1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION WRIT PETITION NO.162 OF 2005 WITH NOTICE OF MOTION NO.169 OF 2008 M/s.Amar Engineering Works & Anr. .. Petitioners Versus Shri K.G.Nair & Anr. .. Respondents CONNECTED WITH WRIT PETITION NO.163 OF 2005 WITH NOTICE OF MOTION NO.178 OF 2008 M/s.Amar Engineering Works & Anr. .. Petitioners Versus Shri Laxman B.Khaire & Anr. .. Respondents CONNECTED WITH WRIT PETITION NO.164 OF 2005 WITH NOTICE OF MOTION NO.179 OF 2008 M/s.Amar Engineering Works & Anr. .. Petitioners Versus Shri S.T.Pokharkar & Anr. .. Respondents 2 Mr.J.P.Cama, Sr Advocate a/w Mr.R.J.Cama and Ms.Pallavi Dedhia i/by M/s.Udeshi & Co for the petitioners. Mr.K.S.Kalappura for the respondents. CORAM : S.C.DHARMADHIKARI, J. DATE : 02nd July 2008 ORAL JUDGMENT: . These three petitions are by the Company-employer challenging the orders delivered by the 7th Labour Court, Bombay in references which have been made by the Appropriate Government in respect of three employees. Since the petitioner-employer is common but the three references were at the instance of three workmen whose claims have been awarded on identical grounds and reasons, common arguments were canvassed and therefore, these petitions are being disposed of by a common judgment. 2. In each of these petitions the Deputy Commissioner of Labour (Conciliation Mumbai) on behalf of the appropriate government forwarded the references under section 10(1), section 3 12(5), sections 2A and 39 of the Industrial Disputes Act, 1947 (I.D. Act for short) for adjudication into the demands of the workmen. The schedule to the order of reference sets out the demand, namely, whether the concerned worker should be reinstated with full backwages, continuity of service with effect from 07th March, 1994. 3. Pursuant to the reference being taken on file, directions were issued for filing of Statement of Claims. Each of the workman filed the Statement of Claim. Each one of them claimed to be employed with the petitioner. The quantum of wages was set out so also the designation. However, each one of them claimed to be workman within the meaning of section 2(s) of the I.D.Act. Each one of them stated that on 07th March, 1994, Management put up a Notice of closure and asked them to collect their dues and the closure was declared on the basis of union activities. However, the company started its operation from nearby premises recruiting new 4 hands. The Management in order to weed out the workers who had joined the union and were indulging in legitimate trade union activities displayed the Notice. No chargesheet was issued nor was any inquiry held. This amounts to termination of their services without following the norms and procedure in that behalf. The specific case of these workmen was that the company illegally terminated their services on or before 07th March, 1994 without any notice or reason and without paying or offering one months pay at the time of termination of services of the workmen. The company also did not pay wages of the workmen for the days worked in the month of February and March 1994. Thus, the termination is illegal, inappropriate and malafide. The company has violated section 25(f) of the Act. The Statement of Claim proceeds on the basis that the workmen sought intervention of the Deputy Commissioner of Labour. Their demand was admitted in Conciliation but repeated efforts resulted in the conciliation not ending in resolution of the disputes. Therefore, the 5 reference was made. 4. The petitioners filed their written statement in each of these references. It is their case that one of the employees Mr.K.G.Nair the petitioner in Writ Petition No.162 of 2005 is not a "workman" as he was employed as Accounts Assistant with effect from 06th April, 1990. It is their case that they are a small proprietary concern of one Naresh A. Shah. They employed about seven workmen in different categories at the relevant time. The employer in written statement raised the issue of labour problem. Further, he contended that the unit was a supplementary unit to other major companies. The work undertaken was job work. Since there was a labour problem, they could not keep their commitments with the major companies and therefore lost important clients. The workmen were requested orally not to indulge in activities detrimental to the working and functioning of the concern but they did not pay any attention to the same. In such 6 circumstances, the petitioners had no alternative but to close down the unit from 07th March, 1994 vide closure notice. The employer called all the workmen to collect their legal dues. The employer also sent individual notices dated 07th March, 1994 to the workmen asking them to collect their dues between the working hours and more precisely between 9.30 a.m. to 10.30 a.m. Except the three workmen at whose instance the reference was made, all others collected their legal dues in pursuance of the notices. The closure, therefore, was bonafide and legal. The same was on account of want of business. The situation was beyond the control of the management. 5. The written statement specifically stated that after some months the situation in the market improved, there were some orders which were received for job work and the unit was reopened with effect from 18th June, 1994. The employer, therefore, asked each of the workman covered by the dispute to report for work by 7 their separate letters, more particularly referred to in the written statements. The workmen did not opt for work. Even when the conciliation proceedings were going on the petitioners offered reinstatement. In pursuance of the same, Conciliation Officer requested the workmen to report for the work but they did not report. The failure report would speak for itself. When the workmen did not report for the work, the employer was forced to recruit fresh hands. In such circumstances, the claim was denied in toto. Apart from reiterating the contentions as above, all averments in the statement of claim have been dealt with and denied. The employer prayed that the reference be rejected. 