Case: Rashtriya Sut Girni Mazdoor Sangh Through Its General Secretary Vs. S Government of Maharashtra,Ministry of Law and Judiciary

R.M. LODHA, J.( 1 ) THESE two writ petitions pertain to the jurisdiction of the learned Single Judge under the Bombay High Court, Appellate Side Rules, 1960. As the learned Single Judge could not take up these matters because of heavy board, the Apex Court, in Civil Appeal Nos. 6617-6618 of 1999, requested Honble the Chief Justice to assign the writ petitions to appropriate Division Bench for being decided at the earliest and that is how these matters have come up before us. ( 2 ) RASHTRIYA Sut Girni Mazdoor Sangh, a Union registered under the Trade Unions Act, 1926 and also recognised as a representative Union under the provisions of the Bombay Industrial Relations Act, 1946 for the local area of Amravati Taluka in which respondent No. 6 is located ( for short, "the Union", is the petitioner in writ petition No. 1335 of 1997. In the other writ petition, namely Writ Petition No. 1402 of 1997, the Maharashtra State Textile Corporation Limited, a Government Company, (for short, "the Corporation"), in whom M/s. Vijay Mills has been vested, is the petitioner. The union in Writ Petition No. 1335 of 1997 filed by it, has prayed for appropriate writ, order or direction for quashing and setting aside the notice of closure dated 7-2-1997, the decision of the State Government dated 3-2-1997 and the entire proceedings initiated in pursuance of notice of closure dated 7-2-1997 before the Commissioner of Labour, Mumbai. The Corporation is aggrieved by the order dated 2-5-1997 passed by the Commissioner of Labour, Mumbai, to the extent the application of closure made by it has been rejected. The subject matter in both these writ petitions being similar, they are heard together and disposed of by this common judgment. ( 3 ) THE controversy raised in these two writ petitions arises from the facts and circumstances, which we summarize hereunder: vijay Mills, Badnera, ceased production and went in liquidation in the month of February, 1969. This Court passed winding up order in respect of the said Vijay Mills in the month of September, 1973 (for the sake of brevity, we shall refer to Vijay Mills hereinafter as "the Mill" ). The said Mill was taken over by the Government of India in the month of November, 1974 under section 18-FA (2) of the Industries (Development and Regulation) Act, 1951 at the instance of the Government of Maharashtra. The Government of Maharashtra, in exercise of the powers conferred on it under section 3, Clause (iv) of sub-section (1) of section 4 of the Bombay Relief Undertakings (Special Provisions) Act, 1958, declared by its Notification dated 28-1-1975, the Mill as "relief Undertaking" for a period of one year with effect from 29-1-1975. After expiry of one year from 29-1-1975, every year thereafter, similar notification was issued and the Mill continued to be conducted as "relief Undertaking" till 24-8-1982. The Government of Maharashtra on 24-8-1982 promulgated the Maharashtra Textile Companies (Acquisition and Transfer of Undertakings) Ordinance, 1982 nationalising the said Mill. Thereafter the Maharashtra Textile Companies (Acquisition and Transfer of Undertakings) Ordinance, 1982 was promulgated, which provided for acquisition and transfer of rights of the said Mill. An intervening fact may be noticed here that on 5-4-1975, a notice was published by the Mill about basic salary payable as per Mangalmurthy Award, but it was declared that the dearness allowance would be only one-third thereof. On 16-11-1987, the Union filed Writ Petition No. 2453 of 1987 before this Court praying (i) quashing of Notification issued under the Bombay Relief Undertakings (Special Provisions) Act, 1958; (ii) stay of Notification dated 27-2-1987 and direction to pay the dearness allowance as per Mangalmurthy Award and (iii) direction to respondents to run the Mill so as to subserve the objects and purposes of the Nationalisation Act of 1982. The said writ petition is pending before this Court. On 16-1-1993, the Corporation made an application under section 25-M of the Industrial Disputes Act, 1947 seeking permission to lay-off workmen, but the said application was later on withdrawn. It is the case of the Union that since 1974 till January 1990, the workers sacrificed wages to the extent of 45 percent because of illegal application of the Bombay Relief Undertakings (Special Provisions) Act, 1958 in the expectation that the State Government would rehabilitate the Mill. In the month of February, 1993, the Corporation sold the old machinery to Japanese firm for Rs. 67 lakhs. Apprehending trouble from the Union in that regard, the Management filed complaint under the Maharashtra Recognition of Trade Unions and Prevention of Unfair Labour Practices Act, 1971 before the Industrial Court seeking direction that the workers/recognised Union should not oppose removal of old machinery from the Mill premises. The Industrial Court on 4-3-1993 passed an order allowing the Corporation to remove the said machinery after recording its undertaking that the amount of Rs. 67 lakhs realised from the sale of old machinery would be utilised for rehabilitation of the Mill. On 24-12-1996, the Cabinet of the State Government took decision to close the Mill and that the employees/workers in the said Mill should be given voluntary retirement. In the communication dated 3-2-1997 sent by the State Government to the Managing Director of the Corporation, the decision taken in the Cabinet meeting held on 24-2-1996 was conveyed. Thereafter on 7-2-1997, the Corporation made on application under sub-section (1) of section 25-O of the Act of 1947 to the Commissioner of Labour, Mumbai, seeking permission to close the Mill for the reasons assigned in the Annexure annexed to the application. It appears that the Commissioner of Labour issued notice on 13-2-1997 and fixed 28-2-1997 as the next date. The Union filed its objections before the Commissioner of Labour on 28-2-1997. The Corporation filed its reply to the objections made by the Union on 20-3-1997. The Corporation also made an application to the Commissioner of Labour on 20-3-1997 for issuance of notice to the Government of Maharashtra and also for sending the detailed copy of the reply filed by the Union to the Government. The Commissioner of Labour on 7-4-1997 sought further information from the Corporation and on 2-5-1997 rejected the application made by the Corporation under section 25-O of the Act of 1947 on the ground that Writ Petition No. 2453 of 1987 is pending before the High Court, though the Commissioner of Labour held that the application made by the Corporation for closing down the Mill appears to be genuine and reasonable. ( 4 ) AS indicated above, the Union is aggrieved by the proceedings initiated by the Corporation under section 25-O of the Act of 1947, while the Corporation is challenging the legality and correctness of the order dated 2-5-1997 rejecting the application made by it. ( 5 ) KEEPING in view the observations made by the Apex Court for expeditious hearing of these two writ petitions, we accorded priority to these two writ petitions and heard Shri S. D. Thakur, the learned Counsel appearing for the Union and Shri K. H. Deshpande, the learned Senior Counsel appearing for the Corporation, at quite some length. ( 6 ) SHRI Thakur, the learned Counsel appearing for the Union, strenuously urged that the action of the Corporation seeking to move application under section 25-O of the Act of 1947 is contrary to the Cabinet decision dated 24-12-1996. He urged that the Cabinet had not taken a decision for closure of the Mill under section 25-O, but the decision was taken to give voluntary retirement to all employees and then the Mill may be closed. In other words, the submission of the learned Counsel for the Union is that the application made by the Corporation under section 25-O is without authority and beyond the scope of Cabinet decision dated 24-12-1996. The learned Counsel for the Union urged that even otherwise, the action of the Corporation in moving the application under section 25-O of the Act of 1947 is unsustainable and bad in law, since it is contrary to Nationalisation Act of 1982. Elaborating his contentions, Shri Thakur submitted that the Mill was closed in the year 1969 and remained closed thereafter for about five years and was in liquidation. In September, 1973, this Court had already passed an order directing winding up of the Mill. At that time, the machinery had become