first petitioner was not entitled to take advantage of the deeming provision in terms of Sub-section (3) of Section 25-O of the said Act and the only course open to petitioner No. 1 was to make a fresh application for permission to close down the said undertaking, if so desired. 7. Being aggrieved by the said order dated April 6, 1984, the petitioner filed writ petition No. 1215 of 1984, in this Court: By judgment and order dated January 21, 1986, this Court held that the order passed by the Industrial Tribunal was not correct, as it had given contradictory findings while holding that the Government, had become functus officio on expiry of 60 days and also holding that the 1st petitioner should not take advantage of the deeming provisions.
This Court remanded the said appeals for reconsideration of the matter on merits including scrutinising the effect of deeming provision after the appeals were amended to include the said challenge. The necessary interim directions were passed to protect both sides. 8. Pursuant to this order respondents No. 1 and 9 amended their appeals to which replies were filed on behalf of petitioner No. 1. A number of documents came to be filed by petitioner No. 1. Petitioner No. 1 examined petitioner No. 2 and one Mithileshkumar Sinha as its witnesses. Respondents did not examine any one. The Industrial Tribunal allowed the said appeals. By its judgment and order dated March 13, 1987, it set aside the order dated November 23, 1983 passed by the Minister granting the petitioner permission to close down its undertaking at Lalbaug. The said order is impugned in the present petition. In short the challenge is to the closure. 9. We have heard at some length Mr. Cama, the learned counsel appearing for the petitioners, Mr. C.U. Singh with Ms. Naina Buch and Mr. Ganguli for the respondents. We have been taken through the relevant pleadings and documents. 10. Drawing our attention to Article 254 of the Constitution of India Mr. Cama urged that Section 25-O(2) was added in the said Act, by the Maharashtra Act No. 3 of 1982. The Central amendment to Section 25-O was made and became law on its gazetting i.e. on September 1, 1982. Section 25-O(2) as added by the Maharashtra Act No. 3 of 1982 had a wider ambit. By Central amendment the scope of Section 25-O(2) was made much narrower. Whereas by the State amendment an order of the appropriate Government granting permission under Sub-section (4) was made appealable, under the Central amendment no appeal is provided and order of the appropriate Government granting or refusing to grant permission is, subject to provisions of Sub-section (5) final and binding on all the parties and is to remain in force for one year from the date of such order. Under Sub-section 5 of the Central amendment appropriate Government can review its order granting or refusing to grant permission or refer it to Tribunal for adjudication.
Under Sub-section 5 of the Central amendment appropriate Government can review its order granting or refusing to grant permission or refer it to Tribunal for adjudication. Whereas under Sub-section (9) of the State amendment in case where permission of closure is granted or deemed to have been granted, the worker is entitled to notice and compensation as specified in Section 25-A of the said Act as if the workmen had been retrenched. Under Sub-section (8) of the Central amendment workman is entitled to fifteen days' average pay for every completed year of continuous service or any part thereof in excess of six months. Mr. Cama urged that there is therefore, enough indication of repugnancy and the Central Act expressly intends to cover the entire field and therefore, the Central Act will prevail over the State Act which to the extent of repugnancy would be void, Mr. Singh on the other hand contended that the central law commenced on August 21, 1984 and hence the repugnancy argument assuming it to be valid will not further the petitioner's case because it is the date of commencement which is material. The application for closure was made on September 17, 1983, that, is before the commencement of the Central law. 11. Mr. Cama contended that in any event on the date of remand by the High Court on January 21, 1986, the Appellate Tribunal had ceased to exist and hence the Tribunal could not have decided the appeals. In support of his submissions Mr. Cama relied upon the judgments of the Supreme Court in Pt. Rishikesh and Another Vs. Salma Begum (Smt), and Thirumuruga Kirupananda Variyarthavathiru Sundara Swamigalme Vs. State of Tamil Nadu and Others,. While Mr. Singh relied on Krishna District Co-operative Marketing Society Limited, Vijayawada Vs. N.V. Purnachandra Rao and Others,. Though arguable, in the view that we are taking, it is not necessary for us to go into this aspect of the matter. We, therefore, express no opinion on this aspect. 12. Before we deal with the submission of both sides it is necessary to see what is the law on the point. u/s 25-O of the said Act, if a company wishes to close its establishment, it has to satisfy the appropriate Government that the reasons given by it for closure are genuine and adequate.
12. Before we deal with the submission of both sides it is necessary to see what is the law on the point. u/s 25-O of the said Act, if a company wishes to close its establishment, it has to satisfy the appropriate Government that the reasons given by it for closure are genuine and adequate. The appropriate Government, while considering the genuineness and adequacy of the reasons, must also consider public interest and other relevant factors before granting the permission. In Excel Wear and Others Vs. Union of India (UOI) and Others, , the Supreme Court has, while dealing with the constitutional validity of Sections 25-O and 25-R of the said Act, observed that, the right to close a business is an integral part of the fundamental right to carry on business. But it can certainly be restricted, regulated or controlled by law in the interest of general public. It observed that the law may provide to deter reckless, unfair, unjust or mala fide closure. But not to permit the employer to close down is essentially an interference with the fundamental right to carry on the business. 13. Our attention is also drawn by Mr. Cama to the judgment of the Gujarat High Court in Associated Cement Companies Ltd. and Another Vs. Union of India and Others, . After referring to the judgment in Excel Wear (supra), the Gujarat High Court observed that the right to close down a business being an integral part of the fundamental right to carry on business, words "genuine" and "adequate" must have that meaning which is consistent with the nature of that right. If the closure is bona fide or on account of unavoidable circumstances beyond the control of the employer then, the reasons will have to be regarded as genuine and adequate. The High Court noted that a situation may arise both from the point of view of law and order and from the financial aspect that the employer finds it impossible to carry on business any longer, such a reason has to be regarded as adequate. 14. The Gujarat High Court stressed the need to strike a balance between the right of the employer and other relevant factors including interest of general public. Permission for closure cannot be refused on the ground that the employer should have managed the affairs in a better manner.