6. Upon pleadings being complete the Labour Court framed issues. Issue No.1 reads thus:- ."Does the workman prove that he is entitled for the reliefs claimed?" 8 7. The workman stepped into the box in each of these references. In rebuttal the proprietor entered the box. He examined two more witnesses, who are the parties, placing orders for job work. 8. At this stage, it would be pertinent to refer to the deposition of one K.G.Nair. In his examination-in-chief while reiterating the contents of the Statement of Claim he states that he joined the company on the date mentioned in the claim. He joined as an office clerk on salary of Rs.300/- per month. He states that after March 1990 the name of the company was changed and it was M/s.Amar Engineering Works. At the time of removal he was Office Assistant drawing salary in the sum of Rs.2,850/-. He has referred to the demands made and joining of Bombay Kamgar Kranti Sangathana. He states that this was the reason for removal from services. No prior notice was displayed before removing the workers by the Company. He states that he worked up to 05th March 1994 and 06th March 1994 was holiday. Notice was displayed on 07th March 1994 9 on the entrance of the Company stating that Company is closed and the workmen should collect their legal dues. However, the Company did not pay the legal dues. The reasons for closure are that the company sustained loss. It is stated that on 16th March 1994, the workmen went to the Company to collect the legal dues but they were threatened by the employer. It is admitted that the employees collected their dues after expiry of four months. The workmen concerned have not collected the legal dues as company demanded resignation from them. He was told by the Company that legal dues should be deposited in the Court. He does state in the examination in chief that after alleged closure the Company was functioning from the Neighbouring premises i.e from R.G.Engineers. It is in such circumstances that there was dispute raised but it was not settled and that is how the reference. 9. In the cross-examination of these workmen and more particularly that of K.G.Nair he admits in para 3 that he was employed from 1990 and has 10 no material with him to show that he was employed prior to that date. In para 4 he states that he was working with M/s.Amar Engineering Works in 1990. At the same time in para 5 he deposed about the wages but it is stated by him that he has forgotten to mention that conveyance allowance was also paid. It is pertinent to note that the workmen stated that he has no particulars of the amount and other facts which he has mentioned in the Statement of Claim. After his attention was invited to the Statement of Claim to refresh his memory, he stated that he cannot tell what are the particulars of amounts which are due and payable. He has stated that he forgot to mention about the assurance given by the lawyer to include the P.F.Scheme. He has admitted that he has no documentary evidence to show that any assurance was given. He has no documents to show that he demanded implementation of P.F.Scheme. Thereafter, it is admitted by him in para 6 that the union was joined in January/February 1994. However, he admits that he has not filed any document to show that he and 11 other workers became members of the Kamgar Kranti Sanghtana. He admits that he has no document in his possession to show that he has become member of the said union. He admits that 13 workers were working out of which 9 became members of the union. He admits that he has no knowledge of whether the union has raised any demand on their behalf after they allegedly joined the same. There is no document with him to prove the membership of the union. There is no copy of any letter or correspondence with the union. 10. Paras 7 and 8 of his cross-examination read thus:- "7. The first party displayed the notice to collect the dues on 3.3.1994. On the same day, I went to collect my dues to the company. Now I say the date 14.3.1994 mentioned in my deposition is wrong date. It is true to say that I had not mentioned the facts stated above in my statement of claim. I inadvertently 12 stated the date 14/3/1994 while giving my oral evidence. 8. On 12.2.2003, after giving my deposition, when I went home, I realised that I had mistakenly stated the date 14.3.1994. After recording evidence on 13.2.2003, I have not taken any steps to correct the mistakes recorded till today though I realised it on the same day i.e.13.2.2003. I cannot tell the reason why I have not take the steps to correct my chief. I have visited the company after 8.3.1994 till 20.3.94. I have no documents to file and support my above statement. It is not correct to say that I have not collected the legal dues though the first party kept it ready with them. It is true that the rest of the workers have collected their legal dues from the first party company except we three. It is correct that I have not mentioned in my statement of claim that 13 on 16.3.94, the first party has threatened me when I went to collect my dues, though I have stated in my chief. The reason for not stating the above facts in my statement of claim, is I had forgotten it. I had not filed a copy of the police complaint about the alleged threats. I am not ready to accept the dues today. It is not correct that I was not ready to accept my dues as I wanted to agitate the matter in the Court. It is true that in my first letter 2.9.1994 addressed to the Dy.Commissioner of Labour, I had not asked the dues." 11. Thereafter, it is admitted that first party Company/employer intimated and instructed the concerned worker to come on 08th March 1994 to collect the legal dues. It is stated that in the office of the union there was no other employee except the workman. Therefore, any letter addressed by the Company comes to the 14 office. He has admitted the address which is mentioned at Exhibit ‘C-A’ and it is in these circumstances that Mr.Nair states that he is ready to join the duties even tomorrow. Thereafter, he gives a break-up of the monthly income and expenses. 