:1: IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.49 OF 2009 Borosil Glass Works Ltd. Employees’ Union ..Petitioner. Vs. Borosil Glass Works Ltd. & Ors. ..Respondents. Mr.S.J.Deshmukh, Sr.Advocate with Mr.R.D.Bhat for the Petitioner. Mr.J.P.Cama, Sr.Counsel with Mr.R.N.Shah i/b.Sanjay Udeshi & Co. for Respondent no.1. Mr.C.U.Singh, Sr.Counsel with Mr.Mahesh Londhe i/b.Sanjay Udeshi & Co. or Respondent nos.2 and 3. CORAM : S.J. VAZIFDAR, J. CORAM : S.J. VAZIFDAR, J. CORAM : S.J. VAZIFDAR, J. DATED : 19TH JANUARY, 2009 DATED : 19TH JANUARY, 2009 DATED : 19TH JANUARY, 2009 P.C. : P.C. : P.C. : The Petitioner has challenged the judgment dated 29.11.2008 passed by the Industrial Court in Complaint (ULP) No.161 of 2008. The main question in this Writ Petition is a question of law. 2. Respondent no.1 is engaged inter-alia in the business of manufacturing of low expansion borosilicate glass. Respondent no.1 had a factory at Marol in Mumbai. There were two departments in the factory viz. hot end and the cold end. The action of Respondent no.1 which is challenged is shifting of the entire cold end department to Boridra in Gujarat. Pursuant to a letter dated :2: 12.3.2008, 135 employees were issued letters informing them that from the close of working hours on 15.4.2008 they were transferred to Boridra. The physical transfer of the entire factory has already taken place. 3. The question raised on behalf of the Petitioner is that the said action of Respondent no.1 constitutes a closure. On behalf of the Respondents, it is submitted that, in law, the said variation does not constitute a closure. 4. The Industrial Court rejected this contention following the judgments of this Court in the case of Biddle Sawyer Ltd. v. Chemical Employees Union (2007) II CLR, 193, Nicholas Piramal India Ltd. v. Nicholas Employees Union (2008) I CLR, 501, Hindustan Lever Employees Union v. Sate of Maharashtra & Ors. (1993) 67 FLR, 115 and Pearlite Liners Pvt. Ltd. v. Manorama Shirsi (2004) 100 FLR, 797 (Supreme Court). The learned Single Judges and Division Bench of this Court have expressly held that the said Act would not constitute a closure. :3: 5. In Biddle Sawyer Ltd., the Division Bench held as under :- "Having considered extensively all the judgments placed before us by the learned Senior Counsel, the law relating to "closure" seems to be a well settled one. Closure is the closing down permanently of the source of employment of the workmen i.e. the place where the employment is actively generated. It thus follows that closing down of a "place" of business would not amount to closure as that would be over simplification which would lead to various negative ramifications as they have been extensively dealt with in the earlier part of the judgment in various quotations from various judgments. It must be recalled that the object of labour legislation is a social welfare legislation. It is an umbrella of protection provided to workmen to shield them from the employer exploiting their vulnerable position. But, it cannot be said that merely because a place of manufacture has been closed down and restarted at another place or transferred to another employer that the undertaking has been closed down. The business itself is still alive, the source of employment is still present and there is no valid closure in law." The judgments are binding upon me. 6. Mr.Deshmukh however submitted that each of these judgments is per-incurium as none of them have considered the judgments of the Supreme Court in Workmen of Meenakshi Mills Ltd. & Ors. v. :4: Meenakshi Mills Ltd. & Anr., 1992 Supreme Court Cases (L&S) 679 and Orissa Textile & Steel Ltd. v. State of Orissa & Ors., 2002 I CLR, 831. Mr.Deshmukh also relied upon paragraph 18 of the judgment in Orissa Textile & Steel Ltd. v. State of Orissa & Ors. "18. We also see no substance in the contention that the amended section merely deals with the procedural defects pointed out in Excel Wear’s case and does not deal with the substantive grounds set out in Excel Wear’s case. In our view the amended Section 25-O is very different from Section 25-O (as it then stood). It is now more akin to Section 25-N (as it then stood) the constitutional validity of which was upheld in Meenakshi Mills’ case. In Excel Wear’s case it has been accepted that reasonable restrictions could be placed under Article 19(6) of the Constitution. Excel Wear’s case recognizes that in the interest of general public it is possible to restrict, for a limited