14. The Gujarat High Court stressed the need to strike a balance between the right of the employer and other relevant factors including interest of general public. Permission for closure cannot be refused on the ground that the employer should have managed the affairs in a better manner. Public interest and social justice do require protection of labour, but interest of other members of the public are also required to be considered. 15. We are in agreement with the view expressed by the Gujarat High Court based as it is on the judgment of the Supreme Court in Excel Wear's case (supra). We will, therefore, ascertain whether the reasons for closure are adequate and genuine. We will also have to consider whether the interests of general public are affected or not and other relevant factors. 16. Mr. Cama made a scathing attack on the manner in which the Tribunal has dismissed the first and the prime reason for closing the company i.e., non-availability of municipal permit and storage licences. This point is inter-linked with the aspect of pollution which was admittedly caused by the company. Drawing our attention to various newspaper cuttings and correspondence Mr. Cama contended that the pollution caused by the company was admittedly a matter of concern and became a subject of correspondence between the company on the one hand and the Corporation and the Government on the other hand. The licence was revoked on the ground that the company had not taken steps to check pollution. The Tribunal has accepted this without looking into the relevant material which the company placed on record. He contended that the Tribunal has completely ignored the material which indicates the steps taken by the company to abate pollution. It shows that the company had, intimated the efforts made by it to the Corporation and the Government and tried to persuade the Corporation to grant licence and permit. Mr. Cama further contended that the correspondence shows that the Corporation had adopted a very rigid and negative approach and in fact when the company had called upon the Corporation to indicate whether in the new natural gas regime the company had any long term guaranty or security, the Corporation had refused to give any assurance. The Corporation on the contrary indicated that it had taken a decision to municipalise the company.
The Corporation on the contrary indicated that it had taken a decision to municipalise the company. The learned counsel further argued that it was difficult for the company to undertake more measures to abate pollution and spend enormous amount for the same when the Corporation had refused to give any assurance to the company regarding its future. We find that the Tribunal has overlooked the voluminous documents which the company had filed in the Court. We will, therefore, make a reference to some of them. Normally we would not have made such a detailed reference to correspondence, but since some observations made by the High Court are sought to be relied upon by the respondents to contend that the High Court had considered these documents and passed certain remarks against the petitioners, we deem it necessary to do so. At the appropriate stage we shall advert to the High Court's orders and the circumstances under which they were made. 17. We are of course, not oblivious of the fact that in writ jurisdiction, such an in-depth examination of material is not generally permissible. In fact our attention is drawn by Mr. Singh to the judgment of the Madhya Pradesh High Court in Straw Products Ltd. Vs. Union of India (UOI) and Others, where the Court has outlined the scope of writ jurisdiction in case of refusal of permission for closure. The relevant observations on which Mr. Singh has laid stress are as under at P. 477: "16. Where the reasons given by the State Government for refusing permission for retrenchment of workmen u/s 25-N and/or closure bf an industrial undertaking u/s 25-O of Act (14 of 1947) was that the petitioner company had failed to show adequate reasons for grant of such permission, and the other reasons given by the State Government were also found to be not extraneous or irrelevant, order refusing permission could not be interfered with in exercise of writ jurisdiction. The scope of inquiry in a writ petition is limited to seeing whether the ultimate opinion formed by the State Government is vitiated on account of ignoring any relevant factors or taking into account irrelevant, extraneous or non existent factors so as to disclose an error apparent on the face of the record.
The scope of inquiry in a writ petition is limited to seeing whether the ultimate opinion formed by the State Government is vitiated on account of ignoring any relevant factors or taking into account irrelevant, extraneous or non existent factors so as to disclose an error apparent on the face of the record. In writ jurisdiction Court cannot examine the correctness of the conclusion relating to adequacy of the reasons unless the finding thereon is vitiated by an error apparent on the face of the record." 18. We are in agreement with this view. In the facts of the case on hand, we are of the view that the opinion formed by the Tribunal is vitiated on account of ignoring relevant factors. Certain extraneous factors have weighed with the Tribunal. There is intrinsic evidence of non-application and there is error apparent on the face of record. We will therefore, deal with the correspondence in detail. 19. The show cause notice issued to the company u/s 479 (3) of the Bombay Municipal Corporation Act is dated November 15, 1977. Immediately thereafter i.e., on November 23, 1977, the company addressed a letter to the Dy. Municipal Commissioner setting out therein the measures adopted by it to minimise emission of particular matter, smoke, fumes, etc. The company requested that the notice be withdrawn and permit be renewed. The company also sought a personal interview with the Municipal Commissioner. The company sent a further letter dated February 22, 1978 to the Corporation. There is a reference to the interview which the representatives of the company had with the Municipal Commissioner on February 2, 1978 regarding the expeditious renewal of the municipal permit. As discussed in the meeting, the anti-pollution measures adopted by the company were intimated to the Corporation. By further letter dated March 1, 1978 the company intimated to the Municipal Commissioner further measures adopted by it. By a fetter dated April 14, 1978 running into almost 3 pages, the company again set out the efforts made by it to minimise pollution and the difficulties experienced by it while adopting the measures. The company requested that the Corporation should rescind the revocation of the permit. Letter dated April 19, 1978 makes a reference to the interview granted to the company's spokesman on April 15, 1978 by the Municipal Commissioner.
