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Punjab High Court · body

2007 DIGILAW 2073 (PNJ)

Delton Cable Employees Union (Regd. ) v. State Of Haryana

2007-11-28

K.C.PURI

body2007
Judgment K.C.Puri, J. 1. Feeling dissatisfied with the orders dated 2.3.1985 and 21.5.1985, Annexure P-3 and P-4, passed by respondent No. 1, the petitioner has filed this writ petition with a prayer to set aside the said orders. 2. It is pleaded by the petitioner that respondent No. 2 is a factory registered under the Factories Act and a licence has been issued by the State of Haryana for running the said factory. In the said factory, more than 1000 employees are working. The factory is manufacturing cables. The factory had different departments which are co-related. No department can function independently without the help of other. The employees are transferable from one department to another and for all purposes, the departments are functionally integrated. In addition to regular strength, the respondent No. 2 employs casual employees frequently. 3. It is further pleaded that the members of the Union who are employees of respondent No. 2 were in employment on regular basis for the last more than a decade. There was a settlement with regard to the terms and conditions of employment and the period of settlement was three years and the expiry of this settled period was brought to the notice of respondent No. 2. In order to victimise the employees, the respondent No. 2 mala fidely decided to close down one of the departments of the factory which was otherwise a part and parcel of the factory and the manufacturing process. In the said department, more than 80 industrial workers were employed and in order to achieve closure and to victimise the workers, respondent No. 2 issued letter dated 2.12.1984 (Annexure P-1) in which it was written that in the department proposed to be closed down, the strength was less than 100. Therefore, no sanction as prescribed under Section 25-O of the Industrial Disputes Act (in short the `Act) was required and in the concluding para, permission was sought for the closure of the Wire Mill Department. 4. It is further pleaded that according to Sections 25-O, 25-E and 25-L, respondent No. 2 is industrial establishment for the purposes of Chapter 5-B of the Act and the employment strength in the said industrial establishment was more than 1000 and in order to close down a part of such industrial establishment, sanction from the appropriate i.e. respondent No. 1 was prescribed in Section 25-O of the Act. Section 25-O(1) further prescribed that while submitting an application to the State for permission, a copy of such application was also to be served on the representatives of the workmen whereas in the present case, a copy of such letter has not been sent to the petitioner till 4.1.1985 and, thus, respondent No. 2 has violated the basic requirement of Section 25-O(1) solely with the intention to keep the affected workmen in dark and to achieve the malicious and mala fide end. 5. It is further pleaded that a copy of the notice of the application seeking permission for closure was given to the petitioner on 4.1.1985. The representatives of the Union did their best to persuade the management not to close down the department and, in this respect, held several meetings with the management but all the efforts of the Union proved futile and the Union then submitted a representation to respondent No. 1 with the prayer that permission to close down the particular department be not granted. No opportunity was given afforded to the petitioner. Rather order dated 2.3.1985 was passed although the representation of the petitioner was pending with respondent No. 1. The said order is vague inasmuch as it does not disclose whether the sanction was granted or rejected. 6. In the written statement filed by respondent No. 1, it was admitted that respondent No. 2 is an industrial establishment and the total employment strength in the said establishment was more than 1000 but it was denied that for closing down a part of such establishment in which less than 100 workers were working and which could be separated from the industrial establishment, any sanction from the appropriate Government was required. It was also pleaded that the representation of the petitioner was dismissed by respondent No. 1 as the Government had taken a decision earlier. The orders of respondent No. 1 were legal, sustainable, constitutional and were not against the basic requirements of the Act. It is further submitted that respondent No. 1 agreed with respondent No. 2 on the point that there was no need to seek permission for closing the unit because the said unit was a separate unit and workmen strength employed in that unit was less than 100. 7. Respondent No. 2 filed separate written statement controverting the averments made in the writ petition. 7. Respondent No. 2 filed separate written statement controverting the averments made in the writ petition. It is pleaded that the copy of application, Annexure P-1, was supplied to the petitioner-Union. Objections, Annexure R-2/1/T, against the same were raised by the petitioner-Union and then a hearing was given by the Deputy Labour Commissioner to the petitioner and the respondent No. 2. It is further pleaded that the petitioner filed representation dated 28.3.1985 which was dismissed vide order dated 20.5.1985 Annexure P-4. It was denied that closure of the department was resorted to by any mala fide intention. The said closure was effected in the best interests of the factory, considering economic viability. It was also denied that application, Annexure P-1 was filed with a view to victimise the workmen. 