IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE P.N.RAVINDRAN MONDAY, THE 31ST JANUARY 2011 / 11TH MAGHA 1932 WP(C).No. 25854 of 2006(C) --------------------------------------- PETITIONER: ------------------- SANTHIKUMAR, VAISHAKH, SANTHI NAGAR HOUSING COLONY, NER DINESH AUDITORIUM, KANNUR-2. BY ADVS. SRI.N.NAGARESH, SRI.BINU PAUL, SRI.T.V.JAYAKUMAR NAMBOODIRI, SRI.M.M.VINOD KUMAR, SRI.THUSHAR NIRMAL SARATHY, SRI.P.K.RAKESH KUMAR. RESPONDENTS: ------------------------ 1. P. VALSARAJAN, SECRETARY, CANNANORE DISTRICT SHOP, ESTABLISHMENT EMPLOYEES AND LABOUR FEDERATION, N.L.O.OFFICE, KANNUR-1. 2. P. SREEDHAR, PARTNER, MAHITHA VASTHRALAYAM, RANI INTERNATIONAL, END 7/033, OKHELA INDUSTRIAL AREA, PHASE-11, NEW DELHI-110 020. 3. A. SARAHDA, PARTNER, MAHITHA VASTRALAYAM, SARADHA BHAVAN, P.O. EACHUR, KANNUR. 4. K.P. JEEJA, PARTNER, MAHITHA VASTHRALAYAM, SARDHA BHAVAN, P.O. EACHUR, KANNUR. 5. V.P. SULOCHANA, PARTNER, MAHITHA VASTHRALAYAM, C/O. GANESH DAS WEAVING WORKS, P.O. EACHUR, KANNUR. 6. K. PRASANNA, PARTNER, MAHITHA VASTHRALAYAM, W/O. SEKHARAN MASTER, C/O. GANESH DAS WEAVING MILLS, P.O.EACHUR, KANNUR. R1 BY ADV. SRI.K.S.MADHUSOODANAN. THIS WRIT PETITION (CIVIL) HAVING BEEN FINALLY HEARD ON 31/01/2011,ALONG WITH W.P.(C).NO.19405/2010, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: W.P.(C). NO.25854/2006-C: APPENDIX PETITIONERS' EXHIBITS: EXT.P.1: COPY OF THE CLAIM STATEMENT IN I.D. NO. 25/2003 DTD. 16/12/2003 OF THE R.1. EXT.P.2: COPY OF THE WRITTEN STATEMENT FILED BY THE PETITIONER IN I.D. NO. 25/2003. EXT.P.3: COPY OF THE AWARD IN I.D. NO. 25/2003 DTD. 03/02/2005 OF THE INDUSTRIAL TRIBUNAL, KOZHIKODE. RESPONDENTS' EXHIBITS: NIL. //TRUE COPY// P.A. TO JUDGE. Prv. P.N.RAVINDRAN, J. --------------------------- W.P.(C) Nos. 25854 of 2006 & 19405 of 2010 -------------------------- Dated this the 31st day of January, 2011 J U D G M E N T Ext.P3 award passed by the Industrial Tribunal, Kozhikode in I.D. No.25 of 2003 is under challenge in W.P.(C) No. 25854 of 2006 and Ext.P2 order passed by the Labour Court, Kannur in C.P. No.31 of 2005 filed by the workmen seeking payment of the monetary benefits pursuant to Ext.P3 award, which is the subject matter of W.P.(C) No.25854 of 2006, is under challenge in W.P.(C) No.19405 of 2010. Since the issues involved and the parties are common, the writ petitions were heard together and are being disposed of by a common judgment. The brief facts of the cases are as follows: 2. The petitioner in W.P.(C) No.25854 of 2006 and respondents 2 to 6 therein were running a textile shop on partnership basis. The first respondent in W.P.(C) No.25854 of 2006 represents 7 employees of the said shop, who are respondents 1 to 7 in W.P.(C) No.19405 of 2010. The textile shop was being run in a shop room belonging to the Kannur Municipality. For non payment of the lease rent, the firm and its partners were evicted from the shop room leading to closure of the establishment with effect from 30.9.2000. The employer did not however pay closure compensation to the employees. That led to a dispute, which was referred to the Industrial Tribunal. The issue referred was:- WPC Nos.25854/06 & 19405/10 2 “Whether the denial of employment to (1) Sri.C.K.Sureshan (2) Sri.A.Raveendran (3) Sri.T.chandran (4) Sri.A.C.Sunilkumar (5) Sri.C.Haridasan (6) Sri.K.Haridasan (7) Sri.P.Pavithran workers of Mahitha Vasthralayam, Stadium Complex, Kannur due to the alleged closure of the establishment with effect from 30.9.2000 is justifiable? If not, what relief the workers are entitled to?' 3. The Industrial Tribunal on an analysis of the evidence oral and documentary available in the case held that no closure compensation was paid to the employees. The Tribunal accordingly directed payment of closure compensation together with interest at 9% per annum from 1.1.2001. The Tribunal also directed the management to pay gratuity to the employees in terms of the provisions contained in the Payment of Gratuity Act. The main contention raised by the petitioner is that the Industrial Tribunal should not have passed an award for payment of gratuity and that the Tribunal should have directed the employees to move the authority constituted under the Payment of Gratuity Act, 1972 claiming gratuity. 