The company requested that the Corporation should rescind the revocation of the permit. Letter dated April 19, 1978 makes a reference to the interview granted to the company's spokesman on April 15, 1978 by the Municipal Commissioner. It appears that different measures adopted by the company to abate smoke/dust nuisance were made known to the Corporation but the Municipal officials stressed the need to abate smoke/dust nuisance due to suspended particulate matter. It appears from the letter that the company had taken a decision to refer this problem to Tata Consultancy Engineers for immediate study and report. Through this letter assurance was given to the Municipal Commissioner that report would be obtained. This letter also shows that during the interview the company suggested certain long term and effective measures for solving the problem of pollution occurred largely on account of the use of horizontal retorts for carbonisation. It also makes a reference to the fact that to solve the problem the company preferred installation of vertical retorts with coal supplies from Madhya Pradesh and Maharashtra Coal Fields. The estimated cost was Rs. 40 lacs for installing external producers for the abatement of chimney emission. The letter states that more than a crore of rupees were necessary for immediate measures. The company conveyed to the Municipal Commissioner that it was willing to undertake the investment of this order in case the Corporation removes the uncertainties governing the future ownership. It appears from further correspondence that Tata Consultancy did not submit its report and ultimately expressed its inability to take up the work on account of heavy work-load. The company ultimately requested the Deputy City Engineer by its letter dated June 2, 1978 to fix the design parameters for the equipment under consideration for dealing with the pollution due to particulate matter at the roof level of the carbonising plant. The Corporation was requested to indicate the permissible limit for the concentration of the particulate matter. By letter dated June 14, 1978, the Corporation expressed its inability to undertake the testing work and directed the company to get this work done through some other consultant. The correspondence shows that the work was assigned by the company to S.F. India Ltd. This is evident from the letter dated July 25, 1978 sent by the company to the Corporation.
The correspondence shows that the work was assigned by the company to S.F. India Ltd. This is evident from the letter dated July 25, 1978 sent by the company to the Corporation. The company also addressed letter to the Mayor of Bombay on June 13, 1978 setting out in detail the steps taken by it and requesting the Mayor to persuade the Corporation to grant it permit. The company requested that uncertainties about its future be removed and proposal submitted by it as far back as in 1974 regarding installation of vertical reactors be considered. The relevant paragraph of the said letter reads thus: "The company has drawn the attention of State Government and Municipal Authorities that while all these measures might cause reduction of pollution, the only correct steps will be to go in for modernisation of carbonising plant by substituting the horizontal retorts with vertical retorts, which would comply fully with all stringent regulations regarding air pollution. The company has submitted detailed proposals to the State Government as far back as 1974 incorporating the suggestions regarding the installation of vertical retorts. The company is regularly reminding them for consideration. The company sought the good offices of the Honourable Mayor to get the issue resolved and secure permission for such installation so that the problem of pollution could be solved once and for all. The company's representatives further emphasized that once the uncertainties about the future ownership of this company and coal carbonisation process as such are cleared, the company would strictly abide by a programme of phased conversion of horizontal retorts by vertical retorts in a specified period." In this letter there is a reference to a meeting in which a statement was made by Shri Shirodkhar of the Corporation that the Corporation had already passed a resolution regarding municipalise of the company and that it was not open to the authorities to discuss the procedures outside the ambit of the resolution. 20. By letter dated August 17, 1978 the Mayor of Bombay informed the petitioner that, the Corporation had passed a resolution to municipalise the Bombay Gas Company Ltd. The Corporation was proposing to acquire the sole right to distribute the natural gas available and in view of this, the company's proposal for expansion and modernisation cannot be considered.
20. By letter dated August 17, 1978 the Mayor of Bombay informed the petitioner that, the Corporation had passed a resolution to municipalise the Bombay Gas Company Ltd. The Corporation was proposing to acquire the sole right to distribute the natural gas available and in view of this, the company's proposal for expansion and modernisation cannot be considered. It was stated that till such time as the company is continued to operate anti-pollution measures should be adopted by it. This letter clearly indicated that the company's future was uncertain. By further letter dated September 2, 1978 addressed to the Commissioner of Labour, Bombay, the company again communicated the anti-pollution measures taken by it. It was intimated that despite requests, the Corporation had not undertaken air quality tests. It was stated that with a view to solving the problem of pollution once and for all, the company had submitted proposals to the State for the installation of Proto Type vertical retorts to be followed by the phased conversion of the existing horizontal retorts to vertical retorts and the Government's response was awaited. Because S.F. India by its letter dated September 19, 1978 communicated to the company its inability to carry out the testing in September, 1978, the company by its letter dated September 13, 1978 informed the Municipal Commissioner that the time for submission of proposal be extended. By letter dated October 12, 1978, the company was informed by the Government that the Government would substitute completely the coal gas by off-shore gas to abate the air pollution in Lalbaug and surrounding area. By letter dated October 18, 1978 the same fact was reiterated thus making the company's future totally uncertain. By letter dated January 16, 1979 the company again conveyed to the Corporation the compliance of anti- air pollution measures suggested by it and the Smoke Nuisance Commission. By letter dated July 12, 1980 the Corporation rejected the request of the Company to renew its permit. The Company again sent a letter on August 30, 1980 requesting the Corporation to renew its permit and licence. It was stated that the company had plans to modernise the existing carbonisation unit by installing vertical retorts.