8. I have heard arguments of counsel for the parties and have gone through the record of the case. 9. The petitioner in this writ petition has challenged the vires of Section 25-O(3) of the Act on the ground that it gives uncontrolled, unguided powers on the respective States to close the industrial unit. However, during the course of arguments, nothing has been argued on this point. Otherwise also, there is no illegality or the said provision of law cannot be said to be unconstitutional. So, the validity of said provision of law is upheld. 10. The challenge is to Annexure P-3 which is letter dated 2.3.1985 of the Labour Commissioner, Haryana vide which the Government had agreed to the closure of M/s. Delton Cables Limited, Faridabad and Shri Kulwant Singh, IAS, Financial Commissioner and Secretary to Government, Haryana, Labour & Employment Department Chandigarh, vide order dated 21.5.1985 had declined the review petition filed by Union workmen regarding closure. 11. During the pendency of the writ petition, respondent No. 2 moved an application to the effect that at the time of institution of the writ petition, as many as 82 employees were members of the petitioner Union and have challenged the impugned order. However, from the time of the institution of the petition till 2003, as many as 76 employees have settled their dispute with respondent No. 2 and got their dues in accordance with law. However, from the time of the institution of the petition till 2003, as many as 76 employees have settled their dispute with respondent No. 2 and got their dues in accordance with law. Only six employees namely Sarvshri Tula Ram, Jiya Ram, Vijya Kumar, Brij Kumar, Vipati Singh and Mam Chand have not settled their dispute and these persons moved to the Government of Haryana for their re-employment in terms of Section 25-H of the Act and have made reference under Section 10(1) of the Act. The Government of Haryana vide order dated 17.3.2003 referred the said dispute for adjudication to the Labour Court, Faridabad and the same is still subjudice. The respondent No. 2 has also filed written statement in those references. The petitioner has resorted to alternative and efficacious remedy under the Act and as such the writ petition has been rendered infructuous. 12. Notice of the application was given to the petitioner. The petitioner denied the contents of the petition. It was pleaded that making a reference under Section 25-H of the Act has no relevancy in respect of closure of unit under Section 25-O of the Act. 13. Respondent No. 2 again moved an application under Section 151 of CPC in which it is pleaded that the present writ petition has been filed by M/s. Delton Cables Employees Union and the said Union has ceased to exist on 3.8.2007. Since the unit is not in existence, hence the writ petition cannot proceed in the absence of a juristic person. It is pleaded that in CM No. 13556 of 2006, it is stated that only six employees had been left who were interested to continue with the writ petition. The remaining employees have received their dues in accordance with law. The respondent No. 2 has offered to accommodate all those employees named above except Jiya Lal who has since expired. The respondent No. 2 is having a factory by the name of M/s. Delton Cables Limited, 70th Milestone, Delhi-Jaipur Highway, Opposite Village Malpura, Dharuhera, District Rewari (Haryana). The said events be taken into consideration. The said prayer has also been opposed by the counsel for the petitioner. 14. I have considered the submissions made by both sides in CM Nos. 18796 of 14.11.2007 and 13556 of 2006. 15. Both the Civil Miscellaneous Applications do not carry any weight. The said events be taken into consideration. The said prayer has also been opposed by the counsel for the petitioner. 14. I have considered the submissions made by both sides in CM Nos. 18796 of 14.11.2007 and 13556 of 2006. 15. Both the Civil Miscellaneous Applications do not carry any weight. Even according to respondent No. 2, six employees out of 82 employees whose services have been retrenched on account of one department of respondent No. 2, have a right to pursue the writ petition. No compromise deed in respect of 76 employees who are said to have compromised with respondent No. 2 has been placed on the file. The fact remains that unless and until the grievance of the employees is redressed, in that case even one employee can continue to challenge the impugned order. 16. It is admitted case of the parties that M/s. Delton Cables Employees Union Faridabad had more than 1000 employees at the time of closure in question. Respondent No. 2 submitted application dated 2.12.1984 to the Secretary to Government, Haryana, Labour Department, Chandigarh, Annexure P-1 for closing Wire Mill Department of the factory. It is mentioned in Annexure P-1 that the said department employs less than 100 employees. Section 25-O of the Act is not applicable as according to respondent No. 2 less than 100 employees are working in the said department. It is further mentioned in the said Annexure that as an abundant caution, permission for the closure of Wire Mill Department has been sought. M/s. Delton Cables Employees Union vide Annexure P-2 opposed the closure. The Labour Commissioner, Haryana, vide order dated 2.3.1985 agreed to the points raised in the application dated 2.12.1984, vide Annexure P-3. The Financial Commissioner and Secretary to Government, Haryana, Labour and Employment Department, Chandigarh vide order dated 21.5.1985 over-ruled the objections of the workmen Union and held the closure as valid. Annexure P-3 and P-4 have been challenged in the present writ petition. 