C.W.P No.18020 of 1997 -1- IN THE HIGH COURT FOR THE STATES OF PUNJAB AND HARYANA AT CHANDIGARH C.W.P No.18020 of 1997 Date of Decision: 14.07.2009 M/s Pots India .....Petitioner Versus Presiding Officer, Labour Court-II, Faridabad and another ...Respondents Present: Mr. Anil Shukla, Advocate for the petitioner. Mr. Ashwani Bakshi, Advocate for respondent No.2. CORAM:HON'BLE MR. JUSTICE K. KANNAN 1. Whether Reporters of local papers may be allowed to see the judgment ? Yes 2. To be referred to the Reporters or not ? Yes 3. Whether the judgment should be reported in the Digest ?Yes -.- K. KANNAN J. (ORAL) 1. The impugned award in the writ petition is a direction given by the Labour Court for back wages and retrenchment compensation under Section 25-F of the Industrial Disputes Act, 1947. The ground of challenge by the management is that a commission issued by the Labour Court returned a report stating that the factory had remained closed and hence, the award of the Labour Court is erroneous in that it rejected the report without any valid justification by accepting the contention of the workman that the management was running three establishment by different names only with an intent of evading its responsibility. According to him, such a contention had not been taken anywhere in the claim statement. On the other hand, the C.W.P No.18020 of 1997 -2- contention had been that all the workers were going to their homes after doing the work on 30.07.1992 at 5 P.M. and the following day, they found the gate closed and the owners were not there. This statement, according to the learned counsel, would show an admission on the part of the workman that the factory had been closed. It was his endeavour to show that if the factory had been closed, the relevant provisions that would be applicable only to Section 25 (FFF) and not Section 25-F. He also relied on the judgment of the Hon'ble Supreme Court in Managing Director, Haryana Seeds Development Corpn. Ltd. Vs. Presiding Officer & Anr. 1997 Judicial Reports (Labour & Services) 670 to the effect that if there was a closure of the factory, the rigour imposed under Section 25-F would stand excluded and the compensation would be payable only of three months' salary prior to the closure. 3. On the issue relating to closure, a mere averment in the claim statement that after the workers left the factory on 30.07.1992, they were faced with the situation on the following day that the gate was closed ought not to mean closure in the eye of law. It is not merely the physical act of closing the gate that would amount to closure. It is a complete cessation of business activity that the law contemplates for the expression closure. In this case, the Labour Court has rejected the contention of the management that there had been closure of the business and it refused to accept even the report by observing that it was the very same management which was carrying its operation at the very same premises with the names of three entities. The management did not produce before the Court the best C.W.P No.18020 of 1997 -3- evidence that was possible if it had wanted to substantiate its defence that the factory had remained closed, which it could have done by reference to records such as the accounts, income-tax returns, excise duties if they were applicable, the continuance or otherwise of the assessments and a host of other official records, which could have established the truth of the contention. The management was, however, prepared to rest contended with trying to rely on a Commissioner's report that could never be conclusive. Commission cannot himself decide whether a factory is closed or not. It will amount to abdication of judicial function to refer to a Commissioner to decide whether a factory had been closed or not. If we must, therefore, eschew the report of the commission, which the Labour did although for different reasons. There is no other evidence to show that the factory had been closed. 4. Even if there was some ground to suspect that the factory had been closed, the application of Section 25(FFF) will again depend on the closure of factory for reasons beyond the control of the management. This is an additional burden which the management ought to take upon themselves and discharge it effectively. Learned counsel appearing for the management would contend that there was a fire in the factory that necessitated the closure and there was also a FIR to show that the fact of accident had been reported to the police. The document itself was not put on record before this Court but this fact has been referred to even in the award of the Labour where it dealt with Document Ex.MX, which is a Daily Diary Report, in which it observed that the same had not been entered at the instance of the C.W.P No.18020 of 1997 -4- respondent-management and it had been informed by Sh. Shakarmal Kedia of M/s Pankaj Papers Products. It should be noticed that M/s Pankaj Papers Products is not even one of the alleged entities which was in actual possession of the premises. The report of the commission refers to M/s Pankaj Enterprises and not M/s Pankaj Papers Products. In any event, the finding, which has been rendered by the Labour Court has considered the documents which had been relied on and the Labour Court chose to take a particular decision. It is not a case of non-consideration of relevant materials but it was significantly a finding rendered on the evidentiary value of particular documents which was relied on by the management. 5. Learned counsel appearing for the petitioner states that the relief which the Labour Court granted to the workman was not really one of reinstatement but it awarded only back wages on a reasoning that the factory was found to be closed “at present”. This finding, according to him, was inconsistent with the earlier finding that there had been no closure of the factory. An acceptance of the plea whether the factory had been closed or not and whether it was possible to apply only the benefits under Section 25(FFF) is completely different from what could be efficacious remedy for a workman. It would have been futile for the Labour Court to grant relief of reinstatement to an unwilling management that was creating new entities. The appropriate remedy would have been to grant only the relief of back wages and retrenchment compensation. The adequacy of relief was itself not in challenge at the instance of the workman and the writ petition has been only by the management, in so far as it directed the back wages C.W.P No.18020 of 1997 -5- and compensation. 6. The decision of the Labour Court, in my view, accords with evidence and what was just under the circumstances and calls for no interference in the writ petition. The writ petition is, accordingly, dismissed. No costs. (K. KANNAN) JUDGE July 14, 2009 Pankaj*