old, imbalanced and insufficient to keep up the desired activity level and employment potential and since the Government of Maharashtra made commitment to the Government of India to assume full financial responsibility in running the Mill, the Government of India took over the Mill in November, 1974 under section 18-FA (2) of the Industries (Development and Regulation) Act, 1951. Taking due note of these facts, the legislature nationalised the Mill on 24-8-1982 with a twin object of (i) reviving the Mill as a viable unit, and (ii) protecting the employment. In the backdrop of these facts, Shri Thakur argued that since the Nationalisation Act of 1982 has not been repealed so far and that the said Act of 1982 does not make any provision for closing down the Mill, the State Government had no power to close the Mill. In support of his contention that since the Nationalisation Act of 1982 is holding the field, an executive decision could not have been taken contrary and counter to the Nationalisation Act of 1982 being violative of Article 162 of the Constitution of India, Shri Thakur relied upon the judgments of the Apex Court in (State of A. P. v. L. Narendra Nath), A. I. R. 1971 S. C. 2560, (State of M. P. v. Thakur Bharat Singh), A. I. R. 1967 S. C. 1170, (B. N. Nagarajan v. State of Mysore), A. I. R. 1966 S. C. 1942, (R. Chitralekha v. State of Mysore), A. I. R. 1964 S. C. 1823, (M/s. Bishamber Dayal Chandra Mohan v. State of U. P.), A. I. R. 1982 S. C. 33, and (State of U. P. v. Hindustan Aluminium Corporation), 1979 (3) S. C. C. 229. The learned Counsel for the Union also contended that the action of the Corporation in moving the application under section 25-0 of the Act of 1947 is an infringement of Articles 14 and 21 of the Constitution of India. In the light of the objects and reasons of the Industries (Development and Regulation) Act, 1951, the provisions of the Bombay Relief Undertakings (Special Provisions) Act, 1958 and the statement and other provisions of the Nationalisation Act of 1982, inasmuch as the specific and dominant purpose for nationalisation of the Mill was to protect the employment, the submission of Shri Thakur is that the means of livelihood having been protected under the various statutory provisions, could not have been taken away by the executive action seeking closure of the Mill without there being any provision for the same under the Nationalisation Act of 1982. To buttress this submission, Shri Thakur relied upon the decisions of the Apex Court in (Olga Tellis v. Bombay Municipal Corporation), 1985 (2) Bom. C. R. 434 : 1985 (3) S. C. C. 545, (The Delhi Transport Corporation v. DTC Mazdoor Congress), 1991 Supp (1) S. C. C. 600, and (Air India Statutory Corporation v. United Labour Union), A. I. R. 1997 S. C. 645. Lastly, Shri Thakur submitted that the delegation of power by the State Government to the Commissioner of Labour under section 39 of the Act of 1947 is bad in law and is also actuated with malice. ( 7 ) ON the other hand, Shri Deshpande, the learned Senior Counsel appearing for the Corporation, urged that the Maharashtra Textile Companies (Acquisition and Transfer of Undertakings) Act, 1982 is not the Nationalisation Act, as contended by the learned Counsel for the Union, but was in fact the Act for acquisition of the Mill. He submitted that the provisions of the Act of 1982 do not show that the Legislature intended that the Mill should be asked to run perpetually. The learned Senior Counsel contended that the entire Act of 1982 does not prohibit closure of the Mill. Rather he submitted that section 10 of the Act of 1982 leaves no manner of doubt that the employees of the Mill, who were in employment prior to the "appointed day" of the Act of 1982, shall continue in employment unless and until their employment in the Corporation is duly terminated or until their remuneration and other conditions of service are altered by the Corporation. Relying on section 10 of the Act of 1982, Shri Deshpande thus submitted that if the services of the employees could be terminated in accordance with law, the Mill could also be closed down by following the due procedure prescribed under the Act of 1947. Shri Deshpande submitted that the statement of reasons accompanying the Act is not the enacted part of the legislation and, therefore, the statement of reasons can be considered only if there is any ambiguity in the provisions of the Statute. In this connection, he relied upon the judgment of the Apex Court in (M/s. Burrakur Coal Co. v. Union of India), A. I. R. 1961 S. C. 954 and (State of Rajasthan v. Leela), A. I. R. 1965 S. C. 1296. He also urged that even if the said statement of reasons is read, it does not show that it was the intention of the Legislature that the need for such continued production of goods would remain for all the time to come and there would be no closure. The learned Senior Counsel thus submitted that the Government decision having been taken for the closure of the Mill, it was open to the Corporation to make an application for closure for genuine and adequate reasons and the contention of the learned Counsel for the Union that the Corporation could not have made an application under section 25-O of the Act of 1947 for closure of the Mill, is misplaced. The learned Senior Counsel appearing for the Corporation, relying upon the judgment of the Apex Court in (Workmen of Meenakshi Mills Limited v. Meenakshi Mills Limited), 1992 (3) S. C. C 336, submitted that no fault can be found in delegation of power by the appropriate Government to the Commissioner of Labour under section 39 of the Act of 1947. Shri Deshpande also relied upon the judgment of the Apex Court in (Dayakar Reddy v. MD, Allwyn Auto Limited), 2000 (9) S. C. C. 247, and urged that the decision of the Apex Court in Dayakar Reddys case is a complete answer to the contention of the learned Counsel for the Union that after the decision taken by the State Government to effect closure, the proceedings under section 25-0 of the Act of 1947 were an empty formality. Challenging the order passed by the Commissioner of Labour on 2-5-1997 rejecting the Corporations application under section 25-O of the Act of 1947, the learned Senior Counsel appearing for the Corporation vehemently argued that once the Commissioner of Labour recorded a finding that the reasons given in the application for closure are genuine and adequate, he was not justified in rejecting the said application on the ground of pendency of Writ Petition No. 2453 of 1987. Shri Deshpande also contended that under sub-section (3) of section 25-O of the Act of 1947, the application made by the Corporation for closure would be deemed to be allowed on expiry of sixty days from the date of application dated 7-2-1997, since no decision was taken by the Commissioner of Labour before expiry of sixty days. ( 8 ) THERE is no dispute that the Mill ceased production and went in liquidation in the month of February, 1969 and this Court passed winding up order in the month of September, 1973 in respect of the said Mill. There is also no dispute that in the month of February, 1974, the Mill was taken over by the Government of India at the instance of the Government of Maharashtra under section 18-FA (2) of the Industries (Development and Regulation) Act, 1951, and that the Government of Maharashtra exercised the powers conferred on it under the Bombay Relief Undertakings (Special Provisions) Act, 1958 and declared by its Notification dated 28-1-1975 the Mill as "relief Undertaking" and similar Notifications were issued from time to time till 24-8-1982, when the Government of Maharashtra promulgated the Ordinance, which later on became the Act vide Maharashtra Act No. XXXIII of 1982. At this stage, it would be appropriate to refer to the aims and objects of the Act and the relevant provisions, upon which heavy reliance was placed by the learned Counsel appearing for the parties. The relevant portion of Maharashtra Act No. XXXIII of 1982 reads thus:Maharashtra Act No. XXXIII of 1982 (First published, after having received the assent of the President in the "maharashtra Government Gazette" on the 14th October, 1982.)An Act to provide for the acquisition of undertakings of two textile companies for the purpose of ensuring continued and increased production of goods essential to the needs of the country and for matters connected therewith or incidental thereto. WHEREAS Messers Vijay Manufacturing Company (Private) Limited, Badnera, and Messers Western India Spinning and Manufacturing Company Limited, Bombay, owning