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Madras High Court · body

2010 DIGILAW 5215 (MAD)

Management of Madura Coats Pvt. Ltd. and Managing Director, Madura Coats Pvt. Ltd. v. Presiding Officer, Labour Court and S. Balasubramanian

2010-11-30

K.CHANDRU

body2010
ORDER : K. Chandru, J. Three writ petitions being W.P.(MD). Nos. 10199 & 10202 of 2009 and 9765 of 2010 were filed by the Management of Madura Coats Pvt. Ltd as well as Managing Director, Madura Coats Pvt. Ltd. In these writ petitions the contesting Respondents are M/s.S. Balasubramanian, M. Alagu Selvaraj and P. Robert Thiravia Raj respectively. The very same contesting Respondents have also filed three writ petitions being W.P.(MD). Nos. 1233, 1234 & 13724 of 2010. W.P.(MD). No. 1233 of 2010 was filed by M. Alagu Selvaraj. W.P.(MD). No. 1234 of 2010 was filed by S. Balasubramanian. W.P.(MD). No. 13724 of 2010 was filed by P. Robert Thiravia Raj. For convenience, the parties are referred to as management and workman. In cases where a special reference was required the name of the individual workers are referred to in this order. 2. In all the writ petitions, the challenge is to the awards, dated 30.03.2009, passed by the Labour Court, Tirunelveli, in I.D. No. 156 of 1996 (M. Alagu Selvaraj), I.D. No. 148 of 1996 (S. Balasubramanian) and I.D. No. 147 of 1996 (P. Robert Thiravia Raj). In all the three cases separate award has been passed. 3. The writ petitions in W.P.(MD). No. 10199 & 10202 of 2009 were admitted on 09.10.2009. Pending admission, orders of interim stay were granted. W.P.(MD). No. 9765 of 2010 was admitted on 28.07.2010 and also an interim stay was granted. Subsequently, on 06.01.2010 this Court directed the Petitioner management to deposit the entire award amount to the credit of the industrial dispute with the labour Court within six months. Thereafter, this Court modified the said order on 26.02.2010. In respect of W.P.(MD). No. 10199 of 2009, the Court held that the management should deposit Rs. 4,00,000/- to the labour Court and the labour Court in turn was directed to invest the amount in a nationalised bank for a period of two years with liberty to the worker to withdraw the interest quarterly. In respect of W.P.(MD). No. 10202 of 2009, the interim order was modified with a direction to deposit Rs. 6,00,000/- with the labour Court, which in turn was directed to invest the same in any one of the nationalised bank for a period of two years with liberty to the worker to withdraw the quarterly interest. In W.P.(MD). In respect of W.P.(MD). No. 10202 of 2009, the interim order was modified with a direction to deposit Rs. 6,00,000/- with the labour Court, which in turn was directed to invest the same in any one of the nationalised bank for a period of two years with liberty to the worker to withdraw the quarterly interest. In W.P.(MD). No. 9765 of 2010, the interim stay order still continues without further orders. 4. It is now stated that the management have filed writ appeals against the interim orders passed by this Court and the same are pending. However, without waiting for the outcome, both sides expressed readiness to get on with the main writ petitions. By the consent of both sides, they were heard together. In view of the common questions raised, they were clubbed together and a common order is passed. 5. The facts leading to the raising of the Industrial Dispute by all the three workers are almost identical. All the three workmen after having joined the services of the management, were promoted as Sub-Managers and posted to work at Thuthukudi Mill. The Workmen belong to sub management cadre and governed by separate terms and conditions and the services of such sub managers are governed by special terms and conditions of service which they have accepted. As per the terms and conditions, for termination of service of a Sub-Manager, three month's notice or payment of salary in lieu of notice thereof can be given. The workers are not "workmen" coming within the meaning of Section 2(s) of the Industrial Disputes Act, 1947. 6. It is the case of the management that the workmen submitted their resignations on 17.03.1995 and requested to relieve them with immediate effect. The management waiving the three months' notice, as per the term of contract, relieved them from their services and also paid their terminal dues including ex-gratia compensation as well as provident fund. They also submitted that all the other Sub-Managerial cadre working in the mills have resigned and settled their claims except the three workers herein. All the other 250 workers were relieved on 17.03.1995. 7. The contention of the workmen was that relieving them from service was due to coercion. They were threatened, forced in doing so and it was contrary to law. On plain papers, their resignations were obtained. All the other 250 workers were relieved on 17.03.1995. 