12. The proprietor stepped into the box and he has stated that the closure notice was displayed on 07th March 1994. He proved the closure notice after confirming the contents thereof. He states that individual notices were given with regard to this closure to all workmen. The employer states that he offered closure/legal dues to all workers. Except the workmen covered by reference all other workers accepted the closure notice and the compensation/legal dues. In the cross-examination of the proprietor the questions were with regard to the nature of the activities of the proprietary concern, the business of job work. While it is true that the employer could not give particulars of the workmen joining the union but he also states that 15 the closure notice was sent on the address of the union. He says that he has not recognised the union. He produced electricity bill to show that no work was carried out in the factory. 13. The other witnesses were the representatives of the Companies who had placed job work orders. They stated that their materials were not delivered in time and that is how they had to get the work done from the other sources. 14. Upon this material the Labour Court heard oral arguments and rendered the final award in the following terms:- "1. The reference is partly allowed. 2. The second party is entitled for the reliefs of reinstatement, continuity of service and full back wages from date of his illegal termination i.e 7/3/94 till the date. But the relief of 16 reinstatement for further from 22/7/2003 is not granted to the second party considering his request. 3. The first party is hereby directed to pay the full back wages from 7/3/94 till date and with continuity of service and all consequential benefits to the second party. 4. The first party has to implement this order within period of two months from the date of publication of this award. 5. No order as to costs." It is this award which is subject matter of challenge in these petitions. 15. Both sides do not dispute that the oral evidence is identical in the references of other 17 workers. It is for convenience sake that both sides have referred to deposition of K.G.Nair which is the first Writ Petitioner. 16. Mr.Cama learned senior counsel appearing for the petitioner contended that the award is ex-facie erroneous and untenable. It is vitiated because the Labour Court has committed a serious error in entering into the controversy regarding bonafides or reasons for closure. He submits that the Tribunal has no jurisdiction to do so in law. There is complete non application of mind in as much as closure and the right to close down is something which is undisputed in law. The reasons for the same cannot be gone into by the industrial adjudicator. That apart, when there is no dispute about closure and both sides approached the Court on the admitted position that factually there is a closure of the establishment, then, there is no industrial dispute. He submits that the Tribunal has completely overlooked Statement of Claim and the written statement. Nobody requested the Tribunal 18 to go into the issue of bonafides of closure or whether the reasons in that behalf are tenable in law or not. There was no issue as regards the same. The plain and simple case was of an illegal termination. Once the Statement of Claim projects the grievance of illegal termination of the concerned workmen, at the same time admitting that the establishment is closed, then, there is no reason for the Court below to have gone into the bonafides of the employer in closing down the establishment. The genuineness or otherwise of the reasons assigned is something beyond the jurisdiction of the Labour Court in the facts of this case. The only issue and ground is non-payment of closure compensation and other dues. He has invited my attention to the Statement of Claim and the written statements. He submits that none has raised the issue of re-starting of the industry/establishment. That apart, even if that this case would have been put an issue, yet, the workers do not dispute that they were in receipt of the notices/intimation to rejoin the duties. Therefore, reinstatement in 19 the services is refused to each of these workmen. Yet, directions are issued to pay backwages allegedly on the ground that the offer of rejoining duties came to be made during the pendency of the reference and till the date of the offer, the wages should be paid. He submits that even these findings are rendered without any issue being framed and without any material placed before the Court. Once factum of closure is not disputed, there is no question of reinstatement and the reference should have been rejected in toto. Mr.Cama has taken me through the deposition of the parties and the contents of the documents to support his submissions. Additionally, Mr.Cama has placed reliance on the following decisions:- "(1) (1979) 3 Supreme Court Cases 762 (Pottery Mazdoor Panchayat Vs. Perfect Pottery Co.Ltd. & Anr.); (2) AIR 1960 Supreme Court 815 (V 47 C 139) (Tea Districts Labour Association, 20 Calcutta Vs. Ex-employees of Tea Districts Labour Association & Anr.); (3) AIR 1968 Supreme Court 1002 (V 55 C 195) (M/s.Indian Hume Pipe Co Ltd Vs. Their Workmen); (4) 2005 II CLR 679 (DBH International Ltd. Vs. Their Workmen, represented by the Tansport & Dock Workers Union & Anr.); (5) 2005 II CLR 679 (Welcome Group Searock Vs. Searock Hotel Employees’ Union & Anr.); (6) 2005 I CLR 964 (Maruti Udyog Ltd. Vs. Ram Lal & Ors.); (7) 1975 LAB. I.C.457 (Sadanant Patankar Vs. M/s.New Prabhat Mills No.2, Bombay & Anr.); 21 (8) 2005 II CLR 1055 (General Manager, Haryana Roadways Vs. Rudhan Singh); (9) 2002 III CLR 488 (Sonal Garments Vs. Trimbak Shankar Karve). 