JUDGMENT 1. - Management of company (respondent No.3) made an application on August 9, 1984 under Section 25-O of the Industrial Disputes Act, 1947 (for short 1947 Act') seeking permission to close down Sudershan Textiles Mills Kota (for short 'STM') with effect from October 9, 1984. The appellants Unions however opposed the application and the State Government vide its order dated October 5, 1984 refused permission for closure. The Management of Company then filed review application under Section 25-O(5) of 1947 Act on October 8, 1984. The matter was referred by the State Government to the under Ordinance 18 of the Rajasthan High Court Ordinance, 1949 against judgment dated 14.9.90 of the Hon'ble Single Judge, in SBCWP No. 700/85. Industrial Tribunal Kota for adjudication. The Tribunal vide its Award dated March 6, 1985 held that order dated October 5, 1984 was illegal and closure of STM was just and legal. The said Award was assailed by the Unions by filing writ petition in the High Court. Learned Single Judge however did not find merit in the writ petition and dismissed the same on September 14, 1990. Against this judgment of learned Single Judge that this appeal has been filed by the Unions. BRIEF FACTS : 2. Contextual facts depict that STM employing nearly 1500 workers, both Permanent and Badlis, was earlier known as Shri Gopal Industries Ltd. This Company got amalgamated with Maharaj Shri Ummed Mills Ltd. Pali with effect from January 1, 1978, vide High Court's order dated September 7, 1978. The High Court indicated in the said order thus : "The scheme of amalgamation of the transferor company into transferee company has been agreed to by the Board of Directors of both the Company with the object of rehabilitating and reviving the transferor company so that there may be no unemployment of workers by closure of the transferor company and also avoiding production losses. Both the companies carry on the business of textiles, therefore, similar in nature and inter-connected." (Emphasis Supplied) 3. Management of company on August 8, 1984 moved an application under Section 25-O of the 1947 Act for permission to close down its undertaking namely the STM Kota with effect from October 9, 1984. The Unions opposed the application.
Both the companies carry on the business of textiles, therefore, similar in nature and inter-connected." (Emphasis Supplied) 3. Management of company on August 8, 1984 moved an application under Section 25-O of the 1947 Act for permission to close down its undertaking namely the STM Kota with effect from October 9, 1984. The Unions opposed the application. State Government after hearing both the parties vide order dated October 5, 1984 refused the permission for closure on the following grounds : (a) that STM formerly known as Shri Gopal Industries Ltd., Kota was amalgamated with Maharaja Shree Umaid Mills Ltd. w.e.f., January 1, 1978 for its rehabilitation, revival and to avoid unemployment of the workers due to the likely closure of that company, (b) that Maharaja Shree Umaid Mills Ltd., and STM both were engaged in the business of textiles and thus not only similar in nature, but are also inter connected. (c) that Maharaja Shree Umaid Mills Ltd. of which STM is a unit has shown profits during the years 1982-83 and 1983-84. (d) that Shree Gopal Industries Ltd. Kota now known as STM has shown profit in the year 1979 after amalgamation with Maharaja Shree Ummaid Mills Ltd. (e) that though STM has shown losses in the year 1982-83 and 1983-84, these losses can be averted in future if adequate interest free funds for investment are made available to this unit out of the reserve of Maharaja Shree Umaid Mills Ltd. to revive and rehabilitate this unit. (f) that the workers of this unit hive given increased production during the year 1983-84 as compared to the out-put for the year 1982-83. Thus the workers could in no way be blamed for the losses incurred by this unit. (g) that if management is properly streamlined and good quality of raw materials is made available, there would be little possibility of the unit incurring losses in future." The State Government was of the opinion that there was no adequate and sufficient justification for the closure of the unit. (Emphasis supplied) 4. Being aggrieved of the refusal by State Government the Management moved application under Section 25-O(5) of the 1947 Act on October 8, 1984. The State Government referred the matter to Industrial Tribunal Kota for adjudication with a direction to submit its decision to Government within thirty days from the date of reference.