industrial undertakings were engaged in production of articles mentioned in First Schedule to the Industries (Development and Regulation) Act, 1951 (LXV of 1951) i. e. textiles. AND WHEREAS, the companies are being wound up under the supervision of the Bombay High Court and the business of these companies is not being continued, and WHEREAS, the management of the industrial undertakings of the two companies had been taken over by the Maharashtra State Textile Corporation Limited, Bombay on behalf of the Government of India, under section 18fa of the said Act; and WHEREAS, it is expedient to acquire the said undertakings for ensuring continued production of goods essential to the needs of State and the country and to provide for matters connected therewith, or incidental thereto; and WHEREAS, both Houses of the State Legislature were not in session; and WHEREAS, the Governor of Maharashtra was satisfied that circumstances existed which rendered it necessary for him to take immediate action to make a law for the purpose aforesaid, and, therefore, promulgate the Maharashtra Textile Companies (Acquisition and Transfer of Undertakings) Ordinance, 1982 (Mah. Ord. XII of 1982) on the 24th August, 1982. AND WHEREAS, it is expedient to replace the said Ordinance by an Act of the State legislature, it is hereby enacted in the Thirty-third Year of the Republic of India as follows:1. Short title on commencement.--- (1) This Act may be called the Maharashtra Textile Companies (Acquisition and Transfer of Undertakings) Act, 1982. (2) It shall be deemed to have come into force on the 24th day of August, 1982. 2. Definitions.---In this Ordinance, unless the context otherwise requires, (a) "appointed day" means the date on which this Act comes into force, (b) "company" or "textile company" means Messers Vijay Manufacturing Company (Private) Limited, Badnera, or as the case may be, Messers Western India Spinning and Manufacturing Company Limited, Bombay, being Companies as defined in the Companies Act, 1956 (1 of 1956), and having registered offices in the State of Maharashtra; (c) "corporation" or "state Textile Corporation" means the Maharashtra State Textile Corporation Limited, Bombay, a company incorporated and registered under the Companies Act, 1956 (1 of 1956); (d)--- (e)--- (f)---3. Acquisition of transfer of rights of textile Companies in respect of their undertakings.--- (1) On the appointed day, the undertakings of both the textile Companies and the rights, title and interest of the concerned Company in relation to the undertakings shall, by virtue of this Act, stand transferred to and shall vest absolutely in the State Government. (2) Every undertaking which stands vested in the State Government by virtue of sub-section (1) shall immediately after being so vested, stand transferred to and vested in the State Textile Corporation. 4.---5.--- 6.---7. Share to be issued by State Textile Corporation for the value of assets transferred to it by State Government.---An amount equal to the value of assets of the undertakings of each Company transferred to and vested in the State Textile Corporation under sub-section (2) of section 8, shall be deemed to be the contribution made by the State Government to the equity capital of the Corporation; and for the contribution so made, the Corporation shall issue (if necessary after its memorandum and articles of association) to the State Government paid-up shares, on its equity capital, having a face value equal to the amount paid by the State Government as the amount for the acquisition of the said undertakings of the Company concerned. 8. Payment of amount of acquisition.--- (1) The State Government shall deposit, in cash, in the Court to the credit of Messers Vijay Manufacturing Company (Private) Limited, Badnera, an amount equal to the sum of rupees twenty lakhs (Rs. 20 lakhs) for the transfer to, and vesting in the State Government under sub-section (1) of section 3, of the Undertakings of the said Company. (2) The State Government shall likewise deposit, in cash, in the Court to the credit of Messers Western India Spinning and Manufacturing Company Limited, Bombay, an amount equal to the sum of rupees one hundred twenty lakhs (Rs. 120 lakhs) for the transfer to, and vesting in, the State Government, under sub-section (1) of section 3, of the undertakings of the said Company. (3) For the avoidance of doubt, it is hereby declared that the liabilities of each of two textile Companies in relation to their undertakings, which have vested in the State Government, shall be met from the amount referred to in sub-section (1) or sub-section (2), as the case may be. (4) In meeting the liabilities of each of the two textile Companies in relation to their undertakings, which have vested in the State Government, the Court shall distribute the amount referred to in sub-section (1) or sub-section (2), as the case may by, amongst the creditors of the concerned Company, where secured or unsecured, in accordance with their rights and interests and there is any surplus left after such distribution, amongst the contributors of the said Company in accordance with the rights and interest of such contributors. 9. Management and administration of the undertakings.---The undertakings, which have vested in the State Textile Corporation under sub-section (2) of section 3 shall be managed on behalf of the Corporation by such person or body of persons (including one or more Government companies whether in existence at the commencement of this Ordinance or incorporated thereafter) as may be nominated by the Corporation in this behalf, and such person or body of persons shall carry on the management in accordance with such regulations as may be made by the Corporation in this behalf with the previous approval of the State Government. 10. Employment and certain employees of Companies to continue under Corporation.--- (1) Every person, who has been immediately before the appointed day, employed in any undertaking of either of the two textile Companies shall become, on and from the appointed day, an employee of the State Textile Corporation, with the same rights and privileges as to pension, gratuity and other matters as would have been admissible to him if the rights in relation to the undertaking had not been transferred to, and vested, in the Corporation, and shall continue to do so unless and until his employment in the Corporation is duly terminated or until his remuneration and other conditions of service are duly altered by the Corporation. (2) Notwithstanding anything contained in sub-section (1), any liability accruing or arising as a result of continuance of any employee of a company in the service of the Corporation under this section, shall be borne by the Corporation only in respect of any period on or after the date of taking over of the management of the undertaking under section 18fa of the Industries (Development and Regulation) Act, 1951 (LXV of 1951 ). 11. 12. 13. 14. 15. Repeal and saving.--- (1) The Maharashtra Textiles (Acquisition and Transfer of Undertakings) Ordinance, 1982 (Mah. Ord. XII of 1982) is hereby repealed. (2) Notwithstanding such repeal, anything done or any action taken (including any regulation made or any order issued) under the said Ordinance, shall be deemed to have been done, made or issued, as the case may be, under the corresponding provisions of this Act. STATEMENT the management of the industrial undertakings at Badnera in Amravati District owned by Messer Vijay Manufacturing Company (Private) Limited (in liquidation) and the industrial undertakings at Bombay owned by Messers Western India Spinning and Manufacturing Company Limited (in liquidation) was taken over by the Government of India, at the request of the Government of Maharashtra under section 18fa (2) of the Industries (Development and Regulation) Act, 1951 (LXV of 1951) in November 1974 and March 1977, respectively. 2. These undertakings, having an installed capacity of 82. 284 spindles and 1527 looms, ceased production with effect from February 1969 and July 1976 respectively, throwing out of employment around 4500 persons on one hand and on the other hand adversely affecting the production of goods so vital to the needs of the general public and the interests of Government, Commercial Banks and other Financial Institutions. The High Court of Judicature at Bombay has passed winding up orders in respect of these Companies in September 1973 and January 1977, respectively. 