7. The contention of the workmen was that relieving them from service was due to coercion. They were threatened, forced in doing so and it was contrary to law. On plain papers, their resignations were obtained. Labelling the said termination, they have raised Industrial disputes before the Labour Officer, Thuthokudi, alleging that their non-employment was illegal. Despite summons issued by the conciliation officer, none of the representative of the management had appeared, which resulted in a failure report dated 09.07.1996, furnished by the conciliation officer. On the strength of the failure reports, the workmen have filed claim statements before the labour court. Those claim statement were taken on file as I.D. Nos. 156, 148 and 147 of 1996 and notices were ordered to the management. The management filed their counter statements in all the three industrial disputes. 8. The contention of the management was that the workers were not the 'workmen' within the meaning of 2(s) of the Industrial Disputes Act and inasmuch as they belong to the Sub-Management cadre and they are mainly engaged in a work of supervisory cum managerial drawing wages exceeding 1,600/- per month. Therefore, the Industrial Dispute is not maintainable. Secondly it was contended having given a voluntarily resignation, no dispute can be raised u/s 2-A of the Industrial Disputes Act. The said provision is available only in case of termination by the management and not in case of voluntary resignation by the workmen. The management also disputed the charges levelled by them and that there was no coercion and threat. It pointed out that almost all the 250 of the Sub-Managerial cadre have resigned and taken away the terminal benefits including the Ex-gratia payment. The Petitioners have come up with a new case. It was contended that the there was no termination and the Industrial Dispute is not maintainable. Further the management has a right to re-organise its work force. Therefore due to reorganisation, those Sub-Managers posts have become surplus. Having found no avenue of further employment, they have resigned on their own volition and left the services. 9. In I.D. No. 156 of 1996 (M. Alagu Selvaraj/W.P.(MD). No. 1233 of 2010) on behalf of the worker 19 documents were filed and marked as Ex.W1 to Ex.W19. The worker had examined himself as WW1. Having found no avenue of further employment, they have resigned on their own volition and left the services. 9. In I.D. No. 156 of 1996 (M. Alagu Selvaraj/W.P.(MD). No. 1233 of 2010) on behalf of the worker 19 documents were filed and marked as Ex.W1 to Ex.W19. The worker had examined himself as WW1. On the side of the management 41 documents were filed and marked as Ex.M1 to Ex.M41. Two witnesses were examined i.e. M/s. S. Sivasubramanian and Samuel Arul Prakash as MW1 and MW2. 10. Similarly in I.D. No. 148 of 1996 (S. Balasubramanian/W.P.(MD). No. 1234 of 2010) on behalf of the worker 105 documents were filed and marked as Ex.W1 to Ex.W105. The worker had examined himself as WW1. On the side of the Management 41 documents were filed and marked as Ex.M1 to Ex.M41. One A. Somasundaram was examined as MW1. Three documents were marked as Court documents as Ex.C1 to Ex.C3. 11. Likewise in I.D. No. 147 of 1996 (P. Robert Thiraviaraj/W.P.(MD). No. 13724 of 2010) on behalf of the worker 44 documents were filed and marked as Ex.W1 to Ex.W44. The worker had examined himself as WW1. On the side of the management 37 documents were filed and marked as Ex.1 to Ex.37. Two persons i.e. M/s.K. Inbaraj and Somasundaram were examined as MW1 and MW2. Pay slips relating to March'95 was marked as Court Exhibit 1. 12. The labour Court based on these materials both oral and documents, came to the conclusion that they were only labelled as Sub Managers and they are covering under the provisions of the Industrial Disputes Act. Their resignations are involuntary. Accepting their resignation and waiving the notice period was not contemplated. The workmen had right to withdraw their resignations during the notice period. They were obtained due to coercion and threat. Therefore, the resignation taken from them on 17.03.1995 was illegal. After holding that the resignation was illegal, the labour Court found that in view of forced resignation, the dispute raise by them u/s 2-A of the Industrial Disputes Act, 1947 is maintainable. The Labour Court had also held that the workmen are not entitled to get reinstatement in service. On the other hand they are entitled to get lumpsum payment of wages. 13. In the case of T. Alagu Selvaraj, the Court granted a compensation of Rs. 14,46,546.60 paise. The Labour Court had also held that the workmen are not entitled to get reinstatement in service. On the other hand they are entitled to get lumpsum payment of wages. 13. In the case of T. Alagu Selvaraj, the Court granted a compensation of Rs. 14,46,546.60 paise. In the case of S. Balasubramanian, the Court granted a compensation of Rs. 7,34,998/- together with interest at the rate of 6%, this was on the plea that he was a qualified advocate and he would have been gainfully employed during the relevant time. In the case of P. Robert ThiraviaRaj, the Court granted a compensation of Rs. 8,26,363/- together with 6% interest. Aggrieved by the lumpsum compensation, the management have filed three writ petitions numbering W.P.