(Emphasis supplied) 4. Being aggrieved of the refusal by State Government the Management moved application under Section 25-O(5) of the 1947 Act on October 8, 1984. The State Government referred the matter to Industrial Tribunal Kota for adjudication with a direction to submit its decision to Government within thirty days from the date of reference. Term of reference dated November, 27, 1985 were as under : "Therefore, the State Government acting under Section 25-O(5) of the Industrial Dispute (Rajasthan Amendment) Act (Act No. 80 of 1984) refers the said review application to the Industrial Tribunal Kota. Whether the application of closure by Messers Sudershan Textiles (Pro. M.S.K. Mills Ltd.) Rangpur Road Kota is just and legal. The Industrial Tribunal shall submit its decision to the State Government within 30 days of the reference." The order of reference and other relevant papers i.e. Company's application, documents etc. were received by the Tribunal on November 28, 1984 and it was registered on the same day as case No. ITR 24 of 1984. 5. The Industrial Tribunal Kota invited statement of claim and replies and re-replies, recorded oral and documentary evidence of parties instead of relying on the record submitted by the State Government, heard arguments on February 2, 1985. The Tribunal upheld every one of the pleas of the company and held that the Government order dated October 5, 1984 was unjust and not in accordance with Section 25-0(2) of the 1947 Act. It also found the application of company for closure just and legal. 6. Aggrieved of the award dated March 6, 1985 the Unions filed writ petition in the High Court on April 8, 1985. On May 13, 1985 the High Court admitted the petition and passed an interim order awarding 50% wages to the workmen effected by closure. After hearing both the sides, learned Single Judge rejected the writ petition vide order dated September 14, 1990. 7. Assailing the judgment of learned Single Judge instant appeal has been filed. Procedure Prescribed Under Section 25-0 OF 1947 ACT : 8. Before considering the rival submissions advanced before us, it will be appropriate to refer the provisions contained in Section 25-0 of 1947 Act, which read thus : "25-O Procedure for closing down an undertaking.
7. Assailing the judgment of learned Single Judge instant appeal has been filed. Procedure Prescribed Under Section 25-0 OF 1947 ACT : 8. Before considering the rival submissions advanced before us, it will be appropriate to refer the provisions contained in Section 25-0 of 1947 Act, which read thus : "25-O Procedure for closing down an undertaking. (1) An employer who intends to close down an undertaking of an industrial establishment to which this Chapter applies shall, in the prescribed manner, apply, for prior permission at least ninety days before the date on which the intended closure is to become effective, to the appropriate Government, stating clearly the reasons for the intended closure of the undertaking and a copy of such application shall also be served simultaneously on the representatives of the workmen in the prescribed manner : Provided that nothing in this sub-section shall apply to an undertaking set up for the construction of building, bridges, roads, canals, dams or for other construction work. (2) Where an application for permission has been made under sub-section (1), the 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 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. (3) Where an application has been made under sub-section (1) and the appropriate Government does not communicate the order granting or refusing to grant permission to the employer within a period of sixty days from the date on which such application is made, the permission applied for shall be deemed to have been granted on the expiration of the said period, of sixty days. (4) An order of the appropriate Government 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.
(4) An order of the appropriate Government 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 : Provided that where a reference has been made to a Tribunal under this sub-section, it shall pass an award within a period of thirty days from the date of such reference. (6) Where no application for permission under sub-section (1) is made within the period specified therein, or where the permission for closure has been refused, the closure of the undertaking shall be deemed to be illegal from the date of closure and the workmen shall be entitled to all the benefits under any law for the time being in force as if the undertaking had not been closed down. (7) Notwithstanding anything contained in the foregoing provisions of this Section, the appropriate Government may, if it satisfied that owing to such exceptional circumstance. s as accidents in the undertaking or death of the employer or the like it is necessary so to do, by order, direct that the provisions of sub-section (1) shall not apply in relation to such undertaking for such period as may be specified in the order. (8) Where an undertaking is permitted to be closed down under sub-section (2) or where permission for closure is deemed to be granted under sub-section (3), every workman who is employed in that undertaking immediately before the date of application for permission under this section, shall be entitled to receive compensation which shall be equivalent to fifteen days' average pay for every completed year of continuous service or any part thereof in excess of six months." Preliminary Objection Regarding Maintainability of Appeal : 9. Mr. M.S. Singhvi, learned counsel appearing for the respondent company raised preliminary objection in regard to maintainability of appeal. It was canvassed that the appellant Unions were registered under the Trade Union Act, 1926. The registration of the appellant No.1 and 3 came to be cancelled on March 6, 1985.
Mr. M.S. Singhvi, learned counsel appearing for the respondent company raised preliminary objection in regard to maintainability of appeal. It was canvassed that the appellant Unions were registered under the Trade Union Act, 1926. The registration of the appellant No.1 and 3 came to be cancelled on March 6, 1985. The registration of appellant No.2 was cancelled by the Competent Authority vide order dated September 14, 1992. Neither the registration of the appellants have been revived nor they have been registered. Since they have ceased to be registered union, the appeal filed by them cannot be maintained as they do not enjoy status of Corporate body and cannot sue in their names. Reliance is placed on the (1) RSEB Account Association v. RSEB 1995 (1) RLR 117 , wherein Full Bench of this court indicated thus:- (Paras 7 & 8) "7. It may also be observed that an unregistered association has no fundamental right to approach this Court under Article 226 of the Constitution and this point is concluded the decision in the case of Shri Mahinder Kumar Gupta v. Union of India, Ministry of Petroleum and Natural Gas [JT 1995 (1) SC 11J . A decision in the case Akhil Bhartiya Soshit Karamchari Sangh v. Union of India and other [ AIR 1981 SC 298 ] was relied where the non-recognised Association was held to apply under Article 32 of the Constitution. We may observe that there had been number of the instancers of public litigation where large body of persons is having the grievance against inaction of the State. Even letters have been considered to be a writ petition but all these are the matters where large section of public is affected and the personal interest of any particular person or a similar section, as in the present case, is not involved. Even in the case of People's Union for Democratic Rights v. Union of India ( AIR 1982 SC 1473 ) when the question of locus standi was considered, the Hon'ble Supreme Court had taken into consideration the poverty illiteracy and ignorance, obstructing and impeding accessibility to the judicial process and on that ground it was considered that writ petition can be filed.