By letter dated July 12, 1980 the Corporation rejected the request of the Company to renew its permit. The Company again sent a letter on August 30, 1980 requesting the Corporation to renew its permit and licence. It was stated that the company had plans to modernise the existing carbonisation unit by installing vertical retorts. The company also addressed letter dated December 2, 1980 and April 18, 1981 to the Minister for Urban Development and letter dated April 21, 1981 to the Minister of Industries setting out the measures taken by it and making a request that the company's permit and licences be renewed. A detailed letter was also addressed to the Secretary, Urban Development Department, Government of Maharashtra on March 31, 1981. Again by a detailed letter dated July 16, 1981 the Mayor was requested to renew the permit and licence. A further letter dated August 18, 1981 was sent to the Municipal Commissioner making the same request and conveying that the company had installed a modern gasification plant with all built-in anti-pollution devices at a cost of Rs. 50 lacs, but the Corporation had not carried out air quality test. Minutes of meeting dated September 5, 1981 indicates that the company had meeting with the concerned Ministers and top officers of the State and the Corporation in which, the company had put up its proposal. The minutes indicate that the Deputy City Engineer, B.M.C, had reviewed the possibility of taking any interim measures for reducing the present pollution standard. He felt that there was no scope left for any further reduction in the present pollution. The Deputy City Engineer had noted that the Bombay Gas Company has been made aware of these hazards since 1976 and they have not been able to take any anti-pollution measures so far because for this type of pollution, it is not possible to do much. Therefore, it is clear that the pollution was of a type which could not have been easily controlled by the company. That explains why despite efforts made by it the company could not achieve much results. 21. Besides, there appears to be total non-cooperation from the Government and the Corporation.
Therefore, it is clear that the pollution was of a type which could not have been easily controlled by the company. That explains why despite efforts made by it the company could not achieve much results. 21. Besides, there appears to be total non-cooperation from the Government and the Corporation. On September 29, 1981 a letter was addressed to the Minister for Urban Development stating that the company was passing through a labour crisis because, in the meantime, the workmen of the company had gone on an illegal strike. The Minister was informed that after normalcy is restored, pollution control would be undertaken. On September 16, 1981, the Government gave no objection to the Corporation to take legal action against the company. Another letter was addressed to the Secretary, Urban Development on November 23, 1981 informing him that the workmen of the company had resorted to an illegal strike since July, 1981. The 1st Labour Court had declared the strike illegal on August 24, 1981. The strike was continuing till date and consequently the contemplated anti-pollution measures could not be undertaken as the contractors were afraid to undertake the work in the factory premises. The company was deeply committed to abatement of pollution to the minimum. The operations of the company were at a standstill. The moment strike is over and normalcy is restored, the work would be completed. Further letter was sent to the Secretary on November 21, 1981 to the same effect. Yet another letter was forwarded to the Minister of Urban Development, Government of Maharashtra on July 5, 1982 requesting the Minister to advise the Corporation to renew the Company's municipal permit. It was intimated that number of workmen had approached the company for resuming operation. The gas plant had suffered considerable damage due to strike. Resumption of operation would involve heavy investment. A possible switch over to distribution of Bombay High Gas through pipeline network was also indicated. The heavy capital investment for taking anti- pollution measures for a short period would, therefore, not be justified. In any case it was stated that solely with a view to providing employment to its workmen, the company intended to resume operations and hence the Corporation should renew the licences for interim period. Similar request was made by letters dated August 3, 1982 and November 23, 1982.
In any case it was stated that solely with a view to providing employment to its workmen, the company intended to resume operations and hence the Corporation should renew the licences for interim period. Similar request was made by letters dated August 3, 1982 and November 23, 1982. By letter dated December 15, 1982 the Municipal Commissioner made it clear that the Corporation had already passed resolution not to renew the permit and licences of the company as it had not taken measures for abatement of pollution. 22. A letter was addressed to the Mayor of Bombay dated December 20, 1982 stating that the Company on its own had taken a number of steps to abate the Smoke Nuisance and tried to comply, as far as practicable with measures suggested by the Corporation and Smoke Nuisance Commission. It was informed that the request was already made to extend the time on account of the on-going illegal strike and since number of workmen were desirous of resuming work, the company's municipal permit and storage licences be renewed. Yet another letter was addressed to the Dy. Chief Minister, Government of Maharashtra. He was informed that the company's plant and machinery had suffered extensive damage due to the prolonged strike. Restarting the manufacturing operations calls for heavy financial liability of about a crore of rupees. The company's bankers were not ready to extend facility in absence of a valid municipal permit. The company is facing a serious dilemma. By restarting the company without municipal permit and storage licences, the company will be committing breach of the provisions of the Municipal Act for which, the company was liable for prosecution under the Municipal Act. On the other hand failure to commence operations would involve contempt of Court for which, criminal complaint can be filed against the company. The Minister was requested to consider the grant of permit and storage licences for a limited period to ensure good labour relations and avoidance of supply to the gas consumer. A meeting was held on April 26, 1983 in which the representative of the company was present. He clarified that the factory had been closed since July 1981 due to labour strike and that the company was very keen on restarting the factory early. It was urged that the renewal of licence may be done without which restarting of the company was not possible.