period of time, the right to close down the business. The amended Section 25-O lay down guidelines which are to be followed by the appropriate government in granting or refusing permission to close down. It has to have regard to the genuineness and adequacy of the reasons stated by the employer. However, merely because the reasons are genuine and adequate cannot mean that permission to close must necessarily be granted. There could be cases where the interest of general public may require that no closure takes place. Undoubtedly where the reasons are genuine and adequate the interest of the general public must be :5: of a compelling or overriding nature. Thus, by way of examples, if an industry is engaged in manufacturing of items required for defence of the country, then even though the reasons may be genuine and adequate it may become necessary, in he interest of the general public, not to allow closure for some time. Similarly, if the establishment is manufacturing vaccines or drugs for an epidemic which is prevalent at that particular point of time, interest of the general public may require not to allow closure for a particular period of time. We must also take a note of sub-section (7) of the amended Section 25-O which provides that if there are exceptional circumstances or accident in the undertaking or death of the employer or the like, the appropriate government could direct that provision of sub-section (1) would not apply to such an undertaking. This, in our view, makes it clear that the amended Section 25-O recognizes that if there are exceptional circumstances then there could be no compulsion to continue to run the business. It must however be clarified that this Court is not laying down that some difficulty or financial hardship in running the establishment would be sufficient. The employer must show that it has become impossible to continue to run the establishment. Looked at from this point of view, in our view, the restrictions imposed are reasonable and in the interest of the general public." Mr.Deshmukh also relied upon paragraphs 32 and 33 of the judgment in Workmen of Meenakshi Mills Ltd. which read as under :- "32. As regards the factors which are to be taken into consideration by the :6: appropriate Government or authority while exercising its power under sub-section (2) of Section 25-N, Shri Nariman has urged that since no indication about these factors is given in sub-section (2), it should be held that Parliament did not intend to alter the existing law governing retrenchment and the principles of industrial law that are applied by Industrial Tribunals for examining the validity of retrenchment under Section 25-F would also be applicable in the matter of exercise of power under sub-section (2) of Section 25-N. In this context, Shri Nariman has submitted that the law governing retrenchment is well settled by the decisions of this Court in D. Macropollo & Co. (Pvt.) Ltd. v. Their Employees’ Union; Workmen of Subong Tea Estate v. Outgoing Management of Subong Tea Estate and Parry & Co. Ltd. v. P.C. Pal wherein it has been laid down that (i) management can retrench its employees only for proper reasons which means that it must not be actuated by any motive of victimisation or any unfair labour practice; (ii) it is for the management to decide the strength of its labour force; (iii) if the number of workmen exceeded the reasonable and legitimate needs of the undertaking, it is open to the management to retrench them; (iv) workmen have become surplus on the ground of rationalisation or economy, reasonably or bona fide adopted by the management or on the ground of any other industrial or trade reasons; and (v) the right to effect retrenchment cannot normally be challenged but when there is a dispute about the validity of retrenchment the impugned retrenchment must be shown as justified on proper reasons, i.e., that it was not capricious or without rhyme or reason. Shri Nariman has invoked the principle of statutory construction that the legislature should not be considered to make radical changes in law without using explicit language which unmistakably points in that direction :7: and has placed reliance on the decision of his Court in Byram Pestonji Gariwala v. Union Bank of India. We are unable to accept this contention of Shri Nariman for the reason that the principles aforementioned governing retrenchment were laid down by this Curt at a time when retrenchment, as defined in Section 2(oo) of the Act, was confined