In DS Nakara v. Union of India [ AIR 1983 SC 1301 the old pensioners individually were unable to undertake journey through labyrinths of costly and protected (sic protracted) judicial process for allowing to espouse their cause. In case of SP Gupta v. President of India [AIR 1982 SC 1491 poverty, helplessness and disability or social or economic disadvantaged, position was considered a sufficient ground for maintaining the writ petition. There had been other decisions of the Apex Court as well as principles which emerge from all of them are as under : a. that the members of the said association should have sufficient strength so as to come in the category of a large sect of public; b. that the members should be identified; c. that the members must be of the category of poor/illiterate/helpless or disable; d. that the individual member must not be capable of filing a writ petition; e. that the entire body of the members must authorise the association to protect their legal rights; f. that such an association must have its own Constitution; and g. that there must be authority to file a writ petition on behalf of all the members. 8. If all the above conditions are fulfilled, then an unregistered association can file a writ petition in respect of the legal right but the said association cannot file a writ petition alleging breach of fundamental right as the association by itself has no fundamental rights of its own." 10. Having scanned the material on record we noticed that nearly 1500 workers both permanent and badlis were employed by STM and those workers were the members of the appellant unions. In respect of legal rights of large sect of helpless workers, even unregistered Unions could approach the High Court under Article 226 of the Constitution. Cancellation of registration of appellant Unions in our opinion is immaterial for pursuing appeal before the Division Bench against the judgment rendered by learned Single Judge. In exercising the power under Article 226, the Court should not forget the object with which procedural technicalities have been relaxed viz. to provide easy excess (sic 'access'?) to justice to the weaker sections of humanity and to combet exploitation and injustice and to secure to the under-privileged segments of society their social and economic entitlements. We thus find no merit in the preliminary objection and reject the same.
to provide easy excess (sic 'access'?) to justice to the weaker sections of humanity and to combet exploitation and injustice and to secure to the under-privileged segments of society their social and economic entitlements. We thus find no merit in the preliminary objection and reject the same. Submissions Of Appellants : 11. The grounds of attack on behalf of appellant Unions as argued by their learned counsel Mr. Kashyap may be summarised as under : "(i) The award was passed on March 6, 1985 on a reference made to Tribunal by the State Government on November 18, 1984, i.e. after a lapse of nearly 96 days, while its jurisdiction in the matter of present reference, expired after 30 days, in view of the mandatory provisions of Section 25-O(5) of 1947 Act. Thus proceedings before the Industrial Tribunal including the Award dated March 6, 1985 after 30 days of the date of reference, should have been held null and void, being carried out without jurisdiction but the Single Judge held that the provisions of Section 25-0(5) are not mandatory but only directory and the proceedings before the Tribunal will not. lapse after 30 days. Thus finding of Single Judge are contrary to the provisions of law. (ii) In coming to the conclusion that provisions of Section 25-O(5) of 1947 Act are only directory, learned Single Judge relied on the judgment Rastriya Gypsum Mazdoor Sangh v. Union of India [1986 WLN (4-C) 189] and Mineral Exploration. Corporation Employees Union v. Union of India SB Civil Writ Petition No. 1630/86 decided on September 30, 1986. Learned counsel for the appellants contended that in these two judgments the point of mandatory or otherwise nature of provisions of Section 25-O(5) of 1947 Act were neither contested nor argued and the observations therein were mere observations. (iii) Learned Single Judge overruled the following decisions of Hon'ble the Supreme Court on the ground that the same were delivered in the matter of UP Industrial Disputes Act and provisions of which are not pari materia to the provisions of Industrial Disputes Act, 1947. 1. The Stawboard Manufacturing Co. Ltd. v. Gutta Mill Workers Union ( AIR 1953 SC 95 ) . 2.