He clarified that the factory had been closed since July 1981 due to labour strike and that the company was very keen on restarting the factory early. It was urged that the renewal of licence may be done without which restarting of the company was not possible. After restarting the factory, the company will take anti-air pollution measures immediately. The company was asked to submit a proposal. The company submitted a memorandum detailing the steps taken by it to abate smoke nuisance. Another letter dated June 4, 1983 was addressed to the Commissioner requesting renewal of permit for carrying out carbonization process for a limited period in the interest of the consumers and the workers. It was stated that the company wanted to install for the entire length of the jack roof opening special static mechanical filters made of woven steel mesh fitted on the outer side with natural and synthetic fibre tufts besides cowls on the top of the jack roof. The lengthy correspondence bore no fruits. The company's licence was not renewed. 23. This correspondence persuades us to hold that the company did make efforts to get the permit and licences renewed. It tried to comply with the requirements of anti-pollution measures, but number of difficulties seem to have been created in its way. Its future was -uncertain and that was intimated to it by the Corporation in no uncertain terms. The Corporation's approach was not encouraging. It did not even carry out the air quality test though repeatedly requested. The illegal strike also dealt a severe blow to the company's efforts. Therefore, we are unable to conclude as was done by the Tribunal that there was no desire on the part of the company to restart the factory or that the company did not try to fulfil the anti-pollution requirements. The municipal permit and storage, licences were made dependent on anti-pollution measures. The company did take some anti-pollution measures. But as admitted by the Deputy City Engineer, the air pollution was of a type about which nothing much could have been done. Secondly, the company was so uncertain about its future that it did not know whether to incur more expenses on anti- pollution measures. The decision to municipalise it had already been taken. The Tata Consultancy had also no time to give its assistance to carry out air quality test.
Secondly, the company was so uncertain about its future that it did not know whether to incur more expenses on anti- pollution measures. The decision to municipalise it had already been taken. The Tata Consultancy had also no time to give its assistance to carry out air quality test. S.F. Limited also did not do its work on time. In spite of repeated requests, the Corporation did not carry out the air quality test. The illegal strike made the situation worse. Admittedly, the machinery was idle for a long time which resulted in damage being caused to it which we shall advert a little later. Restarting such a machinery would involve more expenses. In our opinion, the company was placed in a very unhappy and difficult situation. 24. We may now turn to the High Court's orders. On July 29, 1981 the workers went on strike. On August 24, 1981, the strike was declared illegal and on April 1, 1982, its continuance was prohibited by the State Government. On September 11, 1982, the union informed that 300 workmen wanted to resume work. On September 14, 1982, the union filed a proceedings u/s 25 of the M.R.T.U. & P.U.L.P. Act for a declaration that the company had declared a lock out and it was illegal. (U.L.P. 101 of 1982). On September 17, 1982, 1st Respondent filed a complaint of unfair labour practice alleging that the company was continuing a lockout which is illegal. In this complaint on October 5, 1982, an interim order was passed directing the company to allow its workmen to report to duty from January 15, 1983. 25. On November 2 & 23, 1982, the company sought renewal of its permission to run the gas work. On December 15, 1982, the Corporation refused permission on the ground of pollution. The company preferred a review application against the order dated October 5, 1982 and requested extension of time to allow workmen to report to duty on December 31, 1982. On January 13, 1983, it was extended till February 14, 1982, and on February 14, 1983, it was extended upto June 15, 1983. Another extension was granted on June 29, 1983, upto July 8, 1983. 26. Writ Petition No. 1113 of 1983, came to be filed by the Union challenging extension granted by the Industrial Court. On April 26, 1983, it was rejected by the High Court.
Another extension was granted on June 29, 1983, upto July 8, 1983. 26. Writ Petition No. 1113 of 1983, came to be filed by the Union challenging extension granted by the Industrial Court. On April 26, 1983, it was rejected by the High Court. The High Court observed that the company had done little or nothing to comply with the order dated October 5, 1982 directing the company to allow its workmen to resume work or its second extension. The Industrial Court should be careful to see that concrete steps have been taken to comply with this order when such an application is made. The High Court further observed that the steps should be regarding the repair of the plant as distinct from its survey and regarding obtaining of the municipal licence other than mere correspondence. The petition was rejected by observing that as regards the extension already granted there was no need to intervene. 27. The company filed Writ Petition No. 1664 of 1983. This writ petition challenged the order dated October 5, 1982 passed by the Industrial Court directing the company to allow its workmen to report to duty. The High Court rejected this writ petition on July 7, 1983. The High Court refused to entertain it on the ground that the company wanted to delay resumption of work by its workmen. When it was informed that the company had filed a writ petition against the Corporation, the High Court observed that the writ petition came to be filed by the company only when it seemed to the company that it would get no extension. The High Court further observed that the impugned order dated October 5, 1982, was passed at an interim stage and, therefore; a direction was given to the Industrial Court to dispose of the said complaint expeditiously. 28. Writ Petition No. 1533 of 1983, came to be filed by the company against the Corporation for a direction to the Corporation to grant permit. The said petition was opposed by the workmen. On July 18, 1983, minutes of the order came to be filed. By the said order, the company was permitted to work the factory for four months from the date of the commencement of the factory on an experimental basis to find out whether the pollution is within permissible limits.