17. Closure has been defined in Section 2(cc) of the Act which is reproduced hereunder :- "closure" means the permanent closing down of a place of employment or part thereof". 18. Prior to 21.8.1984, closure meant permanent closing of the place of employment "or Part thereof" has been added by Act 46 of 1982, with effect from 21.8.1984. 19. 17. Closure has been defined in Section 2(cc) of the Act which is reproduced hereunder :- "closure" means the permanent closing down of a place of employment or part thereof". 18. Prior to 21.8.1984, closure meant permanent closing of the place of employment "or Part thereof" has been added by Act 46 of 1982, with effect from 21.8.1984. 19. The main question for determination is whether the closure of Wire Mill Department of respondent No. 2 is valid and legal. Under Section 25-O(2), it has been laid down that appropriate Government, after making such enquiry as it thinks fit and after giving a reasonable opportunity of being heard to the employer, the workmen and the persons interested in such closure may, having regard to the genuineness and adequacy of the reasons stated by the employer, the interests of the general public and all other relevant factors, by order and for reasons to be recorded in writing, grant or refuse to grant such permission and a copy of such order shall be communicated to the employer and the workmen. From the perusal of paper book, it is revealed that respondent No. 1 sent request, Annexure P-1, vide letter dated 21.2.1984. The petitioner-Union submitted detailed objections vide letter dated 26.2.1985 to the Secretary to the Government of Haryana, Labour Department, Chandigarh vide Annexure P-2. The Labour Commissioner, Haryana vide Annexure P-3, has accepted the proposal without giving any reason for accepting the request. So much so workmen were not heard before passing the said order. Neither M/s. Delton Cable Employees Union has given any reasoning for closing Wire Mill department nor the Labour Commissioner, Haryana, has given any reasoning for allowing the request. The said order, Annexure P-3, is against the spirit of Section 25-O(2) of the Act wherein it is mentioned that order of closure can be passed only by giving reasons to be recorded in writing. Such approach of the Government cannot be appreciated. 20. Otherwise also, the action of respondent No. 2 in making the proposal for closing down one department of the factory i.e. Wire Mill seems to be mala fide. No reasoning has been given in Annexure P-1 for closure. The order of closure is void, illegal and against the spirit of Section 25-O(2). 21. 20. Otherwise also, the action of respondent No. 2 in making the proposal for closing down one department of the factory i.e. Wire Mill seems to be mala fide. No reasoning has been given in Annexure P-1 for closure. The order of closure is void, illegal and against the spirit of Section 25-O(2). 21. Order dated 21.5.1985, Annexure P-4 does not help the respondents as the same has been passed after acceptance of proposal by the Labour Commissioner regarding demand of closure of Wire Mill Department. 22. There is nothing on the file that one department which is said to have been closed is separate from the other factory. The respondent No. 2 is dealing in the manufacture of cables and respondent No. 2 has failed to prove the fact that how the Wire Mill Department was not needed in the manufacturing concern of respondent No. 2. The motive for closure of respondent No. 2 is only to terminate the services of the employees. 23. So far as the submission of respondent No. 2 to the effect that no Government sanction was required under Section 25-O is concerned, that submission is without any substance. As discussed above, 1000 employees were working in the factory of respondent No. 2 and closure of Wire Mill Department is only meant to drive (drive ?) the benefit of Section 2(ee) by underhand means. 24. Respondent No. 2 has allegedly entered into a compromise with 76 employees out of total of 82 employees of Wire Mill Department. According to respondent No. 2, 76 employees have been paid compensation. By pleading the said fact, respondent No. 2 has indirectly admitted the factum that the closure is illegal. Had the closure been legal, those 76 employees would not have been allowed to compromise. Through Civil Misc. Application No. 18796 of 2007, the respondent No. 2 has offered the services to five employees in another factory at Rewari and that act of respondent No. 2 further goes a long way to prove the fact that respondent No. 2 has taken the order of closure as not valid. So, the above point stands answered in favour of the petitioner and against respondent No. 2. 25. In view of the above discussion, Annexure P-3 and P-4, referred to above, stand quashed after accepting the writ petition. It is held that closure is illegal and against the spirit of the Act. So, the above point stands answered in favour of the petitioner and against respondent No. 2. 25. In view of the above discussion, Annexure P-3 and P-4, referred to above, stand quashed after accepting the writ petition. It is held that closure is illegal and against the spirit of the Act. So, the employees who have not compromised with respondent No. 2 shall get all the benefits, under rules. Petition allowed.