1. The Stawboard Manufacturing Co. Ltd. v. Gutta Mill Workers Union ( AIR 1953 SC 95 ) . 2. The Workers of Indian Colliery v. The Management ( AIR 1953 SC 88 ) In these cases the award of adjudicator were held null and void because they were passed after the period specifically provided under the order of reference. Learned Single Judge wrongly held that the law laid down by Hon'ble Supreme Court is not applicable to the present case. (iv) Learned Single Judge merely ignored the specific direction of State Government in the order of reference that the Industrial Tribunal shall submit its decision to State Government within 30 days of the reference. These specific directions too have statutory effect and the jurisdiction of the Tribunal expires after 30 days. Thus the award of Tribunal submitted after the expiry of 30 days is null and void. (v) Learned Single Judge failed to consider the argument that 1947 Act provides for expeditious disposal of disputes and various provisions of 1947 Act Sections 10(2-A), 12, 13, 14, 15, 33, 33-e etc. provides time limit for decision of Industrial Tribunal/Labour Court/Conciliation Officers/Arbitrators etc., but in these provisions extension of time limit have been provided, while under Section 25-0(5) of 1947 Act no provision of extension of time limit of 30 days has been provided, therefore sub-section should be held to be mandatory. (vi) Learned Single judge held that provisions of Section 25-0(5) of 1947 Act are directory and not mandatory on the ground that no consequence have been provided in the law if the Tribunal fails to make its order within specified period of 30 days, the order of State Government passed under Section 25-0(5) will prevail and be operative. (vii) Learned Single Judge also failed to consider the argument that provisions of Section 25-0(5) of 1947 Act are of transitory and temporary nature and the order of State Government or order passed on review application or by Tribunal are operative only for a period of one year, thereafter parties can makes fresh application and for these reasons the time limit of 30 days for the Tribunal to pass order on the review application should be treated as mandatory.
(viii) The order of learned Single that the order dated October 5, 1984 of State Government is cryptic that it does not give reasons for its conclusion is therefore bad in law, is not only factually incorrect but also against the provisions of Section 25-O(5) of 1947 Act. The order of State Government refusing permission to respondent No.3 or closure of its undertaking namely STM has been made after a complete inquiry held as required under Section 25-O(2) of 1947 Act. It gives detailed reasons and suggests certain steps to revive the undertaking. There is no reason why the respondent should not have followed the directions given in order of State Government thereafter the Industrial undertaking would not have been made progress, it could make after expiry of one year fresh application for closure. (ix) Learned Single Judge further erred in holding that the Industrial Tribunal once a reference has been made to it under Section 25-O(5) of 1947 Act has to hold a full and afresh inquiry, taking fresh documents and evidence, as if it is an Industrial disputes referred to it. Under Sections 25-O(5) of 1947 Act what is referred to the Tribunal is the Review application made by respondent No.3 against the order of State Government dated October 5, 1984. Thus the Tribunal was called upon only to see whether the order of the State Government is prima facie just and fair on the basis of facts placed before the State Government. (x) Learned Single Judge also erred in not considering the submission of appellants regarding the manner and the method of financial liability of the undertaking on that ground that in the extra ordinary writ jurisdiction, he will not enter into evidence and finding of the Tribunal on merits. While the closure has been sought by the respondent No.3 on the ground of financial difficulties, the facts and manner in which it was placed before the Tribunal by respondent No.3 were challenged by the appellants. The Tribunal wrongly brushed aside the objections of the appellants though the same were based on judicial pronouncement. Thus refusal to go into the evidence and Award of the Tribunal amounts to denial of justice to appellant." Submissions Of Respondent Company : 12. While supporting to award of the Tribunal and findings of learned Single Judge learned counsel for the respondents company Mr.
Thus refusal to go into the evidence and Award of the Tribunal amounts to denial of justice to appellant." Submissions Of Respondent Company : 12. While supporting to award of the Tribunal and findings of learned Single Judge learned counsel for the respondents company Mr. Singhvi has made the following submissions : (i) The STM has closed down its operation from March 6, 1985 and no activity at all in the factory or office continued or taken place after this period. After closure about 17 years elapsed and by this time not only the machinery but even the premises including the factory premises, residential accommodation, offices and godowns have been completely in dilapidated conditions and not fit for use in any manner. The machinery is worth scrap value and cannot be used for any purposes whatsoever. Moreover the machinery which was installed even at that time had become outdated and could not be continued even in that state. (ii) The total closure compensation payable to the employees affected by the closure was worked out to be Rs. 25,27,783/- and the respondent Mill paid a sum of Rs. 81,53,815/-. In addition to this Rs. 31,88,393 (approx.) has been paid towards gratuity, Rs. 646.757 (Approx.) have been paid towards bonus and Rs. 3,71,242 (appox.) have been paid towards leave wages. The excess amount had been paid under the interim order of this Court dated May 13, 1985 in writ petition No. 700/85 and the Court in final decision ordered that the excess amount shall not be recovered by the STM. (iii) Compensation amount has been paid to all the employees affected by the closure except only four employees and the total dues come to Rs. 27120/- which the respondent Mill had tendered and still ready and willing to pay them on claim being made. (iv) The appellants challenged the order of the learned Single Judge and the order of the Tribunal mainly on the ground that the award was not passed within 30 days of the reference as provided for in Section 25-0(5) of 1947 Act. The appellants having participated in the entire proceedings including the proceedings before the learned Tribunal after expiry of 30 days without raising an iota of objection regarding the expiry of limitation. (Vide Sohan Singh v. The General Manager, Ordinance Factory AIR 1981 SC 1876) .