The said petition was opposed by the workmen. On July 18, 1983, minutes of the order came to be filed. By the said order, the company was permitted to work the factory for four months from the date of the commencement of the factory on an experimental basis to find out whether the pollution is within permissible limits. The order further made it clear that if at the end of four months, it is found on the basis of the reports of the officers that pollution is beyond the tolerable limits, the petitioner will cease to work the factory. If the Commissioner is satisfied that pollution is within permissible limits; he will grant the permit. The arrangement was to come to an end if the factory does not commence work on or before August 22, 1983. 29. On August 20, 1983, the company filed affidavit that it will not be possible for the petitioners to start slow-firing furnace. The High Court, therefore, directed that the arrangement under the order of July 18, 1983, was to come to an end forthwith. The petition was directed to be placed for admission on August 22, 1983. While doing this, the High Court observed that this was not what was contemplated by anybody including the petitioner when the order was passed and the sentence in the affidavit of the petitioners that the petitioners have been able to commence working of the factory by taking prompt steps, after the order is just not correct. The petition was dismissed on August 20, 1983. 30. We are unable to read into the orders of the High Court, its final opinion that the company had made no efforts to get the licence or permit renewed or that it had not taken any anti- pollution measures or that the company, actuated by mala fides refused to allow the workmen to work. Writ Petition No. 1113 of 1983, was filed against an interim order extending time granted to the company to allow its workmen to resume work. It is important to note that the High Court also stressed the need to obtain permit. It only expressed that concrete steps apart from correspondence were necessary. Similarly Writ Petition No. 1664 of 1983 was filed by the company challenging the interim order dated October 5, 1982, directing the company to allow its workmen to report to duty.
It is important to note that the High Court also stressed the need to obtain permit. It only expressed that concrete steps apart from correspondence were necessary. Similarly Writ Petition No. 1664 of 1983 was filed by the company challenging the interim order dated October 5, 1982, directing the company to allow its workmen to report to duty. The High Court did observe that the company was trying to delay the workmen to resume work, but a direction was given to the Industrial Court to dispose of the union's complaint expeditiously. These petitions were filed challenging interim orders. In the nature of things therefore, there cannot be any final adjudication by the High Court, of any of the issues involved. So far as Writ Petition No. 1533 of 1983 is concerned by order dated July 18, 1983, only an arrangement was worked out. Implicit in this arrangement is the need to obtain permit, dependent of course on pollution measures. On August 20, 1983 the company made a clean breast of the fact that it could not undertake slow-firing the furnace by the end of September, 1983. The High Court merely observed that the company's stand that it had been able to commence working of the factory by taking prompt steps is not correct. The arrangement was called off. It is important to note that the High Court has not examined the reasons why the company was unable to take anti-pollution measures and start the factory. In our opinion, therefore, the earlier orders passed by the learned single Judge of this Court, have not concluded any of the issues involved in this petition. 31. We are also unable to countenance the argument that the company has raised the bogey of licence to illegally refuse work to workmen. It is significant to note that the reference filed by the union, contending that the company had declared an illegal lockout was rejected by the Labour Court on January 7. 1985. 32. It was argued that though the company had no licence it carried on its operations for quite sometime and the criminal Court dismissed the prosecution launched against the officers of the company. The company, therefore, could have continued to function. We reject this submission. Permit and licence is a requirement of law.
1985. 32. It was argued that though the company had no licence it carried on its operations for quite sometime and the criminal Court dismissed the prosecution launched against the officers of the company. The company, therefore, could have continued to function. We reject this submission. Permit and licence is a requirement of law. If the company continued to operate without a licence and subjected itself to the peril of prosecution, it did so at its own risk. We certainly cannot hold that the company ought to have continued its operations without a licence. The Tribunal has also not attached much importance to the absence of licence. We are amazed at this. In this connection following observations of the Supreme Court in Life Insurance Corporation of India Vs. Mrs. Asha Ramachandra Ambekar and another, : " 14. Further it is well settled in law that no mandamus will be issued directing to do a thing forbidden by law." 33. The respondents also contended that the company's bona fides are suspected because it did not prefer any appeal when its petition for licence was dismissed. This is not a valid argument. The company repeatedly requested the Corporation to renew its licence. The Corporation had declared its intention to municipalise the company and the Government had also passed resolution on similar lines. Perhaps this may be the reason why they were not interested in renewing the company's licence. The fact that the company filed a writ petition shows its bona fides. Non-filing of appeal in the circumstances cannot be taken against it. In our opinion the Tribunal has wrongly taken this circumstance against the company. 34. As regards air pollution also approach of the Tribunal is alarming. It has observed that there is nothing special about air pollution. That the atmosphere should be pollution free is an ideal way of speaking. But there are other mills which are also emitting pollutants. Therefore, pollution cannot be and should not be a decisive consideration. If this reasoning is to be accepted we will have to give a clean chit to many industries. Fact remains that pollution was a type which could not be controlled despite measures having been taken by the company. Damage caused to the machinery on account of strike would have added to it. Lack of permit and licence is therefore, a valid ground. 35.