3. The two Companies owning these undertakings had gone in liquidation mainly on account of serious financial difficulties. As the undertakings at Badnera owned by Vijay Manufacturing Company were closed for about 5 years, by the time the management was taken over in 1974, only spinning unit having very old and antiquated machinery, was available for restoring the operations. Apparently, during period of erstwhile management all the looms and part of spinning machinery, were removed without being replaced. In regard to the undertakings in Bombay owned by Western India Spinning and Manufacturing Company, there was a serious fire in October, 1973, destroying more than 80 percent of the spinning machinery. This led to imbalance in the machinery, which was partly restored by the erstwhile management by installing 14,000 new spindles, as against required restoration of about 50,000 spindles. 4. Immediately after taking over the management, in order to renovate, replace and expand the machinery, which had become old and imbalanced and insufficient to keep up the desired activity level and employment potential, large funds were ploughed in by the Government of Maharashtra (Rs. 140 lakhs approximately) and by the Commercial Banks in the form of cash credit limits (Rs. 245 lakhs approximately) against guarantee of the Government of Maharashtra, towards the working capital, rehabilitation and partly modernisation programmes. Large scale modernisation programmes in the Mills could not be undertaken, after taking over management, as the Companies were in liquidation. The above investments were made by the Government of Maharashtra as a sequel to its commitment to the Government of India to assume full financial responsibility in running the Mills. 5. For the purpose of ensuring continued and increased production of goods essential to the needs of the State and the Country and providing better management and facilities for employment and safeguarding and securing the investment by Government and Financial Institutions, it is considered expedient, in public interest, to acquire immediately, on payment of a sum of Rs. 20,00,000 (Rupees Twenty Lakhs only) the undertakings of Messers Vijay Manufacturing Company (Private) Limited and on payment of sum of Rs. 1,20,00,000 (Rupees one hundred twenty lakhs) the undertakings of Messers Western India Spinning and Manufacturing Company Limited. 6. As both Houses of the State Legislature are not in session and it is rendered necessary to take immediate action to enact a law to achieve the objects stated above, this ordinance is promulgated. "( 9 ) THE principal question that falls for determination, is whether, in the light of the provisions of the Act of 1982, it was open to the State Government to take a decision for closure of the Mill and whether the Corporation could have made an application under section 25-O of the Act of 1947 seeking closure of the Mill It is true that the Act of 1982 was enacted to provide for the acquisition of the Mill for the purpose of ensuring continued and increased production of goods manufactured by the Mill. The Mill was being wound up under the supervision of the High Court and the management of the Mill was taken over by the Corporation on behalf of the Government of India under section 18fa of the Industries (Development and Regulation) Act, 1951. In order to ensure continued and increased production of goods, the Mill was acquired initially by promulgation of ordinance, which later on was repealed and enacted in the Act of 1982. The Act came into force on 24-8-1982. Section 3 of the Act of 1982 provides that on the "appointed day", that is 24-8-1982, the right, title and interest of the Mill shall stand transferred to and shall vest absolutely in the State Government. It further provides that after the Mill is vested in the State Government, it shall stand transferred to and vested in the Corporation. Section 7 provides for issuance of shares by the Corporation for the value of assets transferred to it by the State Government. The management and administration of the Mill is provided under section 9 of the Act of 1982, which provides that the Mill shall be managed on behalf of the Corporation by such person or body of persons as may be nominated by the Corporation in this behalf and such person or body of persons shall carry on management in accordance with such regulations as may be made by the Corporation in this behalf with the previous approval of the State Government. It is thus provided under section 9 that the Mill shall be managed by the Corporation. Section 10 makes a provision that the employees, who were in employment immediately before the "appointed day", shall become the employees of the Corporation with the same rights and privileges as if the Mill has not been transferred and vested in the Corporation and their employment shall continue unless and until their employment in the Corporation is duly terminated or until their remuneration and other conditions of service are duly altered by the Corporation. Thus section 10 provides that the erstwhile employees, who had become employees of the Corporation on transfer of the Mill, shall continue in employment so long as their services are not duly terminated. In other words, the employment of esrtwhile employees, who became employees of the Corporation, could be brought to an end in accordance with law. An employment of an employee can come to an end by various modes and closure of the Mill is one of the modes by which the employment of the employee can be duly terminated. There is absolutely no provision in the Act of 1982 prohibiting the Corporation from closing the Mill while acting in accordance with law and under various enactments about which the Act of 1982 is silent. The Act of 1982 cannot be read to mean that once the Mill has been acquired under the said Act, it should be necessarily continued to run in perpetuity, even if it has become financially non-viable and there are genuine, valid and adequate grounds for its closure. Merely because the Mill came to be acquired under the Act of 1982 and vested in the State Government thereunder and then transferred to the Corporation, can it be said that the Corporation is compelled to run the said Mill irrespective of numerous valid reasons, which do not justify its continuance. After acquisition of the Mill under the Act of 1982 by the State Government and thereafter transfer to the Corporation, the various enactments, which govern the relationship of the employer and employee between the Mill and its employees cannot be excluded. We find ourselves unable to agree with the submission of the learned Counsel for the Union that since the Act of 1982 is holding the field and is occupied, it was not open to the State Government to decide closure of the Mill. The learned Counsel for the Union relied upon various decisions of the Apex Court to which we refer now. ( 10 ) THE learned Counsel for the Union referred to paragraph 15 of L. Narendra Naths case (supra), the relevant portion of which reads thus:---The Executive have a power to make any regulation which would have the effect of a law so long as it does not contravene any legislation already covering the field and the Government order in this case in no way affected the rights of candidates with regard to eligibility for admission, the test prescribed was a further hurdle by way of competition when mere eligibility could not be made the determining factor. "( 11 ) THE learned Counsel for the Union also relied upon the following observations made by the Apex Court in Thakur Bharat Singhs case (supra), wherein the Apex Court held thus:---All executive action which operates to the prejudice of any person must have the authority of law to support it,---" "---Every Act done by the Government or by its officers must, if it is to operate to the prejudice of any person, be supported by some legislative authority. "( 12 ) THE following passage in B. N. Nagarajans case (supra) was referred to by the learned Counsel for the Union:---It is hardly necessary to mention that if there is a statutory Rule or an Act on the matter, the executive must abide by that Act or Rule and it cannot in exercise of the executive power under Article 162 of the Constitution ignore or act contrary to that Rule or Act. "( 13 ) SHRI Thakur also relied upon the case of R. Chitralekha (supra) , wherein the Apex Court held thus:---It is true that Article 162 says that the executive power of the State is coextensive with the power of the legislature to legislate and this Court has held in (Ram Jawaya Kapur v. State of Punjab), 1955 (2) S. C. R. 225 : (S) A. I. R. 1955 S. C. 549 that the power of the State is not confined to matters over which legislation has already been passed. But neither Article 162 nor the decision of this Court goes so far as to hold that the States power can be exercised in derogation of a law made by a competent legislature.