The appellants having participated in the entire proceedings including the proceedings before the learned Tribunal after expiry of 30 days without raising an iota of objection regarding the expiry of limitation. (Vide Sohan Singh v. The General Manager, Ordinance Factory AIR 1981 SC 1876) . (v) The appellants cannot be allowed to take advantage of their own conduct. The appellants were responsible for the delay in award and now they cannot be permitted to go back full circle and claim the award null and void on the ground of delay. The respondent relied on the judgment of learned Single Judge as well as the list of dates to show the delay caused by appellants. If the provisions are considered to be mandatory and the time limitation is to be followed strictly, then it will render the proceedings in every case infructuous if a party by its own conduct will see that the case is no decided within stipulated time. (vi) The participation by the appellants in the proceedings before the Tribunal would amount to waiver of mandatory conditions. In fact it was in the interest of all the parties that such a condition be not followed mandatorily as it would result in unnecessary multiplicity of proceedings and other complications including conduct of proceedings without due deliberation and appreciation of evidence. The Court would refrain from interfering even if there is a violation of mandatory provisions. (Vide Rajendra Singh v. State of MP (1996) 5 SCC 460 ). (vii) The object of the power for review provided under Section 25-0 so also as in 25-M, 25-N etc. of 1947 Act is to do justice between the parties by considering whether the original decision is legal and correct. Learned Tribunal after due consideration had come to the conclusion that original decision by Government is not legal and correct. The appellants are seeking to declare the award passed by Tribunal as null and void on technical ground of delay which if declared so would result in a situation that an illegal order passed by Government would become effective. This cannot be intention of legislation and award passed by tribunal cannot be declared null and void merely because it was not passed within 30 days of reference. Same condition would have to be held directory only. Any interpretation contrary to law would only lead to perpetuation of illegality.
This cannot be intention of legislation and award passed by tribunal cannot be declared null and void merely because it was not passed within 30 days of reference. Same condition would have to be held directory only. Any interpretation contrary to law would only lead to perpetuation of illegality. (Vide AIR 1988 SC 94 and Jagan Singh v. State Transport Appellate Tribunal, AIR 1980 (Raj.) 1 (FB)) . (viii) The stipulation of time period as provided under Section 25-O(5) would have to be interpreted as only directory and not mandatory as compliance of such strict interpretation would render the section virtually ineffective and parties would be in a position to take advantage of their own misdeeds. In the instant case also the delay has essentially been on the part of appellants themselves. Learned Single Judge found the delay to be essentially on the part of appellants themselves. (ix) The legislation has cast a public duty on the Tribunal to make an award subsequent to the reference being made and after having considered the merit of the case from all aspects. Various courts consistently come to a conclusion that in cases where a public duty is directed by the statute and the performance of the same is stipulated within specified time, the provisions as to time are only directory (Vide R.V. Urbanowski (1976) 1 All ER 697 . (x) The courts while interpreting Section 17(1) of 1947 Act which make it obligatory on Government to publish an award within 30 days have come to the conclusion that same is not mandatory and an award published beyond 30 days is not invalid. A provision fixing a time within which a public officer or authority has to act in performance of a duty generally means that the statute consider it reasonable for the officer or authority within the said period. However expiry of the period confers no right and an award passed subsequently would not be held invalid on the ground of delay. The provision as to time would still be held as directory unless it is shown that the person on whom the related right is conferred is prejudiced because of the non performance of the duty within the specified time. In this case no prejudice is shown to have been caused to appellant.