Fact remains that pollution was a type which could not be controlled despite measures having been taken by the company. Damage caused to the machinery on account of strike would have added to it. Lack of permit and licence is therefore, a valid ground. 35. We may now turn to the next three reasons of closure which can be dealt with collectively. The company has urged that closure was necessitated because of the colossal damage caused to the plant by the prolonged strike, because of the enormous expenses required for restarting the plant and because of the obstructionist attitude of the Labour Union. The workers went on strike on July 29, 1981. The strike continued for thirteen months. Some of the workmen who wanted to resume work had filed complaint (ULP) No. 632/1982 and an interim order was passed on October 5, 1982 directing the company to allow them to report to duty. The company has submitted that as a consequence of the long drawn out strike, the plant had been damaged and 85% of the retorts were damaged and they cannot be put to use unless they are reconstructed. The order of the Industrial Court shows that it had made an attempt to solicit information from the company as to within what time it would carry out repairs to the plant and obtain permit. Time was given for this purpose. It came to be extended subsequently. Therefore, that there was damage to the machinery is not an afterthought. 36. The judgment of the Labour Court dated January 7, 1985 rejecting the reference made by the Union alleging lockout also supports this. Before the Labour Court the company examined Shri Rajan, the General Manager and two experts who inspected the plant and machinery on behalf of Utadal Technical Services Pvt. Ltd. The said experts gave report about the damage. The estimated cost of repair, as per the report would come to Rs. 68,73,000/-. The amount itself indicates the colossal damage caused to the plant and the machinery. The following portion of the Industrial Court order is important:- "Shri Rajan had stated that 85% of the retort has suffered damage and that gas storage holders had become grounded and the crown has collapsed and that damage has caused to the gas mains at several places. He has also stated that damage has increased with the passage of time.
The following portion of the Industrial Court order is important:- "Shri Rajan had stated that 85% of the retort has suffered damage and that gas storage holders had become grounded and the crown has collapsed and that damage has caused to the gas mains at several places. He has also stated that damage has increased with the passage of time. The evidence of Shri Rajan, the two experts and even of Shri Lilanwala clearly shows that extensive damage was caused to the plant and machinery." 37. After assessing the evidence the Labour Court concluded that there was extensive damage caused to the plant and machinery and it was not possible for the company to start the operations. In the present proceedings, after remand the company examined Mithilesh kumar Sinha, an engineer who has specialised in gas engineering. He inspected the plant and machinery and submitted his report on similar lines. The respondents have not been able to make any dent in his evidence in cross-examination except indicating that he is an employee of the company. Shri Rajan has also deposed about this. He has stated that the cost of restarting would be about Rupees 2 Crores. In our opinion, the damage caused to the plant and machinery and enormous expense required for its restarting is not a false excuse. In the lengthy correspondence, there is a repeated mention of this. 38. In fact the Tribunal has accepted the damage caused to the plant. It has observed that it is not a myth but has gone on to observe that the responsibility cannot be fixed on the workmen alone. The company had no desire to recommence the plant. We find that the Tribunal has fallen into a serious error. It has referred to notices dated August 1, 1981 and August 26, 1981 issued by the company advising the workmen to call off the strike and resume duty. The Tribunal has complemented the company by saying that the company has adopted a healthy approach. But the subsequent inability of the company to allow some of the workmen to resume duty has been taken against the company. In the facts of the case, we find that the subsequent inability of the company was on account of circumstances beyond its control and the illegal strike contributed to it. 39. The obstructionist attitude of the Labour Union is also evident.
In the facts of the case, we find that the subsequent inability of the company was on account of circumstances beyond its control and the illegal strike contributed to it. 39. The obstructionist attitude of the Labour Union is also evident. The strike started on August 24, 1981. The company had displayed various notices requesting the workmen to call of the strike and report to duty. Notices were issued through press also. The notices had no effect on the workmen. The strike came to be declared illegal. Mr. Rajan the General Manager has deposed about the notices. The subsequent willingness of some workmen to resume work is after the damage was caused on account of ongoing strike. We are, therefore, of the opinion, that it is a valid ground which alongwith other grounds led to the closure. 40. As regards loss of market, Mr. Rajan has stated that because of absence of permit and licence, the company could riot receive deposits from customers. It had to return deposit of some customers and there were no additional consumers after 1978. The Tribunal has dismissed this reason by saying that considering the population of the metropolitan city and further the fact that consumers are, preferring fuel gas to professional fuel material, it cannot be said that there has been any -loss of market. Fuel gas has come to stay permanently both in the kitchen as also in the industry. He has further observed that judicial notice can be taken of the fact that, L.P. Gas needs to be supplemented not only by the fuel gas, but by the off-shore gas. Therefore, according to the Tribunal, the loss of market is not a valid reason. So far as the evidence of Shri Rajan is concerned, that the company could not accept deposits from the new customers, that they had to return deposits, that they could not get any new customers after 1978, there is no challenge. The Union has not examined any one to dislodge this statement made by the company's witness. Therefore, we are not going to enter into any surmises and conjectures on this aspect. We find this reason also to be a good reason. In any event, in our opinion, the other reason discussed by us hereinabove are good enough reasons in support of the application for closure. 41. Mr.