---"( 14 ) PLACING reliance on Bishamber Dayals case (supra), the learned Counsel appearing for the Union referred to paragraph 20 of the report, which reads thus:Even assuming that the impugned teleprinter message is not relatable to the two Control Orders, the State Government undoubtedly could, in exercise of the executive power of the State, introduce a system of verification on movement of wheat from the State of Uttar Pradesh to various other States at the Check-posts on the border and place restrictions on inter-district movement of wheat by traders on private account within the State. The executive power of a modern State is not capable of any precise definition. In Ram Jawaya Kapur v. State of Punjab, 1955 (2) S. C. R. 225 : A. I. R. 1955 S. C. 549, Mukherjee, C. J. , dealt with the scope of Articles 73 and 162 of the Constitution. The learned Chief Justice observed that neither of the two Articles contains any definition as to what the executive function is or gives an exhaustive enumeration of the activities which would legitimately come within its scope. It was observed. "ordinarily the executive power connotes the residue of governmental functions that remain after legislative and judicial functions are taken away. " It is neither necessary nor possible to give an exhaustive enumeration of the kinds and categories of executive functions which may comprise both the formulation of the policy as well as its execution. In other words, the State in exercise of its executive power is charged with the duty and the responsibility of carrying on the general administration of the State. So long as the State Government does not go against the provisions of the Constitution or any law, the width and amplitude of its executive power cannot be circumscribed. If there is no enactment covering a particular aspect, certainly the Government can carry on the administration by issuing administrative directions or instructions, until the legislature makes a law in that behalf. Otherwise, the administration would come to a standstill. "( 15 ) IN Hindustan Aluminium Corporation (cited supra), the Apex Court in paragraph 66 of the report, upon which reliance was placed by the learned Counsel of the Union, reads thus:It has to be appreciated that the power to legislate is both positive in the sense of making a law, and negative in the sense of repealing a law or making if inoperative. In either case, it is a power of the legislature and should lie where it belongs. Any other view will be hazardous and may well be said to be an encroachment on the legislative field. In an extreme and a clear case, no doubt, an antiquated law may be said to have become obsolete - the more so if it is a penal law and has become incapable of user by a drastic change in the circumstances. But the judge of the change should be the Legislature, and courts are not expected to undertake that duty unless that becomes unavoiable and the circumstances are so apparent as to lead to one and only one conclusion. This is equally so in regard to the delegated or subordinate legislation. "( 16 ) THERE cannot be any quarrel on the proposition that the executive or the State power cannot be exercised in derogation of law made by the competent legislature. The question, in the facts and circumstances and in the light of the Act of 1982, is whether the State Government, by taking decision to close the Mill, has exercised power in derogation of the Act of 1982 For the reasons already indicated by us above, it cannot be held that the decision to close down the Mill by the State Government, or for that matter, by making an application under section 25-O of the Act of 1947 by the Corporation, is inconsistent or contrary to or in derogation of the Act of 1982. By referring to the various provisions of the Act of 1982, we have already indicated that the said Act of 1982 does not prohibit the State Government or, for that matter, the Corporation, to take a decision for the closure of the Mill. Rather the provisions contained in sections 9 and 10 of the Act of 1982 do lead to the conclusion that the Corporation is empowered to terminate the employment of the employees in accordance with law, and that would not exclude the termination of employment of the employees as a result of closure. We, therefore, are unable to agree with the submission of the learned Counsel for the Union that the action of the Corporation in making the application under section 25-O of the Act of 1947 is contrary to the Act of 1982. ( 17 ) IN so far as the contention of the learned Counsel for the Union that the Cabinet has not taken a decision to close the Mill is concerned, we are of the view that such submission has been made by misconstruing the communication dated 3-2-1997 sent by the State Government to the Corporation. Since there was a dispute about the exact English translation of the document Annexure-I we got the English translation of the said document done from the Official Translator of this Court, marked "x" for identification purpose. The English translation supplied by the Official Translator of this Court reads thus :"most Urgent/confidential. Government of Maharashtra No. M. W. M. 1697/pk 8/tex. 4. Dept. of Co-operation and Textile, mantralaya Annexe, Mumbai - 400 032. Date 3-2-1997. To, The Managing Director, Maharashtra State Textile Corporation Ltd. , 33-A, Lotus House, New Marine Lines, Mumbai 400 020. Subject:---In respect of closing down Vijay Mills, Badnera run by Maharashtra State Textile Corporation. Sir, In respect of the above subject, I am directed to inform you that, In the meeting of the Cabinet held on 24-12-96, it has been decided that machinery of mills is old and worn out and therefore reconstruction is expected. Further it has been decided that it requires large scale capital expenditure and therefore all the employees/workers in the said mill should be given voluntary retirement and the mill be closed down. Appropriate action in this regard is to be taken and a report thereof may be submitted to the Government. Yours faithfully, Sd/-P. D. Chauhan Desk Officer, Govt. of Maharashtra Dept. of Co-operation and Textile. "( 18 ) IT would be thus seen from the aforesaid document that in the meeting held on 24-12-1996, the Cabinet decided to close down the Mill, as the machinery of the Mill was old and worn out. The Cabinet further decided that the employees/workers in the said Mill should be given voluntary retirement. As the Cabinet was competent to take such decision and such decision having been taken, no fault can be found in the said decision. In Dayakar Reddys case (supra), the Apex Court observed that in a case where the company is a State Government undertaking, the State has to take an administrative decision first and then a quasi-judicial decision under section 25-O. In paragraphs 2, 3 and 4 of the said report, the Apex Court observed thus:2. Allwyn Auto Ltd. was not a sick company taken to B. I. F. R. The company which had become sick was Hyderabad Allwyn Ltd. Under the Scheme framed by B. I. F. R. , the Auto Division of Allwyn was to be transferred to Allwyn Auto Ltd. To implement the Scheme, Allwyn Auto Ltd. was brought into existence in 1993. It was a State Government undertaking. Under the Scheme a certain amount of fund was to be made available to this Company by the Government and the transferee Company namely, Voltas Ltd. , was to allow it to continue to occupy the premises available to it under a lease, for a period of 5 years from 1993. It was expected of Allwyn Auto that it will make some profit towards the end of five years and become a viable unit. However, the hopes turned out to be false because inspite of the Government pumping in about Rs. 13 crores, the Company went on incurring losses and the total loss by the year 1997 was about Rs. 12 crores. The lease was also expiring in 1998 and there was no possibility of getting it extended any further. The Company and the Government found it difficult to get any other location where it could set up the unit afresh. It was under these circumstances, that the Company decided to close down its undertaking. Therefore, it cannot be said that the decision of the Company to close down was not bona fide. 