C.W.P. No.406 of 2002 -1- IN THE HIGH COURT FOR THE STATES OF PUNJAB AND HARYANA AT CHANDIGARH C.W.P. No.406 of 2002 Date of Decision: 12.11.2009 Auto Lamps Employee Union, Faridabad .....Petitioner Versus State of Haryana and another ....Respondents Present: Ms. Abha Rathore, Advocate for the petitioner. Mr. D.S. Nalwa, Addl. A.G., Haryana for respondent No.1. Mr. P.K. Mutneja, 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 ? No 2. To be referred to the Reporters or not ? No 3. Whether the judgment should be reported in the Digest? No -.- K. KANNAN J. 1. On an application seeking for permission to retrench 68 workers of different categories sought at the instance of the management M/s Auto Lamps Ltd., the Labour Commissioner, Haryana being the Specified Authority granted permission for retrenchment of 30 workmen and directed at the same time that such exercise shall be done in the different categories and departments of the factory depending upon the requirement of each category of workers in compliance with the provisions of Section 25-G of the Industrial Disputes Act. In effect, the application had been partly allowed on 14.12.2001. The Auto Lamps Employees Union aggrieved by the permission granted has filed the above C.W.P. No.406 of 2002 -2- writ petition. 2. The challenge mounted to the permission has been brought on three counts: (i) the competent authority did not apply its mind to what was necessary to be considered in such like application; (ii) the procedure applied for the enquiry contemplated under Section 25-N was not duly followed and (iii) the seniority was not maintained category-wise and no reasons had been given on what basis the competent authority had decided to grant the permission for 30 persons. There was no warrant for an inference of a partial requirement of the management. The objection, which has been taken by the respondent-management to the writ petition is that it takes up issues of disputed question, which cannot be resolved in the writ petition. The procedure delineated under Section 25-N(6) admits of an application for review and if need be, reference to a Labour Court and the writ petition filed without resort to such a procedure is not competent. The authority had considered the requirements of the management for the compulsions to retrench some of their workmen in view of mounting losses which have been reflected in the account book submitted before the Government. The competent authority had also undertaken an inspection through a Labour Inspector and the ultimate decision had come to be taken on due appraisal of the operation of the factory and how from manufacturing activity, they had shifted to trading activity of sale of certain types of lamps. The authority had also ensured that even while granting C.W.P. No.406 of 2002 -3- permission, the categories of each department were to maintain appropriate seniority list so that there is a due compliance of Section 25-F of the Industrial Disputes Act. The general objection raised that some victimization had been practised by the management in choosing the names of certain trade union leaders was denied and it was contended that such a contention had not been taken even before the competent authority. 3. As a matter of subsequent development, the respondent also contended that the impugned order stood implemented and even all the workers had been retrenched on 02.01.2002. The company had faced acute losses and the entire net worth of the company stood eroded. All the workers working in the factory except the persons on whose behalf the Union was raising the dispute had taken stock of the reality on ground and had obtained a full settlement when gratuity as well as compensation had been given to a large class of workmen and in evidence of the same, they have subscribed the signatures of the settlement on 20.09.2002. The contention of the management was, therefore, that the writ petition had itself become infructuous. 4. The impugned order itself is sketchy and it merely details the request made by the management that it was going through a critical financial position when even the electrical connection to the factory premises had been disconnected due to non-payment of bills and the meter had been removed. It had set out the plea of the management that the manufacture of miniature bulbs and halogen C.W.P. No.406 of 2002 -4- bulbs had been stopped and they had been outsourced. The authority had noted that the net profits were coming down due to alleged recession in the market and except stating that the interest of the workmen had been kept in mind, the authority had not examined any of the objections which the workmen had stated in their representations and as if to offer a solace to the workmen, instead of granting the permission in entirety as sought for by the management, the competent authority had granted permission only for 30 workmen. The impugned order also referred to the fact that he satisfied himself about the allegation of the management that they were not manufacturing miniature bulbs and halogen bulbs by seeking information through the Labour-cum-Conciliation Officer, who in return reported that the Labour Inspector had visited the property and after hearing the contentions of the management and the Union. This was again a procedure, which the petitioners strongly objected, for this was being done without properly apprising the workmen about the nature of the report that the Labour-cum-Conciliation Officer had given to the competent authority. The procedure adopted, according to the learned counsel, lacked transparency that ill-behoved the conduct that was bound to be reflected in the order of a quasi judicial authority. 