to mean discharge of surplus labour or staff. There has been a change in the law relating to retrenchment since the decision of this Court in State Bank of India v. N. Sundara Money wherein "retrenchment", as defined in Section 2(oo), was construed to mean termination howsoever produced and all terminations except those specified in clauses (a), (b) and (c) of Section 2(oo) were held to be retrenchment. The said view in State Bank of India v. N. Sundara Moey was reiterated in the subsequent decisions of this Court in Delhi Cloth & General Mills Ltd. v. Shambhu Nath Mukherjee; Santosh Gupta v. State Bank of Patiala; Hindustan Steel Ltd. v. Presiding Officer, Labour Court; Surendra Kumar Verma v. Central Government Industrial Tribunal-cum-Labour Court, New Delhi; Mohanlal v. Bharat Electronics Ltd.; Karnataka State Road Transport Corporation v. M. Boraiah and Gammon India Ltd. v. Niranjan Das. The matter now stands concluded by the decision of the Constitution Bench of this Court in Punjab Land Development and Reclamation Corporation Ltd., Chandigarh v. Presiding Officer, Labour Court, Chandigarh wherein the decision in State Bank of India v. N. Sundara Money and subsequent decisions have been approved and it has been held that retrenchment, as defined in Section 2(oo), means termination by the employer of the service of a workman for any reason whatsoever otherwise than as a punishment inflicted by way of disciplinary action and those expressly excluded by clauss (a), (b) and (c) of the definition. In view of these :8: decisions, it cannot be said that retrenchment means termination by the employer of the service of a workman as surplus labour and, therefore, the law that was laid down by this Court in D. Mcropollo & Co. case, Workmen of Subong Tea Estate case and Parry & Co. case on the basis of the said restricted meaning of retrenchment cannot be held to govern the exercise of the power by the appropriate Government or the authority under sub-section (2) of Section 25-N. It is significant that even according to these decisions existence of proper reasons was a restriction on the employer’s right of retrenchment earlier also. It is only the scope of the reasons which has undergone a change with this alteraton in the law. 33. We are also of the opinion that in enacting Chapter V-B the intention of Parliament was to alter the existing law relating to lay-off, retrenchment and closure in relation to larger industrial establishments falling within the ambit of Chapter V-B because it was felt that the existing law enabled large-scale lay-offs, retrenchments and closures by large companies and undertakings and this had resulted in all round demoralising effect on workmen. We are, therefore, unable to uphold the contention of Shri Nariman that in enacting Section 25-N, Parliament did not intend to alter the existing industrial law governing retrenchment of workmen." 7. The learned Judge of the Industrial Court has rightly held that it was not open to him to refuse to follow the judgments of this Court. The judgments squarely answer the question which has been raised in the present matter. What was :9: submitted on behalf of the Petitioners was that the judgment of the Supreme Court impliedly overrules these judgments. 8. It is not possible to accept this contention. Neither of the judgments dealt with the question which now falls for consideration. It is true that the Supreme Court has observed that in enacting Chapter V-B the intention of Parliament was to alter the existing law relating to lay-off, retrenchment and closure. That by itself would be no justification for holding that the judgments of this Court have been impliedly overruled. 9. In this view of the matter, it is not open for me to consider the correctness of the above judgments of this Court. 10. Mr.Deshmukh submitted that I ought to exercise my powers under Rule 228 of the High Court (Original Side) Rules and place the matter before the learned Chief Justice for consideration as to whether the matter shall be placed before a larger bench. 11. In my view, considering that an appeal is available and one of the judgments said to be no :10: longer good law, is a judgment of a Division Bench, propriety demands that such an application also sought to be considered by a Division Bench and not by a Single Judge. 12. In the circumstances, the Writ Petition is dismissed. The order dated 10.7.2008 in W.P. No.1284 of 2008 as clarified, shall continue upto and inclusive of 10.2.2009.