3. After the proposal was received by the Government, discussions had taken place with the trade unions and the representatives of the workmen on many occasions. A Voluntary Retirement Scheme was also proposed. Two meetings took place before the Labour Commissioner. After taking into consideration the material which was available with it, the State Government took the decision that the Company deserved to be closed down. 4. It was contended by Mr. P. S. Mishra, learned Senior Counsel for the petitioner that in this case the State had suggested that the Company should be closed down and it was the same State which then decided under section 25-O to grant permission for closure. In a case where the company is a State Government undertaking, such a situation may arise. It was to take an administrative decision first and then a quasi judicial decision under section 25-O. What we find is that while exercising its power under section 25-O it did follow the proper procedure and consider all the relevant aspects. It is not possible to find any fault with the decision of the State Government. The facts of this case are very eloquent. Moreover, by the time the Government took the decision, out of 1800 workers, 1200 workers had shown their willingness to accept the voluntary Retirement Scheme. GO dated 16-6-1997 clearly disclose the reasons why the Company had become unviable and why it was not able to carry on its activities any further. The reasons appear to be genuine and adequate and therefore the Government was justified in granting permission for closure of the Company. This special leave petition is therefore dismissed. "( 19 ) IN the present case also, the facts are eloquent. In the application, the facts are: (i) old and outdated building and machinery and very low productivity, (ii) continuous heavy losses; (iii) the Mill is non-viable, (iv) the liabilities as on 31-3-1996 amounting to Rs. 813. 91 lakhs exceed the assets which are at Rs. 139. 05 lakhs; (v) the Corporation is a sick company as per the provisions of Sick Industrial Companies (Special Provisions) Act, 1985 and a reference has already been by the Corporation to the Board of Industrial Finance and Reconstruction and as per the report of the operating Agency (IDBI) appointed by B. I. F. R. , the Mill is unviable and has been recommended for closure, etc. Besides that, during the course of arguments, Shri Deshpande, the learned Senior Counsel, after seeking instructions from the Manager of the Corporation, who was in Court, submitted that at the time of acquisition, there were 900 employees. Out of which, 600 employees have already retired and on the date of the application made under section 25-O of the Act of 1947, only 300 employees were in employment. Even the Commissioner of Labour has found the reasons assigned by the Corporation for closure genuine and adequate. For all these reasons, it cannot be said that the Cabinet decision for closure was not in accordance with law or was inconsistent with the provisions of the Act of 1982 or that the application made by the Corporation under section 25-O of the Act of 1947 seeking closure of the Mill was beyond its authority or competence. ( 20 ) SINCE the running of the Mill had become non-viable and in the light of its liabilities, which are more than six times its assets, the submissions of the learned Counsel for the Union that the application made by the Corporation under section 25-O of the Act of 1947 seeking closure of Mill is violative of Articles 14 and 21 of the Constitution of India, cannot be accepted. It is true that by acquisition of the Mill by the State Government and its transfer and further vesting in the Corporation was for the purpose of protecting the employment of its employees, but by passage of time if the objects of acquisition could not be achieved and the Mill continued to run in heavy losses and it became absolutely non-viable, it was open to the Corporation to apply for its closure. There is no merit in the submission of the learned Counsel for the Union that by the Act of 1982, the livelihood of the employees is protected for all times to come. We have already referred to section 10 of the the Act of 1982, which provides for termination of the employees in accordance with law and, therefore, it cannot be said that the employment of the employees was perpetually protected. Reliance placed by the learned Counsel for the Union on paragraphs 32 and 33 of the case of Olga Tellis (supra), paragraphs 230 to 240, 269, 274, 296 and 298 of the Delhi Transport Corporations case (supra) and paragraphs 40 to 47 and 49 of the Air India Statutory Corporations case (supra) do not help the Union in the facts and circumstances of the present case and, therefore, we are not burdening this judgment by quoting the aforesaid judgments extensively. ( 21 ) NOW, we may turn to the submission of the learned Counsel for the Union that the delegation of power by the State Government to the Commissioner of Labour Under section 39 of the Act of 1947 is bad in law and is actuated with malice. The learned Counsel for the Union submitted that the delegation is mala fide, because the power is entrusted for one purpose and is deliberately used with the design of achieving another, which is unauthorised or forbidden. On facts, the learned Counsel for the Union submitted that on 20-3-1997, the Commissioner of Labour refused to accept the copy of Unions reply to the application made by the Corporation under section 25-O of the Act of 1947 and, therefore, a letter was sent by the Union to the Government of India by registered A/d, which was not replied by the State Government. ( 22 ) IN the light of the law laid down by the Apex Court in the Workmen of Meenakshi Mills Ltd. (supra), we are not persuaded by the submission of the learned Counsel for the Union. In paragraph 40 of the report, the Apex Court held thus:As regards the second part of the contention relating to the discretion conferred on the appropriate Government to specify the authority which may exercise the power under sub-section (2), it may be stated that the said discretion is given to the Government itself and not to a subordinate officer. In Virendra v. State of Punjab, this Court was dealing with section 2 (1) (a) of the Punjab Special Powers (Press) Act, 1956, which uses the expression "the State Government or any authority so specified in this behalf". The validity of the said provision was assailed on the ground that it gave unfettered and uncontrolled discretion to the State Government or to the officer authorised by it and reliance was placed on the earlier decision of this Court in Dwarka Prasad Laxmi Narain v. State of U. P. Rejecting the said contention, this Court held: (S. C. R. p. 321)"in the first place, the discretion is given in the first instance to the State Government itself and not to a very subordinate officer like the licensing officer as was done in Dwarka Prasad case. It is true that the State Government may delegate the power to any officer or person but the fact that the power of delegation is to be exercised by the State Government itself is some safeguard against the abuse of this power of delegation. "( 23 ) THOUGH the said observations were made by the Apex Court in the light of the provisions contained in section 25-N of the Act of 1947, we are of the considered view that the said observations are equally applicable to the provisions of section 25-O of the Act of 1947 and that the State Government is competent to delegate its power to the officer or authority subordinate to it. The delegation of the power by the State Government to the Commissioner of Labour under section 39 of the Industrial Disputes Act, 1947, therefore, cannot be faulted. We do not find any merit in the submission of the learned Counsel for the Union that the said delegation was mala fide. As a matter of fact, by Notification dated 17-8-1994, the powers exercisable by the State Government under sections 25-N and 25-O of the Act of 1947 have been delegated to the Commissioner of Labour. The said Notification dated 17-8-1994 reads thus:"notification Industries, Energy and Labour Department, Mantralaya, Bombay 400 032. Dated the 17th August, 1994. No. IDA-194/cr 329/lab-10-In exercise of the powers conferred by section 39 of the Industrial Disputes Act, 1947 (14 of 1947) and in suppression of the Government Notification, Industries, Energy and Labour Department, Industries, Energy and Labour Department, No. OMM. 1088/2697/lab-2, dated the 16th August, 1988, the Government of Maharashtra