17. On the other hand Mr.Kallapura appearing for the workman in each of these matters submits that there is no closure in the eyes of law. There is no opportunity to the workmen before the notice came to be pasted and displayed. Their services have been put an end to abruptly and without any opportunity. The closure is permanent and irrevocable. That apart, this version is also conflicting in as much as in the conciliation proceedings the management came with the plea that the workmen had tendered their resignations. However, there is absolutely no reference to this and the arguments proceeded on the basis that bonafides of the closure cannot be gone into. This conflicting version of the 22 employer is reason enough to dismiss this Writ Petition. He submits that closure is on paper. The establishment is working from some other premises. The financial position is also sound, there are no losses instead profits have been earned in the relevant years. In such circumstances and when nothing was paid to the workmen, then, their termination cannot be sustained. 18. Assuming that there is a closure and that fact cannot be disputed that the reasons for the same cannot be probed, yet, the company reopened admittedly. The petitioners did not make any offer by R.P.A.D letters. There is nothing produced by company to show that offer was made in writing to these workers. The entire case is made up only because the petitioners desired that the workmen should not take part in union activities. However, if union activity is legitimately permitted in law, then, that is no ground to deny re-employment which is nothing but the harassment of the concerned workman. For all 23 these reasons these petitions be dismissed. 19. With the assistance of the learned counsel appearing for both sides, I have perused the petitions and the annexures thereto. I have perused the compilation of the oral and documentary evidence tendered jointly. I have also perused the relevant documents. 20. It is not disputed through out that on 07th March 1994 the following notice was displayed:- ". This is to your kind information and knowledge that the above named company close down its business activities on and from 7.3.94. The company already displayed closure notice on the company’s entrance vide their closure notice dated 7.3.1994. . You are therefore advised to collect your closure compensation legal 24 dues if any on 8.3.94 between 9.30 a.m. to 10.30 a.m. If you failed to collect the same on that day I may deposit the said amount in the court which you may please note. The notice of closer also enclosed herewith for your kind reference." 21. It is contended before me that prior to this the petitioner also put up three general notices bringing to the notice of the workmen concerned that their non co-operation is resulting in production being disrupted. Late delivery of the job work produce/goods results in the company loosing valuable clients. It is thereafter contended that the above mentioned notice was pasted and displayed. On 12th July 1994 another notice was put up which reads thus:- "You are aware that we have closed out unit on and from 7.3.1994 to till date. Closure is effected due to acute shortage 25 of orders and other various reasons as setout in our closure notice dated 7.3.1994. In the month of July 1994, I have received orders from one of the clients and I am re-opening the factory with effect from 18.7.1994. You are being one of the old employees, I am advising you to report for work within seven days from the date of receipt of this notice." 22. In furtherance of that on 23rd August 1994 workmen where once again requested to resume work within 7 days. They were also intimated that the company would not be in a position to offer employment thereafter. It appears that the matter went in conciliation and in conciliation also offer of taking them on work with effect from 22nd December, 1994 was made. 23. On June 07, 1994 i.e prior to the notice 26 regarding recommencing of operations, the workman Laxman Khaire, S.T.Pokharkar and K.G.Nair addressed a letter to the proprietor of the petitioner wherein they stated that they are working since 1990 and were working as such till the illegal closure of the establishment on 07th March 1994. The letter itself states that a notice of closure was put up and that they were asked to collect their legal dues. They stated that the closure was declared because of union activities but the operations have commenced from nearby premises after new hands were recruited. In such circumstances, it is stated that action of management in bringing their services is illegal, inappropriate, malafide, against the principles of natural justice so also is a unfair labour practice. It is in these circumstances they claim reinstatement with full backwages. 24. The version of the company before the conciliation officer is on the same lines as in the written statement. If the Statement of Claim is perused, that also does not dispute the 27 closure. The Statement of Claim in paras 3 and 4 projects the action of termination and terms it as illegal. 25. It is in these circumstances, that I find substance in the contentions of Mr.Cama that at no stage there was any dispute regarding the factum of closure.