Therefore, we are not going to enter into any surmises and conjectures on this aspect. We find this reason also to be a good reason. In any event, in our opinion, the other reason discussed by us hereinabove are good enough reasons in support of the application for closure. 41. Mr. Singh has relied on a judgment of this Court in Maharashtra General Kamgar Union Vs. Vazir Glass Works Ltd. and Others,. In our opinion, in the said judgment, this Court has in fact reiterated the same principles but on facts of that case the Court came to a conclusion that the Tribunal had ignored and/or not considered the relevant material. The High Court found that the closure was not genuine because the financial losses which the respondent company had incurred were created by the company itself by floating another company. The Tribunal in that case had come to the conclusion that the cost of production of the respondent company vis-a-vis its competitive industry in the State of Gujarat was cheaper on account of the availability of gas at cheap rates as also other fuels. The High Court observed that the L.P.G. was using other fuels like furnace oil and that furnaces were so equipped that they could be run on electricity. The Tribunal had overlooked this aspect while considering the increase in the cost of L.P.G. The Tribunal had also compared the cost of production of the respondent company and another company based in Gujarat. On examining the facts, the High Court came to a conclusion that such a comparison was unreasonable because it was not shown that the other company was purchasing broken glasses from outside. The Tribunal had come to conclusion that the furnace cannot be rebuilt without spending Rs. 2 crores. There was evidence on record that after its closure the company had paid nearly about Rs. 5 crores for payment of wages. Therefore, the respondent company's case that it had no money to rebuild furnace was not true and the Tribunal had ignored this aspect. The Tribunal had also considered the fact that the respondent company was not viable whereas, the balance sheet showed reserves and surplus of Rs. 5 crores. The Tribunal had also found that the respondent company had set up another factory which was not a distinct and different company, but a sister concern of the same company.
The Tribunal had also considered the fact that the respondent company was not viable whereas, the balance sheet showed reserves and surplus of Rs. 5 crores. The Tribunal had also found that the respondent company had set up another factory which was not a distinct and different company, but a sister concern of the same company. The said new company was a creation of the respondent company and the financial problems of the respondent company had arisen on account of setting up of the said new company. Therefore, on the facts of that case, the High Court found that the closure was mala fide and the reasons were not adequate and genuine. As regards the public interest the High Court came to a conclusion that the respondent company had not taken steps to prevent closure. It had means to rebuild furnace and commence production. It did not exhaust the avenues of improving the economic viability of the company. The company had created avoidable unemployment which was against the public interest. 42. In our opinion, the facts of the present case are different. The basic difficulty of the company was that it had no licence. Evidence on record shows that there was illegal strike on account of which the company remained closed for about 13 months, causing extensive damage to the machinery. Inspite of its best efforts the company could not prevent pollution. The cost of restarting the company after repairing it and taking anti-pollution measures would be enormous. Moreover, there was no guarantee that the company would not be municipalised. There was a considerable loss in the market. There is no evidence on record to show that the company had by its own action brought about its activity to a halt. Various factors had contributed to it. We are, therefore, of the opinion, that the judgment of the Bombay High Court in Vazir Glass's case (supra) is not applicable to the facts of the case. 43. Mr. Singh also submitted that the company was economically sound. Economic stringency was never the ground for closure. Assuming it to be so, in our opinion, in the ultimate analysis it will have to be said that the reasons for closure are genuine and adequate and the interest of general public are not adversely affected. We hold that the company did make efforts to comply with anti-pollution requirements.
Economic stringency was never the ground for closure. Assuming it to be so, in our opinion, in the ultimate analysis it will have to be said that the reasons for closure are genuine and adequate and the interest of general public are not adversely affected. We hold that the company did make efforts to comply with anti-pollution requirements. It repeatedly requested the Corporation and the Government to renew its permit and licence which they declined to do. Resolution to municipalise the company had already been passed. Workers went on illegal strike. For thirteen months machinery was idle. Extensive damage was caused to it. Enormous cost would have to be incurred for its repairs. After repair chances of its causing more pollution could not be cured completely. The residents of the locality were agitating about the pollution. It would not be in anybody's interest to run such a factory. In the absence of licence the employer cannot be expected to run the factory. The company did try to prevent closure and avoid unemployment. But the circumstances were beyond its control and closure became inevitable, in our opinion, the closure is bona fide. We also see no substance in the argument advanced by the respondents that the closure was effected because the company wanted to enter into any land deals and make profit. The respondents have not been able to make out any such case. 44. In the result, we set aside the impugned judgment and order dated March 13, 1987 passed by the Industrial Tribunal, Maharashtra, Bombay and restore the order dated September 23, 1983 passed by the then Minister of State for Labour, Government of Maharashtra in place thereof. 45. The petition is disposed of in the restated terms. 46. The request made on behalf of the respondent herein is rejected for the reason that the factory is not manufacturing anything today and there is no use of granting any stay because even if that request is granted, the production will not commence. The request for stay of this order is therefore rejected. 47. Ordinary copy be given to the parties. Parties to act on an ordinary copy of this order duly authenticated by the Associate of this Court. 48. Writ certified copy by expedited.