hereby directs that the powers exercisable by it under sections 25-N and 25-O of the said Act shall also be exercised by the Commissioner of Labour, Bombay. By Order and in the name of the Governor of Maharashtra, B. J. Pol, Under Secretary to Government. "The Notification being general in nature, the question of mala fide does not arise. The whole argument of the learned Counsel for the Union about mala fide is misconceived and does not deserve to be accepted. ( 24 ) HAVING considered the submissions of the learned Counsel for the Union as aforestated, the question now arises is whether the Commissioner of Labour was justified in rejecting the application made by the Corporation for closure of the Mill under section 25-O of the Act of 1947 on the ground of pendency of Writ Petition No. 2453 of 1987 Be it noted that the Commissioner of Labour in the impugned order dated 2-5-1997 concluded that the structure of the factory building was very old and in dilapidated condition and hence it was unsafe. He further held that the ratio of the installed capacity to capacity utilisation was very poor and it was one of the important reasons for heavy losses and subsequent illness of the Mill. The Commissioner of Labour thus held that the reasons for the closure were genuine and reasonable. Despite the aforesaid findings, the Commissioner of Labour rejected the application on the ground that Writ Petition No. 2453 of 1987 was pending. We called for the record and proceedings of Writ Petition No. 2453 of 1987 and perused the papers made therein. In the said writ petition filed by the Union, the Union has challenged the vires of sections 3 and 4 of the Bombay Relief Undertakings (Special Provisions) Act, 1958 and the Notifications issued thereunder and sought direction to the Corporation to run the Mill so as to subserve the purposes of Nationalisation Act of 1982. From the proceedings, we find that no interim order is operating in favour of the Union. In these circumstances, by mere pendency of Writ Petition No. 2453 of 1987, the application made by the Union for closure could not have been rejected, when the Commissioner of Labour found that the reasons for closure were genuine and adequate. The impugned order passed by the Commissioner of Labour on 2-5-1997 was, therefore, unsustainable and has to be set aside to the extent the application for closure has been rejected. In the light of these findings, we do not intend to examine the merits of the contention advanced by the learned Senior Counsel appearing for the Corporation that on expiry of sixty days from the date of making of application under section 25-O of the Act of 1947, since no order was passed by the Commissioner of Labour, the application was deemed to be granted and vehement opposition to this contention by the learned Counsel for the Union that, in the facts and circumstances, there could not have been deemed grant of permission, since before expiry of ninety days, the Commissioner of Labour rejected the application.

Decision:
0[ds]( 8 ) THERE is no dispute that the Mill ceased production and went in liquidation in the month of February, 1969 and this Court passed winding up order in the month of September, 1973 in respect of the said Mill. There is also no dispute that in the month of February, 1974, the Mill was taken over by the Government of India at the instance of the Government of Maharashtra under section(2) of the Industries (Development and Regulation) Act, 1951, and that the Government of Maharashtra exercised the powers conferred on it under the Bombay Relief Undertakings (Special Provisions) Act, 1958 and declared by its Notification datedthe Mill as "relief Undertaking" and similar Notifications were issued from time to time tillwhen the Government of Maharashtra promulgated the Ordinance, which later on became the Act vide Maharashtra Act No. XXXIII ofis true that the Act of 1982 was enacted to provide for the acquisition of the Mill for the purpose of ensuring continued and increased production of goods manufactured by the Mill. The Mill was being wound up under the supervision of the High Court and the management of the Mill was taken over by the Corporation on behalf of the Government of India under section 18fa of the Industries (Development and Regulation) Act, 1951. In order to ensure continued and increased production of goods, the Mill was acquired initially by promulgation of ordinance, which later on was repealed and enacted in the Act of 1982. The Act came into force onSection 3 of the Act of 1982 provides that on the "appointed day", that isthe right, title and interest of the Mill shall stand transferred to and shall vest absolutely in the State Government. It further provides that after the Mill is vested in the State Government, it shall stand transferred to and vested in the Corporation. Section 7 provides for issuance of shares by the Corporation for the value of assets transferred to it by the State Government. The management and administration of the Mill is provided under section 9 of the Act of 1982, which provides that the Mill shall be managed on behalf of the Corporation by such person or body of persons as may be nominated by the Corporation in this behalf and such person or body of persons shall carry on management in accordance with such regulations as may be made by the Corporation in this behalf with the previous approval of the State Government. It is thus provided under section 9 that the Mill shall be managed by the Corporation. Section 10 makes a provision that the employees, who were in employment immediately before the "appointed day", shall become the employees of the Corporation with the same rights and privileges as if the Mill has not been transferred and vested in the Corporation and their employment shall continue unless and until their employment in the Corporation is duly terminated or until their remuneration and other conditions of service are duly altered by the Corporation. Thus section 10 provides that the erstwhile employees, who had become employees of the Corporation on transfer of the Mill, shall continue in employment so long as their services are not duly terminated. In other words, the employment of esrtwhile employees, who became employees of the Corporation, could be brought to an end in accordance with law. An employment of an employee can come to an end by various modes and closure of the Mill is one of the modes by which the employment of the employee can be duly terminated. There is absolutely no provision in the Act of 1982 prohibiting the Corporation from closing the Mill while acting in accordance with law and under various enactments about which the Act of 1982 is silent. The Act of 1982 cannot be read to mean that once the Mill has been acquired under the said Act, it should be necessarily continued to run in perpetuity, even if it has become financiallyand there are genuine, valid and adequate grounds for its closure. Merely because the Mill came to be acquired under the Act of 1982 and vested in the State Government thereunder and then transferred to the Corporation, can it be said that the Corporation is compelled to run the said Mill irrespective of numerous valid reasons, which do not justify its continuance. After acquisition of the Mill under the Act of 1982 by the State Government and thereafter transfer to the Corporation, the various enactments, which govern the relationship of the employer and employee between the Mill and its employees cannot be excluded. We find ourselves unable to agree with the submission of the learned Counsel for the Union that since the Act of 1982 is holding the field and is occupied, it was not open to the State Government to decide closure of the16 ) THERE cannot be any quarrel on the proposition that the executive or the State power cannot be exercised in derogation of law made by the competent legislature. The question, in the facts and circumstances and in the light of the Act of 1982, is whether the State Government, by taking decision to close the Mill, has exercised power in derogation of the Act of 1982 For the reasons already indicated by us above, it cannot be held that the decision to close down the Mill by the State Government, or for that matter, by making an application under sectionof the Act of 1947 by the Corporation, is inconsistent or contrary to or in derogation of the Act of 1982. By referring to the various provisions of the Act of 1982, we have already indicated that the said Act of 1982 does not prohibit the State Government or, for that matter, the