5. Even apart from the fact that the authority had not addressed the specific objections raised by the Union on behalf of the workmen, I find that every one of the objections, which is taken before this Court is disputed by the management. The C.W.P. No.406 of 2002 -5- contention of the petitioner was that the seniority list was bound to be prepared category-wise as per Rule 76 of the Industrial Dispute Punjab Rule 1958 as applicable to Haryana Rule which declares that employer shall prepare a list of all workmen in the particular category from which retrenchment was contemplated and arranged according to the seniority of service in that category. This list is required to be pasted on notice board in a conspicuous place at least 7 days before the actual date of the retrenchment. The department-wise retrenchment, which was sought by the management was there incompetent, according to the petitioner. The petitioner has stated that at least five persons Mohinder Singh, Jitender Singh, Angrej Singh, Udaivir and Neelam Verma had been shown in departments where they were not working and as if to show the mistakes committed by the management, the appointment orders and the transfer orders of these employees showing the correct departments had been placed on record collectively as Annexure P-5. The details given in the annexure were refuted by the management and they had in turn referred to several communications and leave applications given by the workmen themselves listing out the particular departments where they were working and submitted in alleged proof of their contentions documents collectively as Annexures R2/3 to R2/6. Yet another contention of the workmen had been that two of their trade union leaders namely Ghanshyam Sharma and Girraj Singh of Prefocussing Department had been picked up for retrenchment C.W.P. No.406 of 2002 -6- only on account of their association with trade union activities. While the status of union leaders themselves were not denied, the management contended that this objection was being taken for the first time only in the writ petition and they had not been urged before the competent authority. The further contention of the workman that the seniority principle had been breached and three persons namely Kishan Swaroop, Rajbeer and Trilok Chand had been juniors to Ghanshyam Sharma and Girraj and that they had been ratained was refuted by the management stating that the issue of seniority was being wrongly canvassed by the workmen and contested that the seniority list in the Prefocussing Department and the Capping Department had been wrongly cast by the petitioners in the writ petition. According to the management, even the issue of breach of seniority rule had not been specifically urged with reference to the names of the workmen in the contentions before the competent authority. If only the competent authority had actually dealt with these contentious matters and addressed them squarely before granting the permission, it would be possible for this Court to consider whether they have been correctly assessed or not. Even the report called for from the Labour-cum-Conciliation Officer seems suspect for the issue whether the management was actually manufacturing the miniature bulbs and halogen lamps could not have been merely decided by the Government by any discreet enquiry without affording to the workmen an opportunity to demand and secure on what basis, the Labour Officer had given C.W.P. No.406 of 2002 -7- such a report and whether such an inference was justifiable under the circumstances. This was all the more important since it was the linchpin upon which the management was seeking for permission to retrench some workmen. The contention was that the management had taken predominently trading activity instead of manufacturing and therefore, these was no need to retain the entire labour force, while the workmen were contending that the manufacturing was still going on and the management was unjustified in seeking for permission for retrenchment. 6. With skeletal lines of reasoning for determining the sufficiency of cause for retrenching the workmen, apart from the fact that every one of the contentions relating to the justification proferred by the management was being disputed by rival contentions, I deem it appropriate that the matter could be effectively adjudicated only if the issue is directed to be resolved on by due enquiry by the Labour Court. The subsequent event of several workmen having left the factory voluntarily will have little bearing to the rights of the workmen as such for prosecuting the case through their Union. The contention of the management in the written statement that the company has closed and that the writ petition itself has become infructuous is again of no consequence. The applicability or otherwise of the validity of such closure could be determined only in the context of whether such a closure was legally justified. The power of the Government to refer the matter for adjudication to the Industrial Tribunal under Section 25-N(6) C.W.P. No.406 of 2002 -8- ought to have been resorted by the Government itself instead of trying to collect information through discreet enquiry which was not put to the workmen. 7. The order of the competent authority is under the circumstances set aside. 1st respondent is directed to consider the issue of reference to the Industrial Tribunal for adjudication on the contentious issues raised by the workmen and contested by the management in the written statement. Having regard to the fact that permission had been sought for in the year 2001, the Government shall pass appropriate orders making the reference within four weeks from the date of receipt of the copy of the order. 8. The writ petition is allowed on the above terms. There shall be however no direction as to costs. (K. KANNAN) JUDGE November 12 , 2009 Pankaj*