4. I heard Sri.N.Nagaresh, learned counsel appearing for the employer and Sri.K.S.Madhusoodanan, learned counsel appearing for the workmen. The petitioner has no case that after the establishment was closed down with effect from 30.9.2000 retrenchment compensation or closure compensation was paid to the employees. The Tribunal has on an appreciation of the pleadings and the evidence held that in the instant WPC Nos.25854/06 & 19405/10 3 case it cannot be said that closure was on account of reasons beyond the control of the management and therefore the workmen are entitled to be paid closure compensation based on the length of service which they had in the establishment. The Tribunal also held that as closure compensation were not paid within three months from 30.9.2000, the workmen are entitled to interest at the rate of 9% per annum from 1.1.2010 onwards. In my opinion, the said finding of the Tribunal cannot be faulted. It is not in dispute that closure compensation had not been paid to the employees before the award was passed. Even thereafter, the closure compensation was not paid and that resulted in the order which is impugned in W.P.(C) No.19405 of 2010. Therefore, the finding that there was default on the part of the petitioner and the other partners of the firm to pay closure compensation cannot be assailed. The Tribunal has also held that the reasons which led to the closure namely non payment of rent to the landlord cannot be said to be beyond the control of the management so as to limit payment of closure compensation for three months in terms of the proviso to sub section (c) of section 25 FFF of the Industrial Disputes Act. The said reasoning cannot also said to be faulty. The Tribunal has on account of the failure to pay the closure compensation also directed that the workmen shall be paid interest. The said direction is also one within the competence of the Tribunal. I therefore find no grounds to interfere WPC Nos.25854/06 & 19405/10 4 with Ext.P3 to the extent it directs payment of closure compensation and interest on the closure compensation to the workmen. Sri.K.S.Madhusoodanan, learned counsel appearing for the workmen however fairly conceded that the direction issued by the Industrial Tribunal in Ext.P3 award to pay gratuity cannot be sustained. The learned counsel also submitted that the employees concerned have moved the Controlling Authority under the Payment of Gratuity Act, 1972 to realise gratuity and that orders have already been passed determining the gratuity payable to them. In such circumstances, I allow W.P.(C) No.25854 of 2006 in part and quash Ext.P3 award to the extent it directs payment of gratuity to the employees. It is however clarified that this will not stand in the way of the employees from moving the Controlling Authority under the Payment of Gratuity Act, 1972 seeking payment of gratuity under the provisions of the said Act. 5. I shall now deal with W.P.(C) No.19405 of 2010 wherein the petitioner challenges Ext.P2 order passed by the Labour Court. By that order, the Labour Court directed the petitioner to pay closure compensation and notice pay in terms of the award passed by the Industrial Tribunal. The main ground raised in this writ petition is that the award passed by the Industrial Tribunal which led to Ext.P2 order is itself under challenge and therefore Ext.P2 order should not have been passed. The petitioner has WPC Nos.25854/06 & 19405/10 5 not disputed the monthly wages claimed by the employees or the determination of quantum made by the Labour Court. In view of the stand taken by me that the award passed by the Industrial Tribunal directing payment of closure compensation does not merit interference, the challenge to Ext.P2 cannot be entertained. Further the employees had not in the application, which led to Ext.P2, claimed payment of gratuity. I therefore find no grounds to grant the relief prayed for in W.P.(C) No.19405 of 2010. The writ petitions fail and are accordingly dismissed. No costs. P.N.RAVINDRAN, (JUDGE) vps WPC Nos.25854/06 & 19405/10 6 WPC Nos.25854/06 & 19405/10 7