(MD). Nos. 10199 & 10202 of 2009 and 9765 of 2010 and aggrieved by the denial of full wages, the workmen have filed the other three petitions being W.P.(MD). Nos. 1233, 1234 and 13724 of 2010 as noted already. 14. Heard Mr. V. Karthik, learned Counsel appearing for the management and Mr. V. Ramajagadeesan assisted by Mr. D. Srinivasaragavan appearing for the workers. 15. Elaborate arguments were advanced on the question of maintainability of the Industrial Disputes both on the ground that "workmen" were not covered u/s 2(s) of the Industrial Disputes Act, 1947 inasmuch as they were engaged in a managerial capacity or in a supervisory capacity drawing a salary exceeding Rs. 1,600/- per month as well as on the ground in case of voluntary resignation, Section 2-A was not attracted. 16. In respect of an identical case arising out of the awards passed by the Labour Court, Madurai in I.D. Nos. 20 and 19 of 1996, the Labour Court took the view that they are not workmen and they are Sub-Managers working and their services are covered by separate terms and conditions and dismissed the Industrial dispute by a common award dated 01.03.2001. Aggrieved workmen filed two writ petitions before this Court in W.P.(MD). Nos. 11632 and 11633 of 2001. The two writ petitions were came to be dismissed by a common order dated 24.03.2010 and the awards of the labour Court were confirmed. 17. In paragraphs 4 to 10 it was observed as follows; 4. In this context, the second Respondent/Management placed before the Labour Court the list of duties entrusted to the supervisor staff like the Petitioners, who are in the Sub-Manager category. 17. In paragraphs 4 to 10 it was observed as follows; 4. In this context, the second Respondent/Management placed before the Labour Court the list of duties entrusted to the supervisor staff like the Petitioners, who are in the Sub-Manager category. They also filed number of documents in which the Petitioners have signed as Shift In-charge or Department Officer. Some of the documents included a memo issued to workman and fine imposed on such workmen. 5. In the list of the duties given to the Petitioners, it was also brought on record that it included taking attendance of the workers; making a requisition to other departments to send workers to his department, if there was a shortage of attendance; to take decision regarding running or stoppage of the machines; in case they worked in the second or third shifts, they are Shift in-charge in full control of men and material and had a duty to ensure targeted production during those shifts; they have also power to issue charge memo to the workers in case of absence or committing mistakes; they are empowered to levy fine on the workers under them; they are also entitled to issue charge memo if sub-standard products were manufactured by the workmen; they have power to supervise the work of the workmen regarding the quality and nature of work and also grant leave to the workmen working under them, including determining the overtime allowance payable. When these facts were brought on record, the two Petitioners attempted to submit that what they have signed is only a printed form and in effect, it is only the management which will have to take action. 6. In cross-examination, the Petitioners have admitted that they have been paid only staff dearness allowance and not industrial dearness allowance, and they never questioned the non-payment of industrial dearness allowance which is paid to other workers. They also admitted that whenever any wage settlements are signed or covered by award, they were not given the benefit as they were categorized as Sub-Managers and separate service Rules have been provided for them. 7. Though in the cross-examination one of the Petitioners stated that he did not sanction any leave, the question is not whether to actually sanctioned leave or not. 7. Though in the cross-examination one of the Petitioners stated that he did not sanction any leave, the question is not whether to actually sanctioned leave or not. If the list of duties produced by the second Respondent/management which are performed by the supervisory staff like the Petitioners is taken into account, the fact that they did not exercise the power actually will not make them less supervisory. On the other hand, the Labour court, on appreciation of the materials placed before it, recorded the following findings in the impugned award. 8. After listing out the nature of duties as stated above, a portion from the cross-examination of the Petitioners was also recorded wherein they have admitted that if the workmen were absent they gave memos and they have also signed. It was also recorded that the Petitioners imposed fine on the workmen and in the order of penalty they have signed above the place where it is marked as "Department Officer". 