The provision as to time would still be held as directory unless it is shown that the person on whom the related right is conferred is prejudiced because of the non performance of the duty within the specified time. In this case no prejudice is shown to have been caused to appellant. (Vide Remington Rand of India v. Workmen AIR 1968 SC 224 ; Maheswari v. Zila Parishad Muzaffarnagar AIR 1971 SC 1696 at 1703 ; Manjoor Khan v. State of UP AIR 1973 SC 2548 ; Dal Chand v. Municipal Corporation Bhopal, AIR 1983 SC 303 ; Kamal Leather Karamchari Sangathan v. Liberty, AIR 1990 SC 247 ; TV Usman v. Food Inspector Tellicheri Municipality, AIR 1994 SC 1818 ; Montreal Street Railway Company v. Normandin, 1917 PC 142 ; Union of India v. Rajasthan Anushakti Karamchari Union, 1977 Lab. IC (Raj.) 155) (xi) the submission of respondent as to time is not mandatory but only directory is further strengthened by the fact that legislature has not provided any consequence for the non-compliance of such provision. In construing the time of 30 days it is implied that reasonable restriction should be applied within a reasonable manner and within reasonable time. Mere provision of 30 days would not lead to an automatic conclusion that after the said period the Tribunal would become functus officio and that the reference will lapse. The only purpose behind providing the time has been that the legislation did not intend that the long term procedure should be adopted. What is referred to Tribunal is not merely the application of review alone but the whole matter in this entirety with regard to the closing down of an undertaking. Though the legislature contemplated that reference should be disposed of expeditiously, the Tribunal has to follow the principles of natural justice. It would lead to grave injustice if the same is held null and void. Vide AIR 1954 SC 210 , AIR 1985 SC 1082 , (1986) 3 SCC 83 , (1986) 1 SCC 1 . (xii) The Division Bench of Bombay High Court in Association of Engineering Workers v. Indian Hume Pipe Co. Ltd., 1986 Lab. IC 749 while dealing with Section 25-N(6) which is pari materia to Section 25-O(5) has considered the nature of the Section and held it to be directory.
(xii) The Division Bench of Bombay High Court in Association of Engineering Workers v. Indian Hume Pipe Co. Ltd., 1986 Lab. IC 749 while dealing with Section 25-N(6) which is pari materia to Section 25-O(5) has considered the nature of the Section and held it to be directory. The Hon'ble Court laid down that no proceedings before a labour Court, Tribunal or National Tribunal shall lapse merely on the ground that any period specified under this sub-section has expired without such proceedings being completed. The position is clear from the statement of objects and reasons for the Act 46 of 1982 and therefore no case will lapse merely on account of the fact that the time limit prescribed had expired. The period of 30 days was considered by the legislature as reasonable for the adjudication of the matter referred. But that does no mean that after the expiry of the said period ipso facto the reference lapses or the Tribunal becomes functus officio. Therefore requirement that the Tribunal is to pass an award within a period of 30 days from the date of reference, is directory and not mandatory and therefore on the expiry of the said time limit the reference will not lapse but will survive for adjudication. (Vide Rastriya Gypsum Mazdoor Sangh Jamsar Bikaner v. Union of India, 1986 WLN (UC) 189) (xiii) To refuse closure of unit at this belated stage would be highly unjust and such an order after 17 years of actual closure of unit would put the respondents into great hardship and the Hon'ble Supreme Court would be slow in granting such relief. (xiv) Learned Single Judge came to conclusion that there is no case of any miscarriage of justice on any of the grounds as well as on a perusal of the order of Tribunal it is seen that very reasonable and balanced view has been taken by Tribunal. Further the Single Judge found that there is no error apparent on the face of the record so as to interfere with in writ jurisdiction. A writ in the nature of certiorari may be issued only if the order of inferior Tribunal suffers from an error of jurisdiction or from the breach of principles of natural justice or vitiated by manifest or apparent error of law.
A writ in the nature of certiorari may be issued only if the order of inferior Tribunal suffers from an error of jurisdiction or from the breach of principles of natural justice or vitiated by manifest or apparent error of law. Hon'ble Supreme Court also laid down that no interference is called for in case where eventually justice has been done. Vide AIR 1990 SC 1998, AIR 1989 SC 1972 , 2001 (1) RLR 245. Conclusion : 13. The rival submissions canvassed before us have to be tested on the touchstone of Section 25-O which requires the Company if it wishes to close its establishment, to apply and satisfy the appropriate Government that the reasons given by it are genuine and adequate. The appropriate Government while considering the genuineness and adequacy of the reasons, shall have to consider public interest and other relevant factors before granting the permission to close the establishment. Section 25-O(5) : 14. The appellants have assailed the judgment of learned Single Judge on the ground that the award was not passed within 30 days of the reference as provided under Section 25-O(5) of the Act. It is not disputed that application seeking closure of STM was filed on August 9, 1984 and date of intended closure was November 9, 1984. The State Government rejected the application on October 5, 1984 and review application was filed by the Company on October 8, 1984. The order of reference was made on November 28, 1984. The management of Company filed statement of claim on December 3, 1984. All the Unions filed reply till December 18, 1984 and December 20, 1984 was fixed for filing documents and affidavits. Time for cross examination was sought by the Unions and cross examinations continued till January 17, 1985. Evidence of Unions adduced on January 23 and January 24, 1985. Arguments completed on February 2, 1985. Union (RCTU) sought time to submit financial charts. Charts were submitted till February 19, 1985 and on March 6, 1985 Tribunal passed the Award which was published on March 16, 1985. 15. Evidently the appellant Unions are also responsible for the delay in making the award and they cannot be allowed to take advantage of their own conduct.