Corporation, to take a decision for the closure of the Mill. Rather the provisions contained in sections 9 and 10 of the Act of 1982 do lead to the conclusion that the Corporation is empowered to terminate the employment of the employees in accordance with law, and that would not exclude the termination of employment of the employees as a result of closure. We, therefore, are unable to agree with the submission of the learned Counsel for the Union that the action of the Corporation in making the application under sectionof the Act of 1947 is contrary to the Act of17 ) IN so far as the contention of the learned Counsel for the Union that the Cabinet has not taken a decision to close the Mill is concerned, we are of the view that such submission has been made by misconstruing the communication datedsent by the State Government to the Corporation. Since there was a dispute about the exact English translation of the documentwe got the English translation of the said document done from the Official Translator of this Court, marked "x" for identification18 ) IT would be thus seen from the aforesaid document that in the meeting held onthe Cabinet decided to close down the Mill, as the machinery of the Mill was old and worn out. The Cabinet further decided that the employees/workers in the said Mill should be given voluntary retirement. As the Cabinet was competent to take such decision and such decision having been taken, no fault can be found in the said decision. In Dayakar Reddys case (supra), the Apex Court observed that in a case where the company is a State Government undertaking, the State has to take an administrative decision first and then adecision under section19 ) IN the present case also, the facts are eloquent. In the application, the facts are: (i) old and outdated building and machinery and very low productivity, (ii) continuous heavy losses; (iii) the Mill is(iv) the liabilities as onamounting to Rs. 813. 91 lakhs exceed the assets which are at Rs. 139. 05 lakhs; (v) the Corporation is a sick company as per the provisions of Sick Industrial Companies (Special Provisions) Act, 1985 and a reference has already been by the Corporation to the Board of Industrial Finance and Reconstruction and as per the report of the operating Agency (IDBI) appointed by B. I. F. R. , the Mill is unviable and has been recommended for closure, etc. Besides that, during the course of arguments, Shri Deshpande, the learned Senior Counsel, after seeking instructions from the Manager of the Corporation, who was in Court, submitted that at the time of acquisition, there were 900 employees. Out of which, 600 employees have already retired and on the date of the application made under sectionof the Act of 1947, only 300 employees were in employment. Even the Commissioner of Labour has found the reasons assigned by the Corporation for closure genuine and adequate. For all these reasons, it cannot be said that the Cabinet decision for closure was not in accordance with law or was inconsistent with the provisions of the Act of 1982 or that the application made by the Corporation under sectionof the Act of 1947 seeking closure of the Millwas beyond its authority or20 ) SINCE the running of the Mill had becomeand in the light of its liabilities, which are more than six times its assets, the submissions of the learned Counsel for the Union that the application made by the Corporation under sectionof the Act of 1947 seeking closure of Mill is violative of Articles 14 and 21 of the Constitution of India, cannot be accepted. It is true that by acquisition of the Mill by the State Government and its transfer and further vesting in the Corporation was for the purpose of protecting the employment of its employees, but by passage of time if the objects of acquisition could not be achieved and the Mill continued to run in heavy losses and it became absolutelyit was open to the Corporation to apply for its closure. There is no merit in the submission of the learned Counsel for the Union that by the Act of 1982, the livelihood of the employees is protected for all times to come. We have already referred to section 10 of the the Act of 1982, which provides for termination of the employees in accordance with law and, therefore, it cannot be said that the employment of the employees was perpetually protected. Reliance placed by the learned Counsel for the Union on paragraphs 32 and 33 of the case of Olga Tellis (supra), paragraphs 230 to 240, 269, 274, 296 and 298 of the Delhi Transport Corporations case (supra) and paragraphs 40 to 47 and 49 of the Air India Statutory Corporations case (supra) do not help the Union in the facts and circumstances of the present case and, therefore, we are not burdening this judgment by quoting the aforesaid judgments1 ) NOW, we may turn to the submission of the learned Counsel for the Union that the delegation of power by the State Government to the Commissioner of Labour Under section 39 of the Act of 1947 is bad in law and is actuated with malice. The learned Counsel for the Union submitted that the delegation is mala fide, because the power is entrusted for one purpose and is deliberately used with the design of achieving another, which is unauthorised or forbidden. On facts, the learned Counsel for the Union submitted that onthe Commissioner of Labour refused to accept the copy of Unions reply to the application made by the Corporation under sectionof the Act of 1947 and, therefore, a letter was sent by the Union to the Government of India by registered A/d, which was not replied by the State23 ) THOUGH the said observations were made by the Apex Court in the light of the provisions contained in sectionof the Act of 1947, we are of the considered view that the said observations are equally applicable to the provisions of sectionof the Act of 1947 and that the State Government is competent to delegate its power to the officer or authority subordinate to it. The delegation of the power by the State Government to the Commissioner of Labour under section 39 of the Industrial Disputes Act, 1947, therefore, cannot be faulted. We do not find any merit in the submission of the learned Counsel for the Union that the said delegation was mala fide. As a matter of fact, by Notification datedthe powers exercisable by the State Government under sectionsof the Act of 1947 have been delegated to the Commissioner ofit noted that the Commissioner of Labour in the impugned order datedconcluded that the structure of the factory building was very old and in dilapidated condition and hence it was unsafe. He further held that the ratio of the installed capacity to capacity utilisation was very poor and it was one of the important reasons for heavy losses and subsequent illness of the Mill. The Commissioner of Labour thus held that the reasons for the closure were genuine and reasonable. Despite the aforesaid findings, the Commissioner of Labour rejected the application on the ground that Writ Petition No. 2453 of 1987 was pending. We called for the record and proceedings of Writ Petition No. 2453 of 1987 and perused the papers made therein. In the said writ petition filed by the Union, the Union has challenged the vires of sections 3 and 4 of the Bombay Relief Undertakings (Special Provisions) Act, 1958 and the Notifications issued thereunder and sought direction to the Corporation to run the Mill so as to subserve the purposes of Nationalisation Act of 1982. From the proceedings, we find that no interim order is operating in favour of the Union. In these circumstances, by mere pendency of Writ Petition No. 2453 of 1987, the application made by the Union for closure could not have been rejected, when the Commissioner of Labour found that the reasons for closure were genuine and adequate. The impugned order passed by the Commissioner of Labour onwas, therefore, unsustainable and has to be set aside to the extent the application for closure has been rejected. In the light of these findings, we do not intend to examine the merits of the contention advanced by the learned Senior Counsel appearing for the Corporation that on expiry of sixty days from the date of making of application under sectionof the Act of 1947, since no order was passed by the Commissioner of Labour, the application was deemed to be granted and vehement opposition to this contention by the learned Counsel for the Union that, in the facts and circumstances, there could not have been deemed grant of permission, since before expiry of ninety days, the Commissioner of Labour rejected the application.