9. In the cross-examination, the Petitioners have also admitted that they did not get industrial dearness allowance and the house rent allowance paid to the workers and that the interim relief granted pursuant to the wage revision was also not given to them. It is in this view of the matter, the Labour Court held that they are not workmen within the meaning of Section 2(s) of the Act. The Labour Court also placed reliance upon the judgments of the Supreme Court in Burmah Shell Oil Storage and Distribution Co. v. the Burmah Shell Management Staff Association 1970 I LLJ 590 and All India Reserve Bank Employees Association Vs. Reserve Bank of India, AIR 1966 SC 305 . 10. Though an attempt was made by the Petitioners to submit that it is not the designation which mattered, but it is only the nature of duties and when the Petitioners did not perform the duties attached to supervisory staff, they cannot be labelled as non-workmen relying upon the decision of the Division Bench of this Court in Engineering Construction Corporation Ltd. Vs. Additional Labour Court and Others, (1980) 2 LLJ 16 , the said judgment was distinguished by the Labour Court on the ground that in that case the Foreman (Carpantry) was doing physical work and not supervising over other carpenters. It is in that view of the matter the Labour Court rejected the cse of the Petitioners. Additional Labour Court and Others, (1980) 2 LLJ 16 , the said judgment was distinguished by the Labour Court on the ground that in that case the Foreman (Carpantry) was doing physical work and not supervising over other carpenters. It is in that view of the matter the Labour Court rejected the cse of the Petitioners. On the strength of the same, the learned Counsel prayed for setting aside the awards of the labour Court. 18. Elaborate arguments were also advanced by drawing the attention of this Court through the evidence recorded on both sides. The counsel for the workmen also submitted that initially the question whether the workmen comes within the meaning of Section 2(s) of the Industrial Disputes Act, is a question of fact and in the present case, the labour Court on the material placed had come to the conclusion that they are workmen and therefore, the same finding should not be disturbed. But, since this Court had already upheld an award holding the Sub Managers working under a separate contract of employment in the very same mill arising out of the same episode, it had no option except to set aside the impugned awards on the ground that they are not maintainable and the workmen are not workmen within the meaning of Section 2(s) of the Industrial Disputes Act. 19. There is yet another ground which the Petitioner cannot get away. That is the ground regarding the maintainability of the dispute u/s 2-A of the Industrial Disputes Act. Unless there is proof regarding a resignation has obtained under coercion, a dispute is not maintainable. Only when a resignation was obtained under coercion and threat, an industrial dispute is maintainable. If there has been a forced resignation, then any action there of will amount to an illegal termination of service of the workman. It has to be seen whether the workmen acquitted themselves on this issue before the labour Court. 20. In the proof affidavit filed by one C. Balasubramanian, the worker in I.D. No. 148 of 1996, it was the statement of the worker that after the first shift on 17.03.1995 he was called by the Spinning and Twisting Manager to attend the office of Mill Manager. The worker went to the office of S.V. Natarajan, Mill Manager. In that room there persons namely S.V. Natarajan, S. Deivanayagam, Manufacturing Manager and Vittal Thiragarajan were present. The worker went to the office of S.V. Natarajan, Mill Manager. In that room there persons namely S.V. Natarajan, S. Deivanayagam, Manufacturing Manager and Vittal Thiragarajan were present. They told him that the financial position of the mill was critical and they decided to retrench the staff to the extent of 1/3rd of technical staff. When the workman asked the reasons for the same, they replied that he was not the one to question the same. The workman told that juniors are continuing in service and he should not be terminated. The management told him that they are adopting "Hire and Fire Policy" and can do pick and choose methods. When the workman pleaded about his remaining 14 years of service. He was told by the persons in the room that he should do what they are dictating to him. They wanted him to put his signatures on paper, which already had typed matters on it. When he refused, they told that if he does not sign, he will be dismissed and he will not get even a single paisa. When he further refused, he was told that without signing, he cannot go out of the cabin. He was also abused by dragging the names of his parents. When he tried to escape, two persons were made to wait outside the cabin. 21. As he was tired after the day shift without any further option open to him, due to tension and pressure, he signed on typed papers without reading its contents. They had also told him to take their dictation on a white paper. As per the dictation he signed the resignation letter. Apart from that, on certain typed and blank sheets as well as printed sheets they had obtained his signatures by force. In cross-examination he stated that he was paid a cheque of Rs. 93,210/- and he received a cheque. He claimed that the same was received under objection. He also admitted that there was reduction of work force in the Madura Coats Limited to the extent of 550 persons and in that there were technical staff of 170 persons as per Ex.M35 and Ex.M36. 22. The labour Court on the basis of all these material held that Ex.M41 resignation letter was only a copy and the original was not produced, despite the application was filed for production. 22. The labour Court on the basis of all these material held that Ex.M41 resignation letter was only a copy and the original was not produced, despite the application was filed for production. It also held that three months' notice was mandatory and the management cannot waive the notice period. Hence the order was obtained by fraud, coercion and threat. Subsequently, a complaint was given to the Police Station Ex.W.18 on 18.03.1995. It held that for a paltry sum of Rs. 93,210/- he would not have signed a resignation letter. Therefore, the labour Court held that all the 250 persons from whom resignations were obtained in Thoothukudi unit was as per prior plan. In Ex.42, there was no two addresses. The workman's name and ticked number have not been mentioned. It also held notice period for the resignation cannot be waived. There was no prayer to settle the dues of the workman in that order. The mill manager's signature and the worker's signature were not found. Since the signatures were not voluntary, the dispute is not maintainable. 23. Thereafter, the labour Court referred to the judgments arising out of the Government servants covered under Article 311 and held that notice period cannot be waived and during the notice period a resignation can be withdrawn and the resignation letter itself there was no endorsement regarding the waiver of notice. It is in this context the labour Court held that in case of involuntary resignation a dispute u/s 2-A of the Industrial Dispute Act, is maintainable as it would amount to having been otherwise terminated as found u/s 2-A of the Industrial Disputes Act. 24. Assailing these awards it was contended by the management that having obtained the Ex-gratia payments, the workmen cannot allege threat, fraud or coercion. It was also stated that when 250 employees and out of which 29 of them in Thoothukudi Unit itself, have given resignation letters realising the financial position of the Mill and also the legal right of such persons, only the three Petitioners have raised disputes alleging all kinds of allegations against the employer. In their cross-examinations they have admitted that they have received all the terminal benefits. Therefore, they are estopped from contending that the resignation was forced out of them. The evidence let in by them before the labour Court did not prove that there was coercion or threat. In their cross-examinations they have admitted that they have received all the terminal benefits. Therefore, they are estopped from contending that the resignation was forced out of them. The evidence let in by them before the labour Court did not prove that there was coercion or threat. On the other hand, each one of them have admitted that they have written the resignation letters in their own handwriting. Though the workers have alleged several other signatures have obtained, they all related to various settlement dues which required statutory forms to be filled up. Apart from the legal dues, the Petitioners were also paid extra amounts. Therefore, it cannot be said that the resignation was forced out by them. 25. Therefore, in the context of the above rival contentions, this Court will have to decide whether the workers have sufficiently established before the labour court that there was forcible resignations, wherein and by which it can be deemed that it was also a termination at the instance of the management, further relief can be determined on the premise that there were illegal terminations. The labour Court in the present case, went at a tangent and held that the contract provides for three months notice and therefore, the management has no power to waive the notice period. The labour Court also held that once there is notice period stipulated, it is open to the workmen who have tendered the resignation to withdraw it before the notice period. The management cannot accept the resignations before the expiry of the notice period and there was no endorsement in the resignation letter that the notice period was waived by the management. 