Union (RCTU) sought time to submit financial charts. Charts were submitted till February 19, 1985 and on March 6, 1985 Tribunal passed the Award which was published on March 16, 1985. 15. Evidently the appellant Unions are also responsible for the delay in making the award and they cannot be allowed to take advantage of their own conduct. Having participated in the proceedings before the Tribunal after the expiry of 30 days without raising objection regarding the expiry of limitation, the conduct of appellant-Unions disentitles them to raise objection. Even otherwise a close look at sub-section (5) of Section 25-O goes to show that the stipulation of time period would have to be interpreted as only directory and not mandatory. (Emphasis Supplied) 16. In construing the time period of 30 days, it is implied that the reasonable restriction should be applied within a reasonable manner. It cannot inferred that after expiry of 30 days period the Tribunal would become functus officio. Prescribing the limitation of 30 days would not mean that if award is not passed during this period, the whole proceedings before the Tribunal would become void. In our opinion, procedure enumerated in sub- section (5) is designed to facilitate justice. It is not a penal enactment for punishment and penalties. It is not a thing designed to trip people up. Their Lordships of the Supreme Court in (2) S.K. Salim Haji Abdul Khayum Sab v. Kumar (2006) 1 SCC 46 while holding Order 8 Rule 1 of the Code of Civil Procedure a director, indicated as under : "All the rules of procedure are the handmaid of justice. The language employed by the draftsman of processual law may be liberal or stringent, but the fact remains that the object of prescribing procedure is to advance the cause of justice. In an adversial system, no party should ordinarily be denied the opportunity of participating in the process of justice dispensation. Unless compelled by express and specific language of the statute, the provisions of Civil Procedure Code or any other procedural enactment ought not to be construed in a manner which would leave the Court helpless no meet extraordinary situation in the ends of justice." Section 25-O(2) : 17.
Unless compelled by express and specific language of the statute, the provisions of Civil Procedure Code or any other procedural enactment ought not to be construed in a manner which would leave the Court helpless no meet extraordinary situation in the ends of justice." Section 25-O(2) : 17. Coming to sub-section (2) of Section 25-O as considered by learned Single Judge, we notice that learned Single Judge observed in the impugned judgment that the order dated October 5, 1984 of the State Government was cryptic as it did not give reasons for its conclusion and thus it was bad in law. This observation of learned Single Judge is contrary to record. As earlier noticed the order of State Government refusing permission to close STM was made after a complete inquiry held as required under Section 25-0(2) of 1947 Act. In the order details reasons and suggestions were incorporated. The State Government after hearing both the parties refused the permission for closure. It was indicated in the order that STM was amalgamated with Maharaja Shree Ummaid Mills Ltd. Co. w.e.f. January 1, 1978 for its rehabilitation, revival and to avoid unemployment of the workers due to the likely closure of that Company. Maharaja Shree Ummaid Mills Ltd and STM both were engaged in the business of textiles and thus not only similar in nature but were also inter connected. Maharaja Shree Ummaid Mills Ltd. of which STM was a unit had shown profit during the years 1982-83 and 1983-84. STM had shown profit in the year 1979 after amalgamation with Maharaja Shree Ummaid Mills Ltd. Although STM had shown losses in the year 1982-83 and 1983-84, those losses could be averted in future if adequate interest free funds for investment were made available to this unit out of the reserve of Maharaja Shree Ummaid Mills Ltd. to revive and rehabilitate this unit. The workers of this unit had given increased production during the year 1983-84, therefore the workers could in no way be blamed for the losses incurred by this unit. The management of properly streamlined and good quality of raw material was made available, there would be little possibility of the unit incurring losses in future. 18. The provisions of Section 25-O were primarily introduced by the Act 32 of 1976 w.e.f. March 5, 1976.
The management of properly streamlined and good quality of raw material was made available, there would be little possibility of the unit incurring losses in future. 18. The provisions of Section 25-O were primarily introduced by the Act 32 of 1976 w.e.f. March 5, 1976. The said amendment was struck down by the Supreme Court in the case of (3) Excel Wear [1978 (2) LLN 482]. Thereafter Act 46 of 1982 was enacted w.e.f. August 21, 1984 whereby Section 25-0 was introduced in the present form for the benefit of workmen, so that they are not rendered jobless. 19. What is the duty of the Court when it notices that ingenuity is expended to avoid welfare legislation? This question was answered by the Supreme Court in (4) Workmen of Associated Rubber Industries Ltd. Bhavnagar's case [1985 (2) LLN 8481 thus:- (Para 4) ".... It is the duty of the court, in every case where ingenuity is expended to avoid taxing and welfare legislations to get behind the smokescreen and discover the true state of affairs. The Court is not to be satisfied with form and leave well alone the substance of a transaction..." 20. In the instant matter if one goes behind the smokescreen or lift the corporate veil, there is no doubt whatsoever from the facts on record that the respondent company brought about the situation by not taking steps which a prudent management had to take to avoid closure of business. 21. A close took at the award of Tribunal demonstrates that it did not properly address itself on the question of public interest and other relevant factors. This public interest apart from other aspects, would include the interest of workmen who will be rendered jobless. Public interest also involve the moral and social responsibility of the employer to act like a prudent person before closing down the factory. In (5) Straid Products Ltd. [1986 (2) LLN 931] the Division Bench of Madhya Pradesh High Court indicated as under:- (Para 12) "....Social and moral responsibility of the applicant to exhaust all other avenues of improving the economic viability before resorting to closure/retrenchment in order to prevent unemployment of a large number of workmen...
In (5) Straid Products Ltd. [1986 (2) LLN 931] the Division Bench of Madhya Pradesh High Court indicated as under:- (Para 12) "....Social and moral responsibility of the applicant to exhaust all other avenues of improving the economic viability before resorting to closure/retrenchment in order to prevent unemployment of a large number of workmen... is a relevant factor and not an extraneous consideration in making such a decision whether in the context of closure under Section 25-O or retrenchment under Section 25-N since it relates to the factor of public interest as well as interest of the workmen as a whole..." 22. In (6) Maharaja General Kamgar Union v. Vazir Glass Works [1996 (3) LLN 747] the Division Bench of Bombay High Court considering the question as to whether the public interest and other relevant reasons would include State interest, held as under:- (Para 41) "That takes us to question whether the public, interest and other relevant reasons would include State interest. The State is very much concerned with the closure of industries as it has an adverse effect on employment potential in the State and the soundness of its economy. In fact the legislature itself has recognised this fact by calling on a company undertaking to move an application under S.25-0 of the Act to the appropriate Government. There is a purpose behind this. It is the State Government which can give concessions in the form of tax, facilities, reduction of power tariff, etc., in order to enable an industry to stand on its own feet and/or to obviate its financial and other difficulties. The State invites entrepreneurs to set up industries in backward areas of the State, provides infrastructural facilitate, give subsides, and tax concessions, etc., with a view that more and more industries will be attracted which will help the State provide employment to its residents and bring in resources to meet the expenditure on its welfare schemes for the economically backward and public at large.
It an employer who had set up an industry in a State has prospered therein afterwards because of the increase in cost of production arising out of higher wages and cost of raw material, decides to pack off and set up the same industry in some other State where he enjoys better tax benefits or facilities, benefit of low wages and other such concessions, is allowed to close down the industry without making attempts or. taking steps to overcome the difficulties the State will be faced with the situation of industries running away to States which offer more facilities as and when cost of production on account of higher wages and/or raw material goes up. In the case like the City of Mumbai where the cost of land has shot up astronomically industrialists would prefer to close down industries and make their fortune by developing the land and go to neighbouring States to set up such industries . This would lead a flight of industries which no State cane afford. Section 25-O has behind this aspect also." 23. Upshot of above discussion is that conclusion arrived at by learned Single Judge that the Tribunal took balanced view and there was no error apparent on the fact of record, does not appear to us to be correct. The reasons for closure of STM, indicated in the impugned judgment of learned Single Judge as well as in the award of Tribunal, are not genuine and adequate. The State Government made the order of refusing permission after a complete inquiry held as required under Section 25-O(2) of 1947 Act. Since details reasons and suggestions were incorporated in the order it could not be held as 'cryptic'. Learned Single Judge and the Tribunal failed to consider the order of High Court dated September 7, 1978 wherein it was stated that amalgamation of the companies was made with the object of rehabilitating and reviving of STM so that there may be no unemployment of workers and also to avoid production losses. We do not agree with the submission of learned counsel for the respondent company that to refuse closure of STM after 17 years would put the respondent into great hardship. It is unfortunate that the matter could not be decided at an early date but at the same time we cannot shut our eyes towards injustice caused to the workmen of STM. 24.
It is unfortunate that the matter could not be decided at an early date but at the same time we cannot shut our eyes towards injustice caused to the workmen of STM. 24. For these reasons we allow the appeal and set aside the Award dated March 6, 1985 of the Industrial Tribunal Kota and the judgment dated September 14, 1990 of the learned Single Judge. As a consequence whereof the order dated October 5, 1984 of the State Government is restored and closure of Sudershan Textile Mills Kota from March 6, 1985 is declared illegal and it is directed that all the workmen employed in STM on. March 6, 1985 shall be treated in the employment of STM from March 6, 1985 onwards. In the peculiar circumstances of the case we direct State Government to forthwith appoint a competent officer for framing scheme for rehabilitating and reviving of STM. There shall be no order as to costs. A copy of this order be forwarded to the Chief Secretary Government of Rajasthan.Appeal allowed. *******