26. First of all there is no attack against the management creating Sub-Managerial cadre governed by separate terms and conditions of the contract, called as Pink book. The fact that the workmen, have accepted to work as Sub-Managers and governed by different terms and conditions including different Dearness Allowance, Medical Reimbursement, wage pattern etc., cannot now allege that such an arrangement was invalid. At that time, when they accepted the status of Sub-Managers they were fully aware of their terms and service conditions including the security of their tenure. Therefore, that cannot be challenged at this juncture. At that time, when they accepted the status of Sub-Managers they were fully aware of their terms and service conditions including the security of their tenure. Therefore, that cannot be challenged at this juncture. Therefore, when after coming to know about the financial position of the company, they had agreed to tender resignations and settled their accounts including receipt of Ex-gratia payments. Such an exercise cannot be said to have been done through coercion or threat. The present workers received the payment and also encashed the same. Thereafter, it cannot be contended that their resignations were forced out of them. The finding of the labour Court that for paltry amounts, the workers would not have resigned, is to say least is an unwarranted finding in the facts and circumstances of the case. 27. The Supreme Court while considering the effect of resignation in J.K. Cotton Spinning and Weaving Mills Company Ltd. Vs. State of U.P. and Others, (1990) 4 SCC 27 , in paragraph 8 had observed as follows; We are, therefore, of the opinion that such a situation would be covered by the expression 'voluntary retirement' within the meaning of Cl.(i) of Section 2(s) of the State Act. In Santosh Gupta Vs. State Bank of Patiala, (1980) 3 SCC 340 , Chinnappa Reddy, J. observed as under at p.1220 of AIR: Voluntary retrenchment of a workman or the retrenchment of the workman on reaching the age of superannuation can hardly be described as termination, by the employer, of the service of a Workman. (Here the word 'retrenchment' has reference to 'retirement'.) The above observation clearly supports the view which commends to us. 28. Subsequently, a Division Bench of this Court in Jayakodi Jacob D. Vs. Presiding Officer, Labour Court and Another, (1999) 1 LLJ 1025 , held that if a person retires voluntarily and got all the benefits flowing from the scheme without any protest, reservation or demur, cannot be equated with an employee whose resignation is governed by the statute or such resignations are to be accepted in a particular way as prescribed by the statute. It has observed in paragraph 5 as follows; The learned Judge again observed that the option given by the Appellant for taking voluntary retirement cannot be equated to resignation in respect of an employee governed by the statute or such resignation is to be accepted in a particular way as prescribed by the statute. The Labour Court as well as the learned single Judge, on the basis of the materials, have concluded looking to the Voluntary Retirement Scheme and the conduct of the parties that the Appellant had voluntarily retired and got all the benefits flowing from such a Scheme. The events stated above by us, while narrating the facts, clearly indicate that the Appellant pursuant to the Voluntary Retirement Scheme exercised option to take voluntary retirement; nothing more was required to be done by the Management or by him so as to give benefits flowing from that scheme; the Appellant received V.R.S. compensation of Rs. 50,000/- on August 19, 1987 without any protest, reservation or demur.... The Appellant even received the gratuity amount. To explain these circumstances, learned Counsel only submitted that the Appellant was put in difficult situation and he was under the forced circumstances and to survive, he accepted the V.R.S. compensation. We are not impressed by that submission. 29. If it is seen in the above angle, the contentions raised by the workmen cannot be countenanced by this Court. The labour Court thoroughly misdirected itself in holding that the resignation was forced out of them and hence, they are entitled to relief and it has quantified the relief. 30. In view of the above finding that the workmen are not workmen within the meaning of 2(s) of the Industrial Disputes Act and the case of the workmen that it was a fraud resignation was not believed, they are not eligible to move the labour Court u/s 2-A of the Industrial Disputes Act. In view of these findings it is unnecessary to go into the other facts relating to the quantum of relief. It is suffice all the disputes have to be dismissed. 31. Consequently, three writ petitions being W.P.(MD). Nos. 10199 & 10202 of 2009 and 9765 of 2010 filed by the management are allowed and the award of the labour Court passed in I.D. Nos. 156, 148 and 147 of 1996, dated 30.03.2009 are set aside. Consequently, three petitions filed by the workers in W.P.(MD). 31. Consequently, three writ petitions being W.P.(MD). Nos. 10199 & 10202 of 2009 and 9765 of 2010 filed by the management are allowed and the award of the labour Court passed in I.D. Nos. 156, 148 and 147 of 1996, dated 30.03.2009 are set aside. Consequently, three petitions filed by the workers in W.P.(MD). Nos. 1233, 1234 and 13724 of 2010 will stand dismissed